SDS-SSO Model Update - April 28, 2009

Dear Blogger, thank you again for subscribing to the S&P 500 long/short ETF Model and welcome to new members and list subscribers. SDS-vs-SSO-20090428_subscriber.xls.zip analysis for paypal subscribers is available for download. ignore the missing data error message that may pop-up when opening up the file. Excel for Windows looks for metadata that Excel for Mac doesn't generate. if you ever misplace your login, send me a message using the email you originally provided when subscribing through paypal. visit the blog for an archive of all subscriber updates and alerts. the archive is available to the public, is search-able and comments can be posted there as well. Today's Commentary 1) looking at the charts in the spreadsheet and you'll see that there has been bias change from SSO to SDS. also, the PID re-balance indicator crossed the x-axis. hence: consider re-balancing your pair tomorrow if your neutral. consider changing the polarity of your pair bias towards SDS if you are aggressive. 2) the markets gave up another lackluster of a performance in the broad indexes today. we're still just drifting in a no-man's land. as i mentioned in the previous EOD commentary, another PID model i'm looking at possibly superseding the current one has NOT crossed the x-axis. i'll keep you appraised of the changes here in the commentary for a while. the polarity change signal however has not been altered and this signal should be looked at closely over the next few days. the chart shows this is about the 4th attempt in the last 3 weeks the polarity has tried to change. the first 3 attempts we unsuccessful. this is all characteristic of trading range performance. the market likes to play head fakes and cry wolf. i am attempting to mitigate these psychological factors with a sound model. the current re-balance signals aren't making it easy to accomplish this. this is why i'm looking at another source of data but doing the same analysis to come up with a new PID tuning algo. 3) today i initiated 2 pairs trades in my brokerage account to track actual trades to compare against the models back-testing results. 1 pair is neutrally balanced according to model signals and the other is an aggressive scenario following re-balance and polarity change signals. i will include an overview and summary of the results each weekend. best regards, mike james Managing Member Equity Informatics, LLC phone:302-220-3864