EWA and SPY
TenPercent
Is the U.S. dollar exchange rate an important factor when
considering to invest in EWA (the iShares Australia ETF which
is the Australian equivalent to our S&P 500)?
Because of that article I provided a link to a couple weeks ago,
I don't think I'll be leveraging the S&P by buying SSO--basically
SSO can go up roughly twice the amount SPY does over
a short time frame. However, over a longer period like six-months, for
example, SSO might actually underperform SPY, even if
both have been rising in value for months. Re-read the article I
mentioned to learn more.
For this reason, next month, I may buy EWA instead of SSO. In my
humble opinion, if you want to leverage SPY, buy EWA, not SSO.
But I'm wondering how important the dollar exchange rate is in this
kind of trade? If the dollar strengthens considerably while you own
EWA, how much of a hit will you take, if any?
I'm hoping EWA works something like Brazil sovereign bonds, which I
believe are U.S. dollar-denominated, so there's no exchange rate risk.
Ed
Click on prospectus.
"TenPercent" <tenpe...@not-real-address.com> wrote in message
news:46cc792d$0$79277$892e...@auth.newsreader.octanews.com...
Alan Bowler
>
> But I'm wondering how important the dollar exchange rate is in this
> kind of trade? If the dollar strengthens considerably while you own
> EWA, how much of a hit will you take, if any?
When discussing two currencies, both called the "dollar",
try to specify which one you are referring to at any time.
TenPercent
> When discussing two currencies, both called the "dollar",
> try to specify which one you are referring to at any time.
========
You are right A.B. Excuse me, I should have said, "If USD
strengthens against AUD..."
I was so tempted to buy EWA early this morning, but resisted.
Gonna be disciplined and wait for next month.
Nice 3 percent move in EWA today.
TenPercent
Marlowe
out on it but with that said, I still like it, I just had too tight a stop
on it. You can see my discussion on
http://rocketscienceinvesting.blogspot.com
"TenPercent" <tenpe...@not-real-address.com> wrote in message
news:46cc792d$0$79277$892e...@auth.newsreader.octanews.com...
>
Flasherly
wrote:
A stronger dollar is too broadly favored by FOMC/G7 interests, for
pretty much anything except a run on bad-boy, depressed financial
issues (feeling ballsy, might want to hang in with SRS). Considering
both a couple weeks ago, I decided on and rode EWG through recent
spats. Mixed blessing considering EWA's two day 10% uptick (plenty of
'em elsewhere, too, on pickings that ain't even over yet, should that
be what this is leading into).
http://finance.yahoo.com/q/bc?s=SSO&t=1y&l=on&z=m&q=l&c=ewg,ewa,fxe,fxb,ews
TenPercent
Flasherly, another thing I really like about EWA is you get paid a fat
dividend of roughly 4 percent. EWG is about 1.5 percent if bought now.
Flasherly
wrote:
> Interesting site, Marlowe. I will continue reading it.
>
> Flasherly, another thing I really like about EWA is you get paid a fat
> dividend of roughly 4 percent. EWG is about 1.5 percent if bought now.
Now then would be the time. Add 4% to the last two days trading on a
nice run. I bought EWG a month ago for a relative good standing among
aggressive European returns. EWC is another similar interest. Unlike
being locked decidedly into traditional funds, though, national
exchange traded sector plays may require careful monitoring for shifts
in momentum. A lot of being busy across spread diversity.
TenPercent
paid a 4 or 5 percent dividend like EWA? I guess the last time the
S&P paid that much was in the '70's or early '80's.
TenPercent
I'm tempted to pick up some Walmart since WMT is at it's channel low.
Since 1999, it seems to move in a trading range between the low 40's and
50 (well, really even higher but I wouldn't count on it reaching 60
anytime soon). Still it could be a fairly safe stock to buy at 43 and
sell at 50 or 48. It might be a relatively safe way to pick up 10 percent.
Any thoughts? Thoughts from ETF traders especially welcome.
Individual stock traders welcome, too.
FrediFizzx
You just missed a 10 percent increase in BIG this week if you want to go
retail. I think I would pick TGT over WMT as TGT does some pretty slick
TV ads and lots of them. But they are both kind of sluggish and rated C
hold on Schwab. But 'tis the season to start thinking of retail and
Cramer claims it might be retail's time in the business cycle. I'm
stickin' with BIG. It's my wife's pick and I figure women know about
these "retail" things.
Yeah, I am tending more toward ETF's myself especially for foreign. I'm
holding EFA, EWS, EWW, DLS, PIO, VWO, XRO, and VPU. I loaded up on EFA
during this correction to balance out risk in our large position in
JAOSX which has a fair amount of emerging markets exposure.
Fred
Flasherly
wrote:
That's where they say favorite money is going these days - safe bets
are largecaps. That and stomaching global for Bernanke's slower
economy. Coupled with the aftereffect of the crunch factor, there's
still pickings within stability (also being said, relative to crunch
fear factor, looking like smoother sailing). WMT sounds like win-win.
TenPercent
> That's where they say favorite money is going these days - safe bets
> are largecaps.
========
Yeppers, I started dollar-cost averaging into Large cap Value 2 years
ago in September, with VIVAX.
TenPercent
in a major downtrend during most of this 5-year
cyclical bull (we're still within a secular bear until at
least 2017 or so).
I mean although Walmart has been trading between roughly
40 and 50 for the last two-and-a-half years, it could just as easily
start trading between 30 and 40, since in the first half of this
5-year cyclical bull, it was trading between 50 and 60. Then in
early '05 moved to the current 40 - 50 range.
This is a troubling stock. Good company, great store,
troubling stock.
Now I remember another reason why I prefer ETFs.
First half of bull: 60 - 50
Second half: 50 - 40
Next 2.5 years (?): 40 - 30 ???
Youch!
At least they've raised the dividend--now 2 percent.
I think I'm gonna pass on Walmart, tempting as it may be in
the low 40's.
Flasherly
wrote:
http://finance.yahoo.com/q/ta?s=WMT&t=2y&l=on&z=m&q=l&p=m200,m200,m50&a=&c=wmt
Really? Tempting to take a piece of that on technicalities. Looks
interesting from the standpoint of a timer, anyway. Real steady eddy
across two-year's cyclical movement, and ripe for another 20% uptick.
Wildcard is now how much store modest productivity is going to be seen
for immediately limiting domestic returns. Recession, doubt it,
although this crunch may linger on like a sniveling cold.
http://seekingalpha.com/article/44190-wal-mart-s-six-month-results-number-of-shoppers-rising
'Push to shove' - good point, perhaps again at a less rapid rate,
although shouldn't be anywhere near the sweat of holding FXI, ILF,
DIG, and the likes. Token $3-5K shares - another every time I turn
around catching my eye is MCD. Hey, got'ta make those SUV payments to
show at the drive-thru. ;)
Ed
"TenPercent" <tenpe...@not-real-address.com> wrote
> (we're still within a secular bear until at
> least 2017 or so).
bear market
Definition
A prolonged period in which investment prices fall, accompanied by
widespread pessimism. If the period of falling stock prices is short and
immediately follows a period of rising stock prices, it is instead called a
correction. Bear markets usually occur when the economy is in a recession
and unemployment is high, or when inflation is rising quickly.
I don't know where you people get this secular bear crap.
Where is:
The recession?
High unemployment?
Rapidly rising inflation?
The prolonged period of falling stock prices?
TenPercent
>
> [some stuff about a bear market]
========
Sounds to me like that's more the definition of a /cyclical/ bear, not
a /secular/ bear.
During a /secular/ bear, which could last a long time (like
17 years plus), the market can still reach all-time new highs, as
happened during the 1966-1982 /secular/ bear.
But the new highs will be an added fraction of the preceding
/secular/ bull's high, like maybe 30 to 50 percent higher or so--not
10 /times/ higher, as happens in a /secular/ bull.
Examine S&P 500 charts from '48 to '66 and compare to '66 to '82.
Then look at '82 to 2000.
That's why I believe the S&P 500 is headed to another all-time new
high between 1650 and 1900, even though we are in a /secular/ bear.
1650 to 1900 is only a fraction above 1550, the approximate high of
the last /secular/ bull (from '82 to 2000).
1900 is not ten /times/ higher than 1550, but it is higher. In '82,
the S&P 500 was roughly at 140. In 2000 at the end of
the bull, it was more than 10 times higher :-)
So new all-time highs can be achieved during /secular/ bears. Again
compare the bear of '66 - '82 to the bull of '48 - '66.
(I actually think we could reach 2200 sometime between now and 2017,
but we're still in a /secular/ bear.)
Siddharth - ibookdb.net
Personally, I'd rather add to my position in TGT than invest in WMT. TGT
has been on an upward path for a long time now and is my best large cap
performer and IMHO more likely to reach 70 faster than WMT reaches 50.
Ed
"TenPercent" <tenpe...@not-real-address.com> wrote in message
news:46d404ae$0$79240$892e...@auth.newsreader.octanews.com...