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It is 830 am edt. I rebuilt a weekly port and strategy for the week of 1/11, using data from this morning in Barchart. In addition, I have another built from a manual stock list. However, the strategy is still showing the week being 1/4-7 and is not including 1/8.
I find that you can build any port you want. I have one that is TQQQ hedged with TMF and VXX. You can build individual stock ports and hedge them.
Even if you subscribe to stock picking services, the hedging you get with Quant Trader really improves your odds. If the market is in a nosedive, NOTHING works very well as money is pulled out of all assets.
I have made some bad trades assuming interest rates could fall no further and HAVE to rise. Now I have added uvxy as a hedge option. Working so far…
There is a service on Seeking Alpha, Value and Momentum Breakouts, by JD Henning. He has a momentum trading tool that toggles between 3x shorts and longs. SPXY/SPXU, TQQQ/SQQQ, FNGU/FNGD, ERX/ERY, LABU/LABD, TNA/TZA. There are other L-I members who participate in both services. You can look into his site and has a free trial period. I can tell you he called the market short last Friday!!
I have several people on SA paid services that are trying out your service. Why don’t you guys post an updated article on Seeking Alpha???
i have owned croc and euo off and on in my IRA/401k. I get the forms but the ETF holder does not know if you are in a taxable or nontaxable account. I just throw them away. BTW I owned EUO when Brexit vote passed a couple of years ago…that was sweet.
Let me add that these are quite volatile, like MYRS, and probably need to be a semimonthly trade instead of monthly.
Yes, I have built them into QT, but I keep my models simple and don’t use the mean reversion/etc. that you guys use on SPXL. So, a strategy that you guys develop would be much better than mine. Since QQQ is used in your US market, you could also develop a TQQQ/Hedge.
I belong to another service on Seeking Alpha and have recommended UIS 3x to other members; I sent them your link, etc. The service recommends 3x funds of all kinds on a weekly basis, and sometimes has long stocks like TECL/SOXL together with UGLD and/or TMF. But they are not managed in the hedge, max sharpe, fashion that LI does.
I use QT to determine the proper hedge.
IMO–UIS 3x was a problem once the fed started hiking rates as TMF, which was the old standby hedge favored by falling rates, was getting crushed along with SPXL. It was the worst of both worlds. I recall they added UGLD to get disconnected from interest rate dependence. However, once the FED started cutting rates, then TMF worked properly again. So, as long as they hold or reduce rates further, TMF is a wonderful hedge for SPXL.
The same thing happened to the MYRS. Volatility spiked so ZIV plummeted, and the TMF hedge worked backwards of the strategies intent. I held money in both strategies when they went south.
My personal view of UIS 3x and MYRS is to allocate to each like they are small cap stocks.
Yes, if treasuries are falling. So it was a disaster last year when the Fed was raising rates and the markets, SPY, got tanked. BUt. over time, it is good as long as bond rates are flat or falling.
I notice GSY has shown up this much in BRS, Nas and Dow.Apparently it is coming from both the Gold and Treasury hedge strategies. It seems to be almost the same as a money market fund.
I have not seen any explanation of this modification and would like to hear more about it. Thanks.
That listing starting with AAPL was from the QT run this morning. The website lists CELG, HAS, and WTLW along with FOXA. In both cases, the strategy switched from leaders to low volatility.
I noticed that with QT 515S, the Nas100 reverted from high volatility to low volatility back to the beginning of February. Per the original allocation on 2/1, I am holding AVGO, SBUX, XLNX and WDAY; this is saying I should have been be holding AAPL, CTXS, FOXA and PAYX. Please explain, thanks.
Vangelis,
I have a question about the hedge. I have added VXX into the QT for UIS 3x. It is selected 90% of the time over 3 years. Have you looked into that as a hedge?By the way, my allocation strategy had 30% CAGR but also a possible 8.85% drawdown–which happened! So the model predicted what could happen. I think that, however I allocate going forward, I will always have in mind how much money that WILL be in a sudden spike down market, and then decide if I am that brave or not.
I understand that, when there is a panic drop, limit order stops get passed over and do not execute; conversely, market order stops get killed because your sale is for crumbs. Frank and the other guys have all said to only use limit orders, and this sort of thing is why.
Jim Cramer devoted much of his show tonight telling us that the leveraged volatility funds (he named UVXY, SVXY, and TVIX) are being unwound by hedge funds, who are having to sell off stocks because of large inverse volatility margin debts when the VIX took off. (IMO, the guys were wise to specify ZIV.)
That precipitated the whole mess, in his opinion. He was a hedge fund manager and knows how this stuff works.
His advice was to watch the volume on these ETN’s and that, until volume declines and normalizes, avoid adding any positions.
I have heard many opinions that cryptocurrency is here to stay in some form or another. So, I found one alternative is to invest in stocks that are in the bitcoin/etc. coins and the blockchain. I have put a very small amount into GBTC, GROW, MGTI, and OSTK. I have seen a lot of opinions that Overstock is the safest way to play, as it is already well established.
Due to their short lives, in many cases, the QT model blows up because the CAGR numbers are incredibly high.
I am also using a group consisting of UDOW, TQQQ and SPXL, and having the software nominate what is invested. I require 10% minimum in each of the 3, and hedge with TMF using the structure (lookback, etc.) as UIS3X.
From Morningstar the rough % composition of the unleveraged ETF’s is:
Item – QQQ – SPY – DIA
Fin. – 1 – 17 – 20
Ind. – 4 – 11 – 23
Tech. – 58 – 21 – 14
#1 Hdlg AAPL{12) AAPL(4) BA(8)Does anyone have any thoughts on this?
I have a lot in this strategy and found the market action unnerving until I figured out what was happening. Pls see below, there is a dividend being issued.
A Dividend being issued onn 12/20!
https://www.dividendinvestor.com/dividend-quote-new/
Dividend Declaration Date
Dec-12-2017
Dividend Ex Date
Dec-13-2017
Dividend Record Date
Dec-14-2017
Dividend Pay Date
Dec-20-2017
Dividend Amount Current
$ 1.603590
Dividend Amount Previous
$ 0.008517Frank,
I have a question re the use of CROC as the currency hedge. Its volumes are so low, how it is effectively traded?Since it has not been nominated since I got into the GC strategy, it has not been an issue to date.
I am about 20% in GC.
Gentlemen,
I enjoy the LI model and have used it now for 18 months.
I use the BRS, G-C, MYRS, N100 and UIS 3X strategies (with a minimum of 10% allocated to each).
CWB has been a major holding for most of the time in BRS. I received a letter from the SPDR series trust stating that, as of 10/2/17, the benchmark index name was changed from “BLoomberg Barclays US Convertible Bond Fund >$500MM Index” to “Bloomberg Barclays US Convertible Liquid Bond Index”.
Will these changes effect how CWB operates?
I am curious to know if the SPXS-TMV strategy would occasionally be selected over SPXL-TMF. Looking at the quant trader,
it seems to perform about the same overall.If a longer trend develops towards a gradual climb in Fed rates, what are your thoughts on TMV being a better overall performer–as TMF was during 30+ years of falling rates?
