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Don:
I have not done a good enough job of updating the Omega List about the O-Fund
exercise. I have been writing about it so much in my newsletter, and there
is such a crossover of readers between the newsletter and the OL, I have been
hesitant to add to much to the OL.
However, I will try harder to make the exercise make sense.
So far the O-Fund managers have had a chance to build 3 different 2 week
funds. They have shown a lot more willingness to take risk than the X-Fund
managers.
What has been interesting to me is the reaction of the O-Fund managers. I
believe they are experiencing an awakening to the possibilities of trading
such a narrow based index and portfolio position.
That was what I was hoping for. I was hoping some of the intellectual
resources of the OL would apply themselves to the subject and show us ways to
trade X-Funds. The idea is that X-Funds are designed so the index grows in
value over time. I wanted to see if that were true, and how a group or
non-Steidlmayer trained traders could do at the same task. We won't have a
true picture of this until we have enough data points to analyze, but so far
so good.
The results we have seen so far are as follows (this includes some
corrections from my newsletter):
Bill Wynne 773
Barry Viljoen 1019
John Lothian 1040
Bob Heisler 1053
Mark Brown 787
One of the interesting aspects of this exercise is looking at the market from
a plural rather than a singular market point of view. With an X-Fund or
O-Fund you have 4 positions to track and interact with. With just one
contract on you have a singular approach. There are so many more
possibilities to the plural approach that this fresh canvas might just give a
trader an edge because the territory is so new to them and many other traders.
This is not a product that has a target audience. It is not retail and not
institutional. It is a product that may well just develop its own audience
of people who can find a way to look at the X-Funds and the market
differently and make a lot of money from it. What that takes is exposing
the contract and concept to some very smart people, discuss it, chew it up
and see what can be done with it.
I think the Omega List is just such a community of trader with the smarts and
the tools to be able do that. I don't say that to suck up. I say that with
respect for this as one of the best trading related forums around.
The truth is we don't know how to use these X-Funds, or our O-Fund creations,
to the maximum utility yet. But I can begin to see the wheels begin to turn.
And the most interesting uses and observations about the X-Funds are yet to
come.
Stay tuned.
Regards,
John J. Lothian
Disclosure: Futures trading involves financial risk, lots of it!
In a message dated 3/1/2002 12:04:29 AM Central Standard Time,
dbewers@xxxxxxxxxxxxx writes:
<< John I am not sure what purpose this all serves since you have never
published any results for the weekly rounds or for the X-funds for that
matter? What is the point of this exercise?
My picks long may Tulips, short June Ice cubes, am I making my point?
don ewers >>
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