dollar cost average. I doubt there are many traders (day) making money these days. Of course they say they are but the reality is unless you are in LT right now you are on the losing end. Too many traders get stopped out and end up chasing or are on the wrong side. The market is only moving with the $ these days. Commodities are the safest bet on the $ strength. Despite the policies of bumbling idiots in Washington, the economy will eventually recover.
Seems like a no brainer. What makes our decision to buy at these levels look like we had no brain(what will make the price go down)? I'm looking for reasons to buy more...just need to make sure.
Nothing of any significance will make URE go down....unless there is some unexpected non-financial disaster that drives the market down as a whole. Real estate may be in a bottom for some time comercial RE more then residential RE. Why not hold for the next 6-12 months and find out. if you look at the charts the bottom resistance is holding so we have a pretty good idea of the down side uless it breaks those support levels but URE has tested the bottom more then a few times and managed to bounce back. up-side is endless over the next 6 to 24 months. My guess URE will be in the low to mid teens as RE sees the end of the seeming endless bottom.
You shouldn't "just buy and hold" a leveraged ETF. You do know that URE is 2X leveraged, don't you? Do you realize there is a nightly reset on leveraged ETF prices? So the efect in a down market is that your losses are compounded. But the compounding has less effect on average in the positive direction.
To see what I mean, take a look at the 1 year chart comparing URE & its inverse, SRS:
Notice they both lost value over the last year.
Dollar cost averaging is a great long-term strategy, just not smart applied to leveraged ETFs.
Now, as far as trading goes, I've made money jumping in & out of URE. The way I do it is with options. I sell puts until the shares are put to me at a very nice low price, then turn around & sell calls until they are taken away at a profit. In addition to the price appreciation, I get to keep the option premiums, which are higher on a leveraged ETF due to the increased volitility. I almost don't care what the base price is because I'm trading the volitility.
You are right about traders getting stopped out. That's a good reason to use options instead of stops.
I agree with your concept but not when applied to URE at these prices. Real Estate is at or near it's long term bottom and really has only one direction to go, up. Buying and holding URE at this level and dollar averaging up the ladder is the way to make money now. In a year or two I would not say this. At this level URE has bottomed and should appreciate significantly over the next 12-18 months. It's a "no-brainer".
good luck. Hard assets are prime for those with money to make their move. I don't know people, but I know people who know people with lots of money in cash waiting for opportunity. The wealthy get wealthier by taking advantage of economic downturns like these.