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 - July 13, 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
with the 2.5% run-up in the S&P 500 index today, the models geodesic parameters crossed over which is an indication of market direction change. the RSI indicator plot in the spreadsheet shows a similar confirmation in market direction change. lastly, coordinates in a scatter plot (not included in the spreadsheet but included below) of the geodesic parameters time rate of change shows a change in quandrants, another indication of market direction change. therefore the model is indicating a weak bullish bias in the S&P 500. the coordinates that moved into the 4th quadrant are shown as a blue asterisk. there is one other point there from 7-1-09 when the index popped but went back down. having said all that, the S&P 500 index moved in lock-step with a pattern that has repeated several times since the end of apr-2009. observe the following dates in the chart below: 4-20-09, 5-26-09, 6-24-09, 7-13-09 during expiration week, the S&P 500 index began new rallys. and each time the rally was less intense and shorter in duration. the question is will the pop in the index today repeat this pattern, less intense and shorter in duration. if so, this rally may last 3 - 5 trading days max. therefore consider building a small position in SDS over the next few days. stop accumulating if the price drops below $54.7 - $56.0 and then hold. if the pattern holds, you should be able to unload the hedge in a week or 2 for a small gain. | |
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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.
Copyright (c) 2009 Equity Informatics, LLC. All Rights Reserved.
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