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Vanguard 500 Index Inv Message Board

judge_smailes8 125 posts  |  Last Activity: Apr 8, 2014 9:54 AM Member since: Dec 17, 1999
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  • Reply to

    LBJ has been on a tear lately!

    by judge_smailes8 Mar 31, 2014 1:18 PM
    judge_smailes8 judge_smailes8 Apr 8, 2014 9:54 AM Flag

    No, I am still in the red, I have been buying LBJ every month since March 2010 and obviously it kept going down throughout that period of time. My low point was on 2/3/14. However, I have since recouped about half of my losses in LBJ. I will be even when it hits about 34, so it still has a way to go before I am even.

    I am up on all of my other leveraged ETFs. My biggest gainer is still TQQQ. Tech stocks have corrected, but I still think they'll be strong later in the year.

    Sentiment: Buy

  • judge_smailes8 by judge_smailes8 Mar 31, 2014 1:18 PM Flag

    LBJ just hit 19.99, a gain of about 39% since the market close on 3/14. It is about time that LBJ showed signs of life. I don't really understand why it is moving up so much right now. Then again, I couldn't explain why it has dropped so much since 2010. I'll just enjoy this bounce - hopefully it will last awhile.

    Sentiment: Buy

  • judge_smailes8 judge_smailes8 Mar 27, 2014 10:36 AM Flag

    I just transferred my Vanguard mutual funds into a Vanguard brokerage account and was hoping to use the funds as collateral to sell short some inverse leveraged ETFs. However, Vanguard brokerage didn't have any shares of TZA, VXX, SPXU, SQQQ, QID, or even SDS to short! SDS has a market cap over over $1 billion, so I figured that there had to be some shares of SDS to short, but Vanguard claims they don't have any to lend.

    Sentiment: Strong Buy

  • judge_smailes8 judge_smailes8 Mar 27, 2014 10:33 AM Flag

    I have owned RSX for years - I consider it to be a long-term hold. I won't touch FXI - I figure I own enough Chinese equities through VWO.

    Chinese equities have actually substantially underperformed Latin American ones over the past 20 years, if you can believe that. EWZ is showing signs of life and is lifting LBJ and BRZU.

    If you really want a volatile play on Russia, consider RUSL. Whenever Russian stocks experience a multi-year rally, RUSL will rocket higher. A rally like the one between 2003 and 2008, would likely have sent RUSL higher by 10,000% or more, although perhaps that period was simply an emerging markets bubble period.

    Tech stocks may not do much for the next few months, although I still expect TQQQ to finish the year somewhere around 90-100 or higher.

    Sentiment: Strong Buy

  • judge_smailes8 judge_smailes8 Mar 18, 2014 2:30 PM Flag

    I think that your data is still off. Do you really mean a length of time without a "correction" or a length of time without a "bear market"? I assume that correction means a drop of 10-20% and a bear market is a drop of 20% or more.

    The S&P 500 actually did drop by more than 20% back during the later months of 1990.

    I don't know how many corrections there were during the early 1990s, but I would be surprised if there wasn't another 10% drop sometime between 1990 and 1994. 1995 was the year when everything really took off.

    Sentiment: Strong Buy

  • It has been almost a year since the last reverse split of TZA. Will there be another reverse split by the end of 2014?

    Sentiment: Strong Sell

  • judge_smailes8 judge_smailes8 Mar 17, 2014 11:58 PM Flag

    Your data is way off! You are implying that the last correction prior to 2007 was in 2000? There was a terrible bear market between March 2000 and October 2002! The S&P 500 dropped more than 22% during the 2002 calendar year. The Nasdaq Composite dropped nearly 80% between this bear market.

    It would not surprise me to see the VIX drift closer to 20, which would hurt SVXY returns this year, although when the VIX finally does stabilize, contango should return.

    Sentiment: Strong Buy

  • I received a Schedule K-1 for a security held in a 401k. Do I need to pay taxes on my SVXY holdings even though they are held in a tax-sheltered account?

    Sentiment: Strong Buy

  • Reply to

    Has anyone been able to short SQQQ?

    by judge_smailes8 Mar 11, 2014 8:52 AM
    judge_smailes8 judge_smailes8 Mar 17, 2014 5:23 AM Flag

    Your calculation of your gains from shorting is way off. Let's assume that you sold short $10,000 worth on SQQQ on the first day of trading on 2/11/10 and covered the shares after SQQQ had dropped 96% by 3/14/14.

    Assuming for a second that there were no trading commissions incurred, the proceeds from the short sale would be $10,000 and after dropping 96%, it would cost $400 to cover the short sale. In this case, your gain would be [sale price - purchase price], or $10,000 - $400 = a gain of $9,600. Your cost of this trade was only $400, so your % gain would by $9,600/$400, or 2,400%, not 96%.

    Assume that your commission for the sale is $10 and your commission for the buy is also $10. Accounting for commissions, your gain would be $9580, and the cost basis would be $410. So the % gain would be $9580/$410, or 2,336.5%.

    On a % basis, far more gains may be realized from shorting SQQQ than may be realized from buying TQQQ.

    Sentiment: Strong Sell

  • Reply to

    Will TQQQ hit 100 by the end of the year?

    by judge_smailes8 Mar 4, 2014 3:50 PM
    judge_smailes8 judge_smailes8 Mar 14, 2014 2:36 PM Flag

    I agree that the economic recovery has been weak, in large part as a result of the ineptitude of that moron in the White House right now. However, the low interest rates have helped companies shore of their balance sheets, which I suspect has a lot to do with the improved profitability due to financial engineering.

    I shorted more TZA today. In the ideal scenario, I will ride my shares of TZA until TZA falls below $1/share. I have daily total-return closing data for the Russell 2000 dating back to mid-1995 that accounts for reinvestment of dividends. If TZA had been in existence as of mid-1995, it would have posted an annualized loss of about 40% during this period of time and I suspect that returns prior to mid-1995 would have been about the same.

    I wish I could short SQQQ as that ETF will lose even more on an annualized based - close to 50%!

    Sentiment: Strong Buy

  • Reply to

    Will TQQQ hit 100 by the end of the year?

    by judge_smailes8 Mar 4, 2014 3:50 PM
    judge_smailes8 judge_smailes8 Mar 13, 2014 2:36 PM Flag

    I tried shortly more TZA today through Ameritrade and was again informed that there are no shares available to short! I guess I got lucky on Tuesday when I was able to short TZA.

    Sentiment: Strong Buy

  • Reply to

    Fedrally's bet on VXX in February 2014

    by emerging_mkts Mar 12, 2014 10:40 AM
    judge_smailes8 judge_smailes8 Mar 13, 2014 5:48 AM Flag

    It appears as though you are arguing that if XIV and SVXY get too large, that will affect the overall VIX short-term futures market. However, have you accounted for the size of VXX? If the size of XIV/SVXY reduces contango, shouldn't an increase in the size of VXX increase contango?

    Sentiment: Strong Buy

  • Reply to

    Will TQQQ hit 100 by the end of the year?

    by judge_smailes8 Mar 4, 2014 3:50 PM
    judge_smailes8 judge_smailes8 Mar 12, 2014 7:41 PM Flag

    Those guys are notorious permabears! I don't see the S&P 500 dropping to 1150 unless there is a nuclear war or a major terrorist attack.

    By the way, I was finally able to short TZA through Ameritrade yesterday for the first time in nearly 6 months.

    Sentiment: Strong Buy

  • Reply to

    Has anyone been able to short SQQQ?

    by judge_smailes8 Mar 11, 2014 8:52 AM
    judge_smailes8 judge_smailes8 Mar 12, 2014 8:12 AM Flag

    I would short SQQQ outright, not to arbitrage TQQQ.

    Look at the long-term chart for SQQQ. Granted, SQQQ has not been around long, but it has dropped from a split-adjusted 1231 on its first day of trading on 2/11/10 to a closing value of 51.25 on 3/11/14. According to my calculations SQQQ should lose about 50% of its value in a typical year.

    Sentiment: Strong Sell

  • judge_smailes8 by judge_smailes8 Mar 11, 2014 8:52 AM Flag

    Has anyone here ever been able to sell short shares of SQQQ? Ameritrade always claims there are no shares able to short!

    Sentiment: Strong Sell

  • Reply to

    Will TQQQ hit 100 by the end of the year?

    by judge_smailes8 Mar 4, 2014 3:50 PM
    judge_smailes8 judge_smailes8 Mar 11, 2014 4:45 AM Flag

    I am not sure whether stocks are quite as overvalued as you suggest. Yes, it is somewhat worrisome at first glance that stocks have risen so much during the past five years despite anemic economic growth. However, the FED has provided cheap financing that companies used to greatly enhance their balance sheets and provide value to shareholders which has been reflected in increased profitability. At some point the cheap financing will end, but at the same time economic growth will likely have improved by then and companies will still see increased profitability unless they have too much financial leverage. The worst case scenario would be a scenario of inflation coupled with low economic growth where profits are crimped as interests rates rise - this scenario may or may not occur.

    I think that the Nasdaq could rally for years, although not like it did in 2013. I could also see some P/E expansion from here. According to the Wall Street Journal, the trailing P/E ratio of the Nasdaq 100 is about 21 right now - last year is was 17 at this time. Although it has risen over the past year, this is still far below the P/E ratio of 102 that was reached in 2000. Also, the P/E based on projected earnings is about 19.

    As world economic growth recovers, the tech companies are nimble enough and have such high margins that a substantial increase in overseas revenue could be coupled with a massive increase in corporate profits. I can easily see TQQQ rising +500% over a four-five period of time unless we experience a major bear market during this period of time.

    I really wonder when Emerging Markets will come back. Whenever world economic growth finally recovers, I expect to see a sharp increase in Emerging Markets stocks, although granted this may not happen for a few years.

    Sentiment: Strong Buy

  • I think that TQQQ has an excellent chance of breaking through 100 by the end of the year. Tech stocks are so strong right now!

    Sentiment: Strong Buy

  • judge_smailes8 judge_smailes8 Feb 27, 2014 9:06 PM Flag

    That would be a gain in excess of 1400%. That is very unlikely to happen within the next 5-6 years. However, if there is not a sharp bear market during the next several years, then yes, I think that TQQQ could definitely rise 1000+% over the next 5-6 years.

    I don't think that investors have fully accounted for what will happen to profits of tech companies if Europe finally starts growing at a decent rate. The profits of high tech companies could explode higher if companies feel comfortable enough to really expand their budgets.

    If TQQQ had been introduced back when the Nasdaq 100 was created in October 1985, it would have soared over 1300% between October 1, 1985 and December 31, 1994, and this period (a) includes Black Monday during which TQQQ would have lost about 83% of its value between market closes on 10/5/87 and 10/26/87; and (b) excludes the tech bubble years from 1995-2000.

    TQQQ is going much, much higher.

    Sentiment: Strong Buy

  • The average closing value of the VIX between 1/3/2012 and 2/21/14 has been about 15.93 and SVXY has soared 355% during this period of time.

    However, during the 7-year period of time between the start of 1997 and the end of 2003, the average value of the VIX was much higher, averaging about 24.38.

    I really do like SVXY. However, wouldn't contango have been much lower between 1997 and 2003, or would the VIX short-term futures index (if it had been around at that time) actually have been in a state of backwardation during most of that period of time?

    I know that we all like to think that SVXY is practically guaranteed to rise, but I question whether that would have been true between 1997 and 2003...

    Sentiment: Strong Buy

  • Reply to

    Holy TQQQ! Way to go Judge!

    by bobwins_o_phile Feb 14, 2014 12:44 PM
    judge_smailes8 judge_smailes8 Feb 19, 2014 3:16 AM Flag

    Bob, look at the Direxion Daily Healthcare 3x Bull ETF. It has gone up far more than TQQQ since 2012

    Sentiment: Buy

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