Monday, December 10, 2012

T2 Software and the VTV View...12.10.12

The T2 software was sent out this weekend to all subscribers who requested it.  The VTV software (2 separate programs) is now available also..go to the option 8 button on the main ETF Mosaic site to order.  The VTV software is both very simple and very powerful in helping to assess market momentum and to capture short term opportunities.  Risk management is critical with can be seen by a quick look at the performance metrics of just trading the top 1 ETF in the 6 ETF mix.  Great returns but the potential drawdowns could cause a cardiac.
We can buffer the risk somewhat by trading the top 2, which basically cuts all number in half but the goal of VTV is really to make sure we're on the right side of the market at any given time so however each user decides to engage the program is a matter of personal risk tolerance.

On upcoming Mondays we'll look at some other ways to make use of VTV, some other VTV components and some other ways to use the power of inverse pairs to capture market opportunities.  VTV is the product of over a year's worth of research and I'll endeavor to gradually explain why it should be part of your trading (and investing) toolbox.

Below is a view of the lower VTV chart panel which illustrates the extreme volatility that trading high beta volatility (XIV and VXX) can incur.  Also note the volatility chart in the upper right hand side of the VTV Assist panel.  That's one of the reasons that the preferred trading vehicles for VTV are QQQ and SH...less volatility.