Friday, April 29, 2011

Don't put all your money in one index

I have back tested using just one ETF to trade as in QLD.  What works better is trade at lest three ETFs at a time and the equity curve will be smoother with three to five diverse indexes.  My favorites are BGU, TNA, EDC.  Russell 1000, Russell 2000, Emerging markets.  These cover basically the whole US market and much of the rest of the world.  Yes using levered ETFs cause more volatility and larger drawn downs.  Over years it pays off nicely.

The Timingcube.com site which I subscribe to has some compelling gains over ten years time frames.  It shows results using QQQ, IWM and SPY.  Using BGU, TNA, EDC with the 3x leverage the gains are well WOW.

So if you don't have a trading system and don't want to create one, Timingcube is a choice.  I chose to develop my own and it gives better results than Timingcube and it feels good to have my own winning system.  Just like Timingcube I too will not give out exactly how my system works, no way.....

I will after the fact let you know my signals. I encourage you to put in the time and effort to create your system for I am very glade I did.

Remember the trend is your advantage.  Identify it and follow it.
Good luck with your creativity

Ben

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