DMM is an ETF based on the S&P/Case-Shiller Composite-10 Home Price Index. This index tracks housing in Boston, Chicago, Denver, Las Vegas, Los Angeles, Miami, New York, San Diego, San Francisco, and Washington D.C.
DMM is a negative bet on the index. DMM’s sister index UMM is a long bet on the index.
The index is very thinly traded and patience must be used when establishing a position. There are days when the spread is a wide and there are days when the spread is only a few pennies. The index has gone from $22 to $25 over the last 30-45 days and is one of the few bearish bets that has been working lately.
If you believe that housing has another leg lower, and that this summer was simply a consolidation in price, it is worth a look off the 20-day SMA. It has been trading above this level for the past 30 days. $25.50 is also horizontal and fib support although it is hard to give the technicals a lot of weight since this only started trading in June.
I currently don’t have a position, but I do find it handy as an additional indicator to keep on my radar screen when I’m making observations about the bigger picture.
-
zstock, Pro Select!
-
chartsandcoffee
