Sideways Market Strategies

How do you make money with exchange traded funds in a range bound market?

That’s the question raised by the WSJ‘s Ben Levisohn in the column Strategies for a Sideways Market.

Levisohn reports that shorting the Direxion Large Cap Bull 3x (BGU) and Large Cap Bear 3x (BGZ) ETFs would have returned $1,100 on a $10,000 investment year to date.

Another idea for making money when the trend isn’t clear? ┬áSelling covered calls.

A way to play covered calls with ETFs is the PowerShares NASDAQ-100 BuyWrite Portfolio (PQBW). The ETF normally invests at least 80% of its total assets in common stocks of the 100 companies included in the NASDAQ-100® Index and then writes call options on those stocks.

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