• 556 days Will The ECB Continue To Hike Rates?
  • 557 days Forbes: Aramco Remains Largest Company In The Middle East
  • 558 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 958 days Could Crypto Overtake Traditional Investment?
  • 963 days Americans Still Quitting Jobs At Record Pace
  • 965 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 968 days Is The Dollar Too Strong?
  • 968 days Big Tech Disappoints Investors on Earnings Calls
  • 969 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 971 days China Is Quietly Trying To Distance Itself From Russia
  • 971 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 975 days Crypto Investors Won Big In 2021
  • 975 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 976 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 978 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 979 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 982 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 983 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 983 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 985 days Are NFTs About To Take Over Gaming?
  1. Home
  2. Markets
  3. Other

Rydex Market Timers: All In (Again!)

The Rydex market timers are all in again.

The last time I used those words was on September 25, which marked a short term high in the S&P500. About a week later, a reasonable short term (trading) opportunity developed.

Figure 1 is a daily chart of the S&P500 with the amount of assets in the Rydex Money Market Fund in the lower panel. When the money market fund is flush with cash, one can assume that the Rydex timers (like market participants in general) are fearful of market losses. From a contrarian perspective, these are good buying opportunities. When the amount of assets are low (like now), these market timers are all in; one should be on the lookout for market tops. There is little buying power left. As of Friday's close, the amount of assets in the Money Market Fund was at its lowest value since the bull run began in March, 2009.

Figure 1. S&P500 v. Rydex Money Market/ daily

The amount of assets in the Rydex Money Market Fund have been moving with in a range since early June, 2009. This range can be appreciated in figure 1. The three prior short term tops in this rally are noted by the yellow vertical lines. Coincidentally (sic), these short term tops had the Rydex market timers betting the wrong way.

Every now and then this sentiment thing works - until it doesn't. But remember, I cannot predict the next card out of the deck; I can only determine the best times to play.

 

Back to homepage

Leave a comment

Leave a comment