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Originally Posted by milmoose
1. "Double-leverage" ETFs or index funds, most likely a Rydex fund such as RYRUX or RYTNX or a Proshares ETF. These funds have double the market risk, but tend to only provide 150-180% of the market upside. Not optimal, but available with modest investment and liquid.
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Not to nit-pick, but I just wanted to point out that even in theory, holding a portfolio with a beta of 2 does not mean you will get twice the market return. It means you will get an excess return (return minus the risk-free rate) that is twice the market's excess return. Only if the risk-free rate is zero should you expect to get twice the market return. This, of course, is because you have to pay interest on the money you borrow. So even if you could borrow at the risk-free rate (assume it is 5%) and the market were to return 20%, your theoretical return would be 35%, not 40%. This would be 175% of the market return. So, actually 150-180% of the market return may be close to optimal.
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