ProFunds 2017 YTD returns...

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TSPBuilder
Posts: 256
Joined: Tue Jun 19, 2012 2:14 pm

ProFunds 2017 YTD returns...

Post by TSPBuilder »

Greetings fellow investors! 2017 is off with a bang as my YTD (1/31/17) came in at 18.66%

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evilanne
Posts: 1886
Joined: Thu May 14, 2015 6:52 pm

Re: ProFunds 2017 YTD returns...

Post by evilanne »

TSPBuilder wrote:Greetings fellow investors! 2017 is off with a bang as my YTD (1/31/17) came in at 18.66%

So are you using leveraged funds?

GSFlyguy
Posts: 6
Joined: Tue Nov 29, 2016 12:22 pm

Re: ProFunds 2017 YTD returns...

Post by GSFlyguy »

How? :?: :?: :?: :?:

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cswift01
Posts: 819
Joined: Thu Dec 08, 2016 10:46 am

Re: ProFunds 2017 YTD returns...

Post by cswift01 »

TSPBuilder wrote:Greetings fellow investors! 2017 is off with a bang as my YTD (1/31/17) came in at 18.66%


Are you adding all of the percentages per fund?

Me


crondanet5
Posts: 4324
Joined: Tue Aug 19, 2008 8:51 pm

Re: ProFunds 2017 YTD returns...

Post by crondanet5 »

skie are you using this program?

skiehawk11
Posts: 2116
Joined: Wed Jan 05, 2011 2:32 pm

Re: ProFunds 2017 YTD returns...

Post by skiehawk11 »

No. I wouldn't touch ProFunds with a ten-foot pole. The fees are outrageous and not worth the increased volatility experienced on a daily leveraged fund. It'd be cheaper (fee wise) to invest in deep-in-the-money option calls for an underlying ETF (more leverage too). A trick is to make sure the options delta is .60 or higher so you get a 60 cent movement or higher per dollar movement on the ETF.

On another note, the returns calculated for leveraged funds are misleading as the returns are calculated as log returns and adjusted daily. This results in contango or backwardation distorting the actual returns shown. I'm highly surprised TSPBuilder has the same return (in his account presumably) as what the account shows. Calculating the returns on a daily basis, his account should have experienced around 16.7% return which is around 2 percent less showing on the returns page (contango baby).

TSPBuilder
Posts: 256
Joined: Tue Jun 19, 2012 2:14 pm

Re: ProFunds 2017 YTD returns...

Post by TSPBuilder »

evilanne wrote:
TSPBuilder wrote:Greetings fellow investors! 2017 is off with a bang as my YTD (1/31/17) came in at 18.66%

So are you using leveraged funds?


Good Afternoon evilanne :)

Yes I was. 90% of it was in Ultra Latin America which is a 2x fund that is very consistent for me. There were a couple days I was fortunate to trade into Precious Metals(1.5x) to catch the third reoccurrence of a bump up for a day and then return to Latin when it after it started up after a couple day down.

TSPBuilder
Posts: 256
Joined: Tue Jun 19, 2012 2:14 pm

Re: ProFunds 2017 YTD returns...

Post by TSPBuilder »

GSFlyguy wrote:How? :?: :?: :?: :?:


Good Afternoon GSFlyguy,

Forgive my laziness. Please see my reply to evilanne for details. If you need more, I'll be happy to share.

Tim

TSPBuilder
Posts: 256
Joined: Tue Jun 19, 2012 2:14 pm

Re: ProFunds 2017 YTD returns...

Post by TSPBuilder »

cswift01 wrote:
TSPBuilder wrote:Greetings fellow investors! 2017 is off with a bang as my YTD (1/31/17) came in at 18.66%


Are you adding all of the percentages per fund?

Me


Greetings "Me" :)

I have a spreadsheet that just takes the current days balance of my portfolio and divides it by the balance on 1/1/17.

Tim

TSPBuilder
Posts: 256
Joined: Tue Jun 19, 2012 2:14 pm

Re: ProFunds 2017 YTD returns...

Post by TSPBuilder »

skiehawk11 wrote:No. I wouldn't touch ProFunds with a ten-foot pole. The fees are outrageous and not worth the increased volatility experienced on a daily leveraged fund. It'd be cheaper (fee wise) to invest in deep-in-the-money option calls for an underlying ETF (more leverage too). A trick is to make sure the options delta is .60 or higher so you get a 60 cent movement or higher per dollar movement on the ETF.

On another note, the returns calculated for leveraged funds are misleading as the returns are calculated as log returns and adjusted daily. This results in contango or backwardation distorting the actual returns shown. I'm highly surprised TSPBuilder has the same return (in his account presumably) as what the account shows. Calculating the returns on a daily basis, his account should have experienced around 16.7% return which is around 2 percent less showing on the returns page (contango baby).


Good Afternoon skiehawk11,

Forgive me for correcting you but there are no fees with Profunds except a yearly maintenance fee of $15 for my IRA. All other fees are waived every year for at least the past ten years the I have been with them. See corroboration of this fact in the prospectus , in the section under fees, the last line of the should say they are waived for the current year until November something. I can't look up the specific quote from my current location but I know it's there because they were a month late revising the prospectus from last years waiver.

I also don't understand your fear of volatility. Don't get me wrong, it really is an unhappy in paradise when I'm in a fund position that is opposite the market direction but this is minimized (for me by knowledge in common patterns using a two moving average tool over a three month to 5 yr span.

On the difference in the returns, all I can tell you is I know what my starting balance was and I know what my current balance is and I made 8 trades among approx 5 funds during the month. I try to maximize which one to be in in the coming days and move accordingly. It's just like being in the TSP to me when we had the 4 IFT's but I get the bonus of more trades for no cost and I make money in down trends instead of having to park it in the G and wait for the next up trend. Well, and I can make more returns than the index.

It's not for the faint of heart but investing isn't no matter how you do it. Pick a process. Prove it workable or not. Learn it advantages and disadvantages. Create rules that work more than they don't and make a profit. I've been refining this process since 2000 and it has done me well and look forward to sharing it with anyone who has the fortitude.

Please forgive me if that got defensive. I get a lot of nay-sayer's saying you can't possibly do that and not with that company. Keep a mind open to the possibilities fellow investors.

Live long ...and prosper :)

skiehawk11
Posts: 2116
Joined: Wed Jan 05, 2011 2:32 pm

Re: ProFunds 2017 YTD returns...

Post by skiehawk11 »

TSPBuilder wrote:
skiehawk11 wrote:No. I wouldn't touch ProFunds with a ten-foot pole. The fees are outrageous and not worth the increased volatility experienced on a daily leveraged fund. It'd be cheaper (fee wise) to invest in deep-in-the-money option calls for an underlying ETF (more leverage too). A trick is to make sure the options delta is .60 or higher so you get a 60 cent movement or higher per dollar movement on the ETF.

On another note, the returns calculated for leveraged funds are misleading as the returns are calculated as log returns and adjusted daily. This results in contango or backwardation distorting the actual returns shown. I'm highly surprised TSPBuilder has the same return (in his account presumably) as what the account shows. Calculating the returns on a daily basis, his account should have experienced around 16.7% return which is around 2 percent less showing on the returns page (contango baby).


Good Afternoon skiehawk11,

Forgive me for correcting you but there are no fees with Profunds except a yearly maintenance fee of $15 for my IRA. All other fees are waived every year for at least the past ten years the I have been with them. See corroboration of this fact in the prospectus , in the section under fees, the last line of the should say they are waived for the current year until November something. I can't look up the specific quote from my current location but I know it's there because they were a month late revising the prospectus from last years waiver.

I also don't understand your fear of volatility. Don't get me wrong, it really is an unhappy in paradise when I'm in a fund position that is opposite the market direction but this is minimized (for me by knowledge in common patterns using a two moving average tool over a three month to 5 yr span.

On the difference in the returns, all I can tell you is I know what my starting balance was and I know what my current balance is and I made 8 trades among approx 5 funds during the month. I try to maximize which one to be in in the coming days and move accordingly. It's just like being in the TSP to me when we had the 4 IFT's but I get the bonus of more trades for no cost and I make money in down trends instead of having to park it in the G and wait for the next up trend. Well, and I can make more returns than the index.

It's not for the faint of heart but investing isn't no matter how you do it. Pick a process. Prove it workable or not. Learn it advantages and disadvantages. Create rules that work more than they don't and make a profit. I've been refining this process since 2000 and it has done me well and look forward to sharing it with anyone who has the fortitude.

Please forgive me if that got defensive. I get a lot of nay-sayer's saying you can't possibly do that and not with that company. Keep a mind open to the possibilities fellow investors.

Live long ...and prosper :)


TSPBuilder,

To clarify a few things:
1. The expense ratio with the contractual waiver is still 1.78 percent. That's insane. You can get the same performance or better long term (check 10-year returns or since inception) net of fees with Vanguard. For instance, the best performing ProFunds is Consumer Services with an expense ratio of 1.56% (contractual costs waived). Vanguard's consumer services ETF return from the same time period is 9.29 percent with an expense ratio of .10% You're essentially paying for them to risk your money and reap almost 2 percent returns on no risked capital on their part. No thanks. :) To further the point, see the calculator below.

http://www.telegraph.co.uk/investing/isas/investment-fees-calculator-how-much-will-charges-affect-your-ret/

I assumed 1,000 dollars/pounds start (currency is irrelevant for this example) with no contributions for 30 years.

Profunds - 9.86% return / 1.56% fee - 10,771 dollars/pounds
Vanguard - 9.29% return / .09% fee - 13,994 dollars/pounds

My recommendation over 30 years returned 30 percent more and all that changed drastically was the fees. Fees kill. Don't pay them.

2. I have zero problems with volatility. However, volatility + leverage = nightmare. One day, you can earn x percent and long term you can lose x percent. Over time, daily leveraged funds will eventually lose out due to contango. You have to know what you're doing. It seems you do though. :) It's math. You can't cheat it.

3. It seems you don't buy and hold but go into funds depending on the market climate so my example doesn't really matter in this case. :) I think if you have averaged 12 percent return CAGR over the past 10 years net of fees then you have your process down and you've also managed to beat 90+ percent of all professional portfolio managers in the world.

My biggest gripe is advocating a sophisticated system that utilizes leverage like yours to the average investor. Most average investors will get burned because they have no idea what they're doing. I personally use leverage at times, but sparingly. Or I'll write puts at price points I wish to buy certain stocks and collect income until the price of the stock reaches what I'm willing to pay for it.

TSPBuilder
Posts: 256
Joined: Tue Jun 19, 2012 2:14 pm

Re: ProFunds 2017 YTD returns...

Post by TSPBuilder »

skiehawk11 wrote:
TSPBuilder wrote:
skiehawk11 wrote:No. I wouldn't touch ProFunds with a ten-foot pole. The fees are outrageous and not worth the increased volatility experienced on a daily leveraged fund. It'd be cheaper (fee wise) to invest in deep-in-the-money option calls for an underlying ETF (more leverage too). A trick is to make sure the options delta is .60 or higher so you get a 60 cent movement or higher per dollar movement on the ETF.

On another note, the returns calculated for leveraged funds are misleading as the returns are calculated as log returns and adjusted daily. This results in contango or backwardation distorting the actual returns shown. I'm highly surprised TSPBuilder has the same return (in his account presumably) as what the account shows. Calculating the returns on a daily basis, his account should have experienced around 16.7% return which is around 2 percent less showing on the returns page (contango baby).


Good Afternoon skiehawk11,

Forgive me for correcting you but there are no fees with Profunds except a yearly maintenance fee of $15 for my IRA. All other fees are waived every year for at least the past ten years the I have been with them. See corroboration of this fact in the prospectus , in the section under fees, the last line of the should say they are waived for the current year until November something. I can't look up the specific quote from my current location but I know it's there because they were a month late revising the prospectus from last years waiver.

I also don't understand your fear of volatility. Don't get me wrong, it really is an unhappy in paradise when I'm in a fund position that is opposite the market direction but this is minimized (for me by knowledge in common patterns using a two moving average tool over a three month to 5 yr span.

On the difference in the returns, all I can tell you is I know what my starting balance was and I know what my current balance is and I made 8 trades among approx 5 funds during the month. I try to maximize which one to be in in the coming days and move accordingly. It's just like being in the TSP to me when we had the 4 IFT's but I get the bonus of more trades for no cost and I make money in down trends instead of having to park it in the G and wait for the next up trend. Well, and I can make more returns than the index.

It's not for the faint of heart but investing isn't no matter how you do it. Pick a process. Prove it workable or not. Learn it advantages and disadvantages. Create rules that work more than they don't and make a profit. I've been refining this process since 2000 and it has done me well and look forward to sharing it with anyone who has the fortitude.

Please forgive me if that got defensive. I get a lot of nay-sayer's saying you can't possibly do that and not with that company. Keep a mind open to the possibilities fellow investors.

Live long ...and prosper :)


TSPBuilder,

To clarify a few things:
1. The expense ratio with the contractual waiver is still 1.78 percent. That's insane. You can get the same performance or better long term (check 10-year returns or since inception) net of fees with Vanguard. For instance, the best performing ProFunds is Consumer Services with an expense ratio of 1.56% (contractual costs waived). Vanguard's consumer services ETF return from the same time period is 9.29 percent with an expense ratio of .10% You're essentially paying for them to risk your money and reap almost 2 percent returns on no risked capital on their part. No thanks. :) To further the point, see the calculator below.

http://www.telegraph.co.uk/investing/isas/investment-fees-calculator-how-much-will-charges-affect-your-ret/

I assumed 1,000 dollars/pounds start (currency is irrelevant for this example) with no contributions for 30 years.

Profunds - 9.86% return / 1.56% fee - 10,771 dollars/pounds
Vanguard - 9.29% return / .09% fee - 13,994 dollars/pounds

My recommendation over 30 years returned 30 percent more and all that changed drastically was the fees. Fees kill. Don't pay them.

2. I have zero problems with volatility. However, volatility + leverage = nightmare. One day, you can earn x percent and long term you can lose x percent. Over time, daily leveraged funds will eventually lose out due to contango. You have to know what you're doing. It seems you do though. :) It's math. You can't cheat it.

3. It seems you don't buy and hold but go into funds depending on the market climate so my example doesn't really matter in this case. :) I think if you have averaged 12 percent return CAGR over the past 10 years net of fees then you have your process down and you've also managed to beat 90+ percent of all professional portfolio managers in the world.

My biggest gripe is advocating a sophisticated system that utilizes leverage like yours to the average investor. Most average investors will get burned because they have no idea what they're doing. I personally use leverage at times, but sparingly. Or I'll write puts at price points I wish to buy certain stocks and collect income until the price of the stock reaches what I'm willing to pay for it.


Please forgive my tardiness in replying, skiehawk11.

I love the fact that you know how to do all these calculations and prove points. Unfortunately, your calculations are based on two pieces of erroneous information.
The first is that I was limited to the earnings potential of the fund you mentioned (instead of catching the best of several funds that exceeded the one you picked).
The second erroneous piece of information you based the calculation on was the fact that you are hung up on the fact that the expense ratio is a moot point since it is waived (you stated: "The expense ratio with the contractual waiver is still 1.78 percent. That's insane".

You really need to get over this thought process. It's costing you money. There are no fees except the IRA maintenance fee every year.

User avatar
TSPTiming
Posts: 84
Joined: Wed Oct 19, 2016 8:26 pm

Re: ProFunds 2017 YTD returns...

Post by TSPTiming »

TSPBuilder,

Skiehawk is correct about the very high expense fees for Profunds. They are being sucked out of your account every day you own the funds, but if you are doing the type of short-term trading you describe of risky funds it doesn't matter much.

Expense fees are commonly misunderstood. Here's an explanation:
https://www.thestreet.com/story/729472/ ... ssets.html

User avatar
Formula1
Posts: 2
Joined: Wed Mar 08, 2017 12:49 am

Re: ProFunds 2017 YTD returns...

Post by Formula1 »

TSPBuilder wrote:Greetings fellow investors! 2017 is off with a bang as my YTD (1/31/17) came in at 18.66%


The profund fees are not worth it. There's enough information available here and elsewhere to manage your own money as good as or even better in many cases.

Post Reply

Fund Prices2021-05-07

FundPriceDayYTD
G $16.58 0.00% 0.43%
F $20.72 0.00% -2.27%
C $63.32 0.75% 13.24%
S $82.16 1.32% 10.72%
I $38.76 1.29% 9.51%
L2065 $13.84 1.02% 11.49%
L2060 $13.84 1.02% 11.49%
L2055 $13.84 1.02% 11.49%
L2050 $28.21 0.84% 9.30%
L2045 $12.88 0.79% 8.73%
L2040 $47.05 0.73% 8.19%
L2035 $12.44 0.67% 7.54%
L2030 $41.46 0.61% 6.91%
L2025 $11.77 0.48% 5.47%
Linc $22.89 0.23% 2.76%

Pending Allocations

Under development. For now, you may view Pending Allocations by going to "fantasy TSP" and selecting "Leaderboard sort" of "Pending Allocations".

What else

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