what we do
Our focus is on the development of proprietary geodesic models that characterize the behavior of leveraged long/short ETFs in pairs trades using first principles of Hamilton-Lagrange-Euler mechanics. Because of tracking errors & daily compounding phenomena, equal weightings of leveraged ETFs in a pairs trade are virtually never 50-50. Daily data & graphics will show subscribers where neutral pair weightings have moved along the path of the pairs geodesic thereby providing multiple market direction & re-balance indicators.
SDS-SSO Model Update - June 9, 2009
Dear Blogger, thank you! again for subscribing to the S&P 500 long/short ETF Model and welcome to new members who just joined and new list subscribers. today's analysis 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 search-able and comments can be posted by everybody. | | | Today's Commentary
resembling the shape of a comment, the bottom trail of the geodesic grew out more today commencurate with the ever increasing S&P 500 index. i also included yet another chart in the spreadsheet which depicts the 1st & 2nd percent rate of change of vector c. the plot in yellow is a scaled down representation of theta also adjusted to reflect symmetry about the angle of 45 degrees. 45 degrees is the nominal angle associated with neutral weights at 50% for both SDS & SSO.
all the charts show perhaps the obvious at this point, the S&P 500 index has exceeded the magnitude of change since the low compared to the last phase which was downward from late january to march 9th of this year. many bloggers at seekingalpha.com are quite sckeptical, including myself, of the green shoots prognostication going on in the media. my own view is many of the large banks that recieved TARP funds when the credit crissis started have now overbought the market and are ready to start selling to make gains with those funds now that many have gotten the OK from the fed to repay their debt to the public. this may be cynical but it will become very clear what these banks have been doing in the current quarter when they start reporting Q2 earnings in july & august. so the cycle of 2008 continues in my opinion for the remainder of 2009. we'll see.
this is a good time to start raising cash and slowly add to a small neutral pair position as a hedge against potential downside moves - even if they are just a week or two long.
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Disclaimer
Equity Informatics is a developer and service provider of proprietary financial equity pricing models & trading methods. The company familiarizes subscribers with the basic thesis of our models, provides subscribers with daily neutral pair weightings and methodologies on how to use the data as intended. subscribers shall not share any information obtained from equity informatics with any other party. use of these services are granted only to and intended for the benefit of the subscriber. Equity Informatics does not offer the sale of equities nor do our trading models constitute trading advise. It is incumbent on potential clients to perform due diligence and seek a professional financial adviser to help you determine whether subscribing to the company's services are suitable for your financial situation and level of risk. No guarentees of performance are expressly or implicitly offered nor does Equity Informatics guarantee the accuracy of market information used to provide model data to our client. equity informatics does not assume responsibility for lost principal, lost gains or tax consequences.
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