1. Time and Money By Ken Hodor
Optimizing ROI
Time and Money
By Ken Hodor
5/23/2007
QID/QLD by KMH

2. Investment Objectives
Safety
Highest possible return
Liquidity—I want my money now!
Minimal time commitment
Simple
Automate as much as possible
5/23/2007
QID/QLD by KMH

3. Evolution Bank returns 4% CD returns 6% Own your own home 8% or less
Buy investment property
depending on where –100 to 100% per year
Below here meets my objectives
Buy and hold quality stocks 8%
Options 100% in one day! WOW
Trade QID and QLD 0.5% per day
5/23/2007
QID/QLD by KMH

4. Chasing Beta S&P 500 Beta = 1 Good stocks Beta approaches 2
HPQ = 1.9
HON = 1.63
GS = 1.16
CSCO = 1.71
QLD / QID Beta is 2 and –2 respectively
5/23/2007
QID/QLD by KMH

5. QQQQ Diversification 100 top NASDAQ stocks (such as top 10)
AAPL Computer
CMCSA Consumer TV network
MSFT Software
GOOG Marketing
AMGN Medical
CSCO Networking
SBUX Coffee
QCOM Semiconductor phone ICs
INTC Semiconductors
ORCL Database software
5/23/2007
QID/QLD by KMH

6. Change per day Long term
QQQQ = 0.29% / day
QLD = 0.58% / day
QID = -0.58% / day
Rule of 72:
Double in 124 days
5/23/2007
QID/QLD by KMH

7. Green Arrow Buy
5/23/2007
QID/QLD by KMH

8. Green Arrow Buy (calls)
5/23/2007
QID/QLD by KMH

9. Style Minimal trades—big market moves
Last year 60% return
Update daily to catch corrections
Last year potentially >60% return
Day Trade
>0.5% per day
5/23/2007
QID/QLD by KMH

10. Style #1 Follow the arrows
3 green arrows on QQQQ
Buy QLD
Sell QID
3 red arrows on QQQQ
Buy QID
Sell QLD
5/23/2007
QID/QLD by KMH

11. Style #1: Minimal Trades
3-Green Arrows Buy QLD
Sell QID
3-Red Arrows
Sell QLD
Buy QID
5/23/2007
QID/QLD by KMH

12. Can you avoid big negatives?
Channels
Candles
Feb 27, 2007
5/23/2007
QID/QLD by KMH

13. Style #2: Catch Corrections
Stick with trend—either QID/QLD
Too hard to flip between the two.
To Buy
Every day adjust “stop buy”
previous day high
To Sell
Every day adjust “stop loss”
previous day low
5/23/2007
QID/QLD by KMH

14. Style #3: Day Trading Drive you Crazy
Plots with 3 minute intervals
EMA 20
EMA 60
Like looking into hand of market makers
5/23/2007
QID/QLD by KMH

15. Style #3: Day Trading (plot)
5/23/2007
QID/QLD by KMH

16. Style #3: Day Trading Depends on market conditions
EMA 20 crosses EMA 60
Candles touch EMA 20
Watch for peaks and valleys—hesitations
Goal 1% per day
Tighten stops– $0.05 on QQQQ trigger QLD/QID
Cash out and wait for confirmed movement
Momentum + distance ($0.05) from EMA 20 to buy
Use very tight stops from here on to follow trend
5/23/2007
QID/QLD by KMH

17. Risks QID/QLD move fast QID can go to $0 Emotional roller coaster
Set up automatic triggers
Trailing stops
Stop losses
Stop buys
QID can go to $0
When only 50 stock holders trading
5/23/2007
QID/QLD by KMH

18. Tax ramifications If qualify as IRS 1256 contracts then:
60% profit is long term capital gains
40% profit is short term capital gains
NOTE: at this time DO NOT BELIEVE TRUE…still checking.
5/23/2007
QID/QLD by KMH

19. So What Happened? Since Last Meeting
5/ year Treasury start creeping up
10-year Treasury >5%
5/23/2007
QID/QLD by KMH

20. Trader’s Saying Sell in May and go away It worked for me ! 5/23/2007
QID/QLD by KMH

21. Conclusion Make it as simple as you can, but no simpler. Einstein
Trade 2 stocks QID and QLD
5/23/2007
QID/QLD by KMH