- Crude oil: +31.8% since entry May 25 (using 200% leveraged fund)
- Nikkei: +0.5% since entry June 8
- Natural gas: entry June 15
SHORT
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CLOSED TRADES
- BKX U.S. Bank Index: +19.7% since entry May 25 (using 200% leveraged Canadian financials ETF)
- Gold: -12.0% since entry June 1 (using 200% leveraged fund). Stopped out June 15.
Notes:
- Positions are as of Monday morning, June 15.
- Unless otherwise noted, returns on trades are based on my own positions, not the underlying market prices. Returns from closed trades include trading fees. My own return may differ from the return of the underlying index, security or commodity because of variations in how the security I use tracks the market. In some cases, my return is based on a leveraged fund and may also include currency exchange into Canadian dollars.
Notes:
- Positions are as of Monday morning, June 15.
- Unless otherwise noted, returns on trades are based on my own positions, not the underlying market prices. Returns from closed trades include trading fees. My own return may differ from the return of the underlying index, security or commodity because of variations in how the security I use tracks the market. In some cases, my return is based on a leveraged fund and may also include currency exchange into Canadian dollars.
4 comments:
Hi Alex,
May I ask why do you use 200% leveraged Canadian financials ETF for BKK US bank index?
Also is it true that the 200% leveraged ETF has significant problem tracking the actual index return and adjusted for the leverage due to it resets ETF value on a daily basis?
Cheers,
Andy
Alex,
What security do you use to gain exposure to Natural gas?
I am from Australia. There is virtually no ETF markets here. If I ever want to trade commodities using ETFs. I have to execute on the US market.
Any ETFs that are US dollar hedged?
Cheers,
Andy
Hi Andy,
I like to consult the regularly updated ETFs list at: http://dvtechtalk.com/specialreports/specialreport1.htm.
I myself am using the 200-percent leveraged HNU ETF trading in Toronto for this particular signal.
Regards,
Alex
Hi Andy,
I'm using the Canadian ETF because I didn't have any available cash in my U.S. dollar account. A U.S. ETF would have been a better security to track that signal, as Canadian banks have outperformed in recent months. In fact, however, because of that, a Canadian banks ETF might be a better choice for long signals, while the U.S. ETF might work better for short signals. The problem with this approach is it's not clear how long the Canadian outperformance will continue. It could even reverse at some point.
It's true the leveraged ETFs best track the underlying index on a daily basis.
Performance can degrade longer-term if the underlying index is in a trading range. On the other hand, the ETF tends to outperform the underlying if the underlying is trending - which is what the COT signal is typically trying to catch anyway.
So I don't see it as a problem.
Also, my trades are averaging only three weeks, so that also means there's less of a problem for me.
Regards,
Alex
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