Since the Bull & Bear Tracker’s first signal was published on April 9, 2018, the vast majority of all morning alerts have been sent out prior to the US market’s 9:30AM open. However, the timing for the sending of some of the morning alerts has changed due to the price differences or discrepancies that we discovered when the prices of the ETFs for the 9:30AM open were compared to the 10:30AM prices on August 7, 2019.
The tables below contain the price differences that we discovered when comparing the 9:30AM and 10:30AM prices for the ETFs versus the S&P 500. For both of the time slots the S&P 500 index was at 2858.60. Since all four of the ETFs are S&P 500 derivatives their price movement throughout the trading day should correlate exactly with the S&P 500. The price movement of the SPXS and the SH inversely correlate with the S&P 500.
An aggressive trader who had orders in at the market’s 9:30AM open received 1.1% less for the sale of the SPXL ETF and paid 1.0% more for the purchase of the SPXS ETF as compared to the 10:30AM prices. The total difference was 2.1%.
A conservative trader who had orders in at the market’s 9:30AM open received 0.37% less for the sale of the SPY ETF and paid 0.33% more for the purchase of the SH ETF compared to the 10:30AM prices. The total difference was 0.70%.
The price differences between the market open and post open generally occur during extremely volatile market conditions. For those signal changes that are going with the direction of the market on extremely volatile days the changes will be sent after the market opens and during the first half hour of trading. For those volatile days in which the signal changes are heading in the opposite direction the changes will be sent prior to the market open to take advantage of the discounted prices on the market open. Finally, when market volatility is low the signals will continue to be sent prior to the open when applicable.
From April 9, 2018, through August 5, 2019, the Bull & Bear Tracker’s published signals to trade the SPXL and SPXS gained 53.8% vs. 9.9% for the S&P 500. The Bull & Bear Tracker’s back tested signals to trade the SPY and SH generated cumulative gains of 75.4% from January 1, 2018 to August 5, 2019 vs. 6.2% for the S&P 500. BBT has less risk than the S&P 500, the benchmark for which the performance of all RIAs is measured. See Bull & Bear Tracker Track Record report.