Sentiment Speaks: Greed Is Not Good

As many of you know, I run a trading room with well over 3000 members, and have over 450 money manager clients. I have seen the good, the bad, and the ugly as far as what traders and investors do through the years. And, no matter how much I warn about the pitfalls in the market, many chose to ignore me, and eventually learn on their own the hard way.
First, I would suggest you begin by reading an article I wrote several years ago, which should describe what every new trader/investor goes through as they begin their career. And, if it sounds familiar, well, then you are in good company, as most of us have gone through it. The question is if you will learn from it. Unfortunately, most do not.
Leveraged ETF’s
But, what makes it even worse is the advent of the leveraged ETF’s, which significantly exacerbate the situation noted in the article above.
You see, most people do not understand how they work. And, yes, that even includes analysts. They are designed in such a way that if you are not catching a strong trending move perfectly, they will lose money. Even if the market is moving sideways, these leveraged ETF’s lose money. And, if the market moves down, well, they lose money twice or three times as fast. So, unless you are able to time the market absolutely perfectly, then you should NEVER, EVER, EVER buy and hold one of these instruments. They are designed to be a trading vehicle and nothing more.

This post was published at GoldSeek on 4 September 2017.