So I read this...... it's about the DUG and how someone expects it to go down with oil....
For those of us able to read, "Know what you are investing in" not how it's calculated, all the etf's aren't perfect, for that matter most indexed spdrs aren't perfect with the way they calculate themselves either.
Funny thing is that the article goes into how ETF's are Calculated, and then talks about how it's the service index, and not oil as an ETF.... Which is wierd....
Because the point should be specifically and clearly "don't buy the wrong thing to short the wrong thing"
Seems clear to me, like don't buy the SDS to short the nasdaq..... I could go on and on, about what not to short to short something else..... Let me just tell you don't buy the skf to short materials either....
WFT with this stuff...
Monday, May 26, 2008
Stupidity
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2 comments:
Interesting article, but nothing really new. None of the short or ultrashort index etf's are designed for long term tracking. They all say something to the effect of following the "daily" price performance.
For example: http://tinyurl.com/2lypmz
(Read the objective and look for the word "daily".)
Also, DUG tracks the inverse of oil AND GAS, and thus it is not a clean inverse index, but as Trader Mike says, it's awfully hard to find shares of USO to short so that leaves either option trading or using DUG as a proxy.
That it tracks "daily"... The ridiculous thing is expecting the DUG to track oil, and not Oil service.... Daily or not.
weird that one can't find USO to sell...I wonder if that is an anomalie.
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