Quote Originally Posted by Pascal View Post
As of now, the basic findings are the following:
1. If you trade one instrument with high leverage (for example TNA/TZA) and do not mind the drawdown risk, then adding GDX will not help create better returns. In fact, GDX would even hurt the TNA/TZA returns.
2. If you use TWM/RWM (double leveraged), then a combination with GDX improves the returns.
3. If you use IWM and GDX then staying with only GDX is better. But then GDX is more volatile than IWM, which means larger drawdowns.
Pascal,
Do you have any significant indication yet about which allocation is providing the best long term risk-adjusted returns between 100% of the time only in TNA/TZA (option 1) and a combination of TWM/RWM + GDX (option2)?
Billy