"Investors should not become overconfident; bear market rallies have caught investors off-guard in the past and this may be more of the same," cautions Glenn Rogers.
And while the contributing editor to Internet Wealth Builder believe we may be seeing only a bear market rally, he suggests, "For aggressive investors, leveraged ETFs offer great short-term profit potential."
"For aggressive investors, leveraged ETFs offer great short-term profit potential but you need to watch them carefully because they are very volatile. There are now leveraged ETFs that run at three times the underlying value of the stocks they hold.
"One example is the Direxion Financial Bull 3X ETF (NYSE: FAS). It came out last November and opened at $32.68 but has since fallen as low as $2.32. The shares are now in a buy range for active traders -- but beware of the volatility.
"If you like energy at these levels (and I do), look at the Direxion Energy Bull 3X ETF (NYSE: ERX). It has rallied from its low of $16.23 but is still more than 60% off its high of $62.63.
"Note that neither of these are formal recommendations. Because of their volatility and the need for constant monitoring, they are only suitable for very active traders. But if you fall into that group, take a look at them.
"My view is that although this is a scary market, there are great profit opportunities for those with the stomach (and the cash) to handle the risk.
"That said, the one traditional investing maxim I still like is dollar cost averaging. Keep buying a little each month and over time you'll be closer to being right than if you didn't participate at all."
Steven Halpern's TheStockAdvisors.com offers a daily look at the latest market commentary and favorite stock picks and investment ideas from the nation's leading financial newsletter advisors.
Before the bell: Stocks futures steady ahead of GDP, housing data
Google's plan for netbook PCs moves higher into the clouds
So long peak oil, here comes peak uranium
Reader Comments (Page 1 of 1)
4-02-2009 @ 4:10PM
TaurusTrader said...
I like TNA, 3X small caps, in an upward moving market. If the general market is doing good, the small caps usually do better, so does TNA.
I like FAS too.
TaurusTrader
http://www.taurustrader.wordpress.com