Getting long term cheapest 2x leverage on Nasdaq 100

Discussion in 'Strategy Development' started by ramuk, Jul 12, 2005.

  1. ramuk

    ramuk

    For a long term (3-5 years) trade .

    Knowing that nothing is for free, how do
    I go about getting 2x leverage on the
    Nasdaq 100 index.

    I could buy QQQQ on margin (and pay margin loan fee) at the broker, or I could buy the mutual fund UOPIX (which has a 1.7 % expense ratio)

    Which one of the two options is better ?

    Are there any other options ?
     
  2. leaps are cheap right now.
     
  3. Ebo

    Ebo

    Your biggest bang for the buck is trading Nasdaq 100 Index e-mini futures. NQU05, You need an overnight performance Bond of $3,750 to control $31,250 based on last sale. You will of course have to roll over your position every 3 months.

    http://www.cme.com/edu/emini/
     
  4. ramuk

    ramuk

    Thanks for the suggestions.

    I see leaps only going out to Dec 2007.
    Are there any going further out ?

    vhehn, can you give me a few pointers on what strike price you would choose ?

    One of my objectives with this particular trade (I am already holding emini futures in another account) is to resist the temptation at short term timing. I want to basically buy and hold (for upto 5 years)

    I was reading an article by Mark Hulburt that the average holding time for a stock is now 11 months. I feel that I will have a chance at beating the crowd by holding longer.

    I would also like to mention that long term gains in the stock market are tax free in New Zealand.
     
  5. buy a futures contract