BarTune1
441 posts
msg #139314
- Ignore BarTune1 |
11/15/2017 1:14:31 PM
For anyone interested in shorting leveraged ETF pairs, I just put on the following trade: short 1200 shares of DUST at $26.783 and 1300 shares NUGT at $29.183 ...
We can see how this turns out although it may take some time for the pair to deteriorate in value ... if and when it shows a decent profit ... I'll probably just take the money and run ... would likely just be best to leave the trade on for a longer period however ...
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BarTune1
441 posts
msg #139367
- Ignore BarTune1 |
11/16/2017 10:51:13 PM
Well, I am not really expecting to update this trade daily as it should play out over weeks or months .... but it is up +$236.50 so far .... net directional amount at risk is only $201.70 ....
Sym Qty Close Cost Chg Cost Mkt Val Gain/Loss
DUST -1300 $26.73 $26.783 -$0.05 -$34,749.00 -$34,817.90 +$68.90
NUGT -1200 $29.02 $29.183 -$0.16 -$34,824.00 -$35,019.60 +$195.60
-$69,573.00 -$69,837.50 +$264.50
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BarTune1
441 posts
msg #139730
- Ignore BarTune1 |
12/1/2017 5:03:27 PM
Well, it is a slow decay - kind of like watching paint dry - however currently up now $540.50. Net directional risk $1,137.
Sym Qty Close Cost Chg Cost Mkt Val Gain/Loss
DUST -1300 $27.09 $26.783 +$0.31 [1.15%] -$35,217.00 -$34,817.90 -$399.10
NUGT -1200 $28.40 $29.183 -$0.78 [-2.68%] -$34,080.00 -$35,019.60 +$939.60
-$69,297.00 -$69,837.50 +$540.50 +0.77%
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mahkoh
1,065 posts
msg #139740
- Ignore mahkoh
modified |
12/2/2017 2:23:41 PM
Could you check what you paid in cost to borrow so far?
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BarTune1
441 posts
msg #139746
- Ignore BarTune1 |
12/3/2017 11:29:07 AM
mahkoh,
i'm using TD in Canada and there are no borrow costs here ... if they were being charged, it would clearly impact the gain/loss ... if your account is subject to borrow costs ... you could still enter the trades synthetically using short deep in the money call options without having to incur borrow costs ... in fact, depending how long you went out, you might also capture some option time premium which would also decay in your favor ...
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risjr
229 posts
msg #140002
- Ignore risjr |
12/11/2017 7:22:10 PM
Great call!! 3x silver or gold...did real well!
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risjr
229 posts
msg #140003
- Ignore risjr |
12/11/2017 7:23:37 PM
that is jdst...dslv
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WantingLittle
11 posts
msg #140046
- Ignore WantingLittle |
12/12/2017 9:29:32 PM
Bar, sorry for the novice question but what is "net directional risk"?
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BarTune1
441 posts
msg #140067
- Ignore BarTune1 |
12/13/2017 3:24:56 PM
because you are short both the 3x long and 3x short, you have no directional risk to the extent that the market value of the positions is equal ... to the extent that one position is larger than the other you are left "unhedged". Consequently, the positions can run against you if you get an extended move in any one direction ...
this past week or so I was underwater for a while because NUGT kept dropping and DUST kept rising ... I was short around $30K of NUGT and short $40K of DUST .... thus $10K of directional risk ...
A 10% move in the ETFs if NUGT went down would net me $3K but would cost $4K on the DUST short ...
However, today has been a good day so far ... it went the other way and I'm up around $4K on DUST dropping in value whereas the other side .... a 10% increase in NUGT has cost only $3K ....
I will update the results sometime this week
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BarTune1
441 posts
msg #140146
- Ignore BarTune1
modified |
12/16/2017 9:52:24 AM
Symbol Position Close Cost Net Change $ / % Pos Value Cost Net Gain/Loss %Change
NUGT -1200 $26.57 $29.183 -$2.61 [-8.95%] -$31,884.00 -$35,019.60 +$3,135.60 [+8.95%]
DUST -1300 $28.66 $26.783 +$1.88 [7.01%] -$37,258.00 -$34,817.90 -$2,440.10 [-7.01%]
-$69,142.00 -$69,837.50 +$695.50 +1.00%
Current position +$696.50 .... net directional amount at risk is $5,374
This is a pretty decent return over the last 30 days. I would argue that ROI should be measured as a function of the amount directionally at risk rather than the total position size given that the short positions completely offset. The only amount really at risk is the extent to which you may be over-positioned on either position due to market fluctuation.
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