Macro Plays

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Nov 6, 2008 12:29 pm

Anyone thinking of putting some money to work in ETF's with some bigger macro ideas in mind?

 
I've been thinking about buying the Ultra Long S&P (SSO), Ultra Long Small Cap (SAA), long oil (DIG) and TIPS (TIP) before too long.
 
Any thoughts or other ideas? 
Nov 6, 2008 12:44 pm

Not a bad idea with SSO and SAA.  I woudn't bet the ranch on it, but, chances are....

 
So why the long oil bet?  You really think oil's going back up significantly?
 
I also don't know if I would BET on inflation.
Nov 6, 2008 12:49 pm

I'm talking long term holds.

 
I just can't see oil staying this low for a long time. 
 
As far as inflation, I don't think it's a problem right now, which is why I would make the bet.  You can't pump all this money into the system and not have inflation.
 
I would make the bet that inflation helps the U.S. out of this mess eventually.  Who wants inflation?  Debtors.  Who's the biggest debtor of them all?  The U.S. Government. 
 
I think they need inflation.  Again, it's early, but you can pick up a pretty decent yield while you wait.
Nov 6, 2008 12:58 pm

Talk to any of the energy slanted funds (Brandywine, for one), or SMAs like Wentworth Hauser and Violich, and they'll tell you they're sticking to their guns.  WHV loaded up on energy late 2007.  They've ridden it in down since this year, and are still saying the fundamentals have not changed (not enough supply). 

D'Alonzo says the same thing. 


Nov 6, 2008 6:46 pm

I would also add the natural gas etf (UNG) to that list.  If Obama is for more alternative energy and less dependence on oil, since the U.S. can produce plenty of natural gas, that might be a good macro play.