The Daily Rebalancing Funds - Are They Really Dangerous?

The daily rebalancing funds are actually pretty interesting. There's a mathematical relationship between the return, the interest rate, and the volatility in these leverage funds. They get picked off by the prop desks at the banks and hedge funds every day. I don't recommend the use of leverage ETFs long term because they're not mechanically required to rebalance into down days. You can always beat them generally by using futures or something where rebaling is discretionary rather than where the rebalancing is forced.

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Rebecca Hotsko chats with Logan Kane, who is an author and entrepreneur and is currently a writer for Seeking Alpha. Logan talks about the difference between tactics and strategies, his thoughts on how to be a better bull with IJR and IJH, his thoughts on how to be a better bear with VMSXX and VMFXX, and much more!

IN THIS EPISODE, YOU’LL LEARN:

00:00 - Intro

02:12 - How to be a better bull with IJR and IJH.

03:12 - What’s the difference between tactics and strategies?

16:31 - Are the new AI platforms like ChatGPT a major threat to Google’s status as the top search engine platform long term?

18:17 - How to be a better bear with VMSXX and VMFXX.

26:35 - Why bank stocks are Logan’s top stock picks for 2023, and which banks he thinks offer the best risk/reward opportunities.

35:46 - What return stacking is and how this strategy works?

46:02 - An overview and analysis of ETFs that implement this strategy: PSLDX, NTSX, TYA.

57:22 - His thoughts on the Grayscale Bitcoin ETF (GBTC).

And much, much more!

*Disclaimer: Slight timestamp discrepancies may occur due to podcast platform differences.

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Related Episode: Listen to MI230: Buffett Indicator Says Market Is Overvalued w/ Lance Roberts, or watch the video.

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