The Ultimate Leverage Investment Thread

[DcifrThs]

[ QUOTE ]
Leveraged investing means borrowing to invest. Where does borrowing fit into your plan?

Oh wait... unless you are leveraging other peoples ideas, then I think I get it.

[/ QUOTE ]

do you know what you're talking about??

Barron

[john kane]

47outs, as you likely know there are people on this forum who are very knowledgeable about the markets etc. sure, im following there posts and acting on them, just like we read poker books and act on them, i read investing forums and try to gauge what the majority of people think and particularly posters who, for whatever reason, i believe in their judgement.

anyways, i finally bit the bullet and invested in oil. £200 per $1 swing, stop loss at $90, limit sell (? if that is correct i can never remember) at $100.

kinda wish i had done all futures so i could see total profit/loss on each position, instead for gold and silver i have rolling daily positions so i cant see how much they're up/down overall.

anyways, now got:

£100 per $1 swing in gold spot price
£11.50 per $1 swing in silver spot price
£200 per $1 swing in oil
£330 per 1 yen swing per $1
£150 per 1% swing (at current price) in hong kong index
£120 per 1% swing in india index
£40 per 1% swing in norther rock

want to add 1 currency, pretty annoyed i ended my GBP/USD position (especially given it was just a hedge against my $ holdings, but oh well).
tempted to go for a little on partygaming given recent small drop in last couple of days.

[gonebroke2]

[ QUOTE ]
£11.50 per $1 swing in silver spot price

[/ QUOTE ]

is your swing trade per dollar or per penny for silver?

[john kane]

per penny sorry, my mistake.

[CrushinFelt]

Mind clarifying what price you got in at for oil as well as how you're investing in it?

[john kane]

$94.5 for daily US crude. had enough of reading so much about how oil will hit $100 i figure i could make a quick £1k if it hits $100. ill sell then as from what ive read the potential above $100 is limited.

ive been meaning to invest since it was at $80 or so but never got round to it.

[CrushinFelt]

What i mean is, if you didn't use futures to make this bet, what did you use?

[john kane]

ah sorry, i use spreadbetting which is available in the UK. www.igindex.co.uk is the site i use. tax free winnings but can't offset your losses. basically CFD but slightly larger spreads as it's tax free. i use this site for all my dealings.

[kimchi]

[ QUOTE ]
£100 per $1 swing in gold spot price
£11.50 per $1 swing in silver spot price
£200 per $1 swing in oil
£330 per 1 yen swing per $1
£150 per 1% swing (at current price) in hong kong index
£120 per 1% swing in india index
£40 per 1% swing in norther rock

[/ QUOTE ]

That's quite a large collection of positions. My estimate is you have around £150K / $300K market exposure. Many of those markets are pretty volatile. I know I keep harping on about risk in these forums, but what's your portfolio heat, and how big is the account you're using to trade these positions?

Since these positions are large (larger than some SB dealers would except, I believe) then I'd suggest using futures. I think your costs would be lower.

Also, how much overnight financing are you paying for these positions? I'd estimate it to be around £30/day.

[john kane]

i know these are pretty risky but i feel i have stop losses at safe enough amounts (8% currencies, 15-20% commodities, 25-30% india and china indices). the account in theory has £27k, but at the moment only have 12k deposited as i dont bother putting in a full stop loss for something like gold where a drop to 700 in a few days is very unlikely.

forgive my overwhelming lack of knowledge at times, but when you say futures do you mean contracts for say march 08? if so, all but gold and silver (gold becuase it was the first trade i did and didnt know the difference and silver becuase i forgot and just did daily rolling) are on monthly or quarterly futures (if i am using the right term, not sure).

not sure about overnight financing, i know it costs me 7% annually, but for gold for example i know i lose 15 cents overnight i.e. if spot price is $803.50 at closing, it automatically rebuys me at $803.65. i worked this out at about 7% annually so it makes sense i think.

my two final positions im thinking:

long sugar. i was planning to add to my gold position by an extra 20%, but instead ill put this on sugar to diversify a little. this would keep within the 17.5% i have for commodities,; 10% gold, 2.5% silver, 2.5% oil, 2.5% sugar.

also the other currency trade i will add is:
CHF/GBP so long swiss franc vs pound.

these two additions are based on what ive read on kitco and what jim rogers says.

is there anyway to read more about what jim rogers says, i enjoy reading about his opinions (do you agree with him?)


also i really really really need to find a way to invest in the yuan, seems like minimal downside but huge upside.