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  • punk_ash punk_ash • Aug 15, 2007 11:37 AM Flag

    How is SRS related to VNQ

    I have seen that SRS = -2 VNQ in moves. Has anyone else any ideas.

    VNQ has been a good hedge for me in the past. REIT is the last thing you want to hold in this market, sub prime woes are just beginning, if that gives rise to an overall contagion, REIT will be one of the hardest hit. Do not be fooled by the high dividends.

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    • david_schere david_schere • Dec 26, 2007 4:19 PM Flag

      I have been holding srs as a shield against the decline. SRS has its flaws though:

      srs does not always do -200% of ^djr
      ^djr does not always track vnq well but they are very close.

      But ... if you use 40% srs and 60% vnq you should wipe out any declines and be left with the dividend. Then you can periodically take profit from srs and average into vnq on the way down until we do bottom.

      It works *well enough* if your goal is to hedge and accumulate shares.

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77.530.43(+0.56%)May 17 4:00 PMEDT