StockFetcher Forums · General Discussion · THIS is making me VERY Nervous<< 1 2 >>Post Follow-up
6,396 posts
msg #76473
Ignore karennma
7/15/2009 12:01:16 PM

RPT-Massachusetts begins probe of leveraged ETFs
Wed Jul 15, 2009 11:34am EDT

BOSTON, July 15 (Reuters) - Massachusetts' top securities regulator has begun an inquiry into the sales practices of three firms involved in structuring leveraged exchange traded funds, which can be used to bet against Treasury bonds.
Massachusetts' Secretary of State William Galvin said in a statement on Wednesday that he had sent letters to three firms heavily involved in structuring these funds: Rydex Investments, Direxion Funds, and ProShares.

"Since 2006 these products have become increasingly popular. Yet, due to the daily nature of the leverage employed, there is no guarantee of amplified annual returns, and they generally incur greater transactions costs than traditional exchange traded funds," Galvin said.

Leveraged exchange-traded funds are generally index funds that seek to offer magnified or inverse-magnified returns of major stock benchmarks through the use of leverage on a daily basis. They often use derivatives like index options, index futures, total return swaps and equity swaps to increase or reduce market exposure. (Reporting by Jason Szep, editing by Gerald E. McCormick)

Thomson Reuters 2009 All rights reserved

Whatever the gov't decides to do, won't be good for traders.

6,396 posts
msg #76475
Ignore karennma
7/15/2009 12:17:26 PM

I need to move OUT Of THE COUNTRY.
The fascism here is really starting to get to me.
But where .. ?
Nowhere to run ...
Nowhere to hide ...

10,153 posts
msg #76477
Ignore johnpaulca
7/15/2009 12:58:09 PM


622 posts
msg #76485
Ignore luc1grunt
7/15/2009 3:23:17 PM

at least the fishing is good. :)

10,153 posts
msg #76486
Ignore johnpaulca
7/15/2009 3:44:19 PM


805 posts
msg #76512
Ignore marine2
7/16/2009 12:51:10 AM

Yeah, and buy a nice tillable rock farm.

2,025 posts
msg #76516
Ignore alf44
7/16/2009 1:23:55 AM

...or...maybe...just maybe...someone NEEDS to look into some of those Triple Inverse ETFs !!!

Howzabout THAT !!!


There is DEFINITELY something inherently F'cd UP about the action in FAS / FAZ !

Those "trading vehicles" (and I use that term loosely) are agents of the ANTI-CHRIST !

Designed to DEVOUR your very soul !!!



622 posts
msg #76519
Ignore luc1grunt
7/16/2009 6:33:45 AM

short both Alf. do the math.

273 posts
msg #76521
Ignore SFMc01
7/16/2009 7:10:50 AM

luc1grunt: Would you please elaborate on your comment, " short both Alf. do the math." What do you mean? Short both at the same time?

Thank you .... Steve

6,396 posts
msg #76535
Ignore karennma
7/16/2009 10:32:37 AM

What he means is, that altho' these are 3X ETFs, over the long haul, you can make more money shorting them rather than going long .
I've never shorted FAZ nor FAS, but I have "done the math".
I've watched FAZ since it's inception, and I know for a fact, that when the market goes UP, you make more money shorting FAZ, than buying FAZ when the market goes down.
And because these ETFs are revalued everyday, they end up going down CONSISTENTLY.
That's why Direxion had to do a R/S last week.
FAZ was R/S 1:10 a week ago.
** I'm sure if it hadn't been, it would've hit ZERO yesterday! **
FAZ is a true ZERO-SUM game.
That's probably why they're being investigated.
I also understand that some brokerage firms are now NOT allowing you to buy Direxion ETFs on margin.
That tells me something!!
I BET if you call your broker, he'll tell you they've changed the margin requirements on Direxion ETFs.

StockFetcher Forums · General Discussion · THIS is making me VERY Nervous<< 1 2 >>Post Follow-up

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