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Trade Alert - November 5, 2006

Model Portfolio Allocation Changes- This Week

Exit the Real Estate Sector

The Performance Xtender model has triggered a sale of the remaining 10% Real Estate sector fund allocation. The sharp sell-off in REIT stocks this week was precipitated by an equally sharp move up in interest rates after new inflation concerns were triggered by a US government report on the growth in average hourly earnings.

The liquidation of this sector fund position that was initiated at the end of July will allow the Model Portfolio to lock in a gain of about 8%.

Changes in the Performance Xtender: The model is selling the previous 10% allocation in a Real Estate sector fund and redeploying the proceeds into a Large-cap stock fund. This change will increase the Large-cap stock allocation up to a fully invested 100% position.

Model Portfolio: Performance Xtender

SELL _____________ Real Estate Sector Fund

INCREASE ________ Large Cap Stock Fund

 

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Model Portfolio: Max Xtender

No Changes

 

 

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TopNew Model Portfolio Allocations

These are the new generic portfolio allocations, reflecting the changes above ...

Model Portfolio: Performance Xtender

100%        Large Cap Stock Fund

 

 

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Model Portfolio: Max Xtender

100%        Leveraged Large Cap Fund

 

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TopModel Portfolio Details

The tables below provide the percentage allocation details and mutual fund ticker symbols for investors following the Model Portfolios by using funds from either of the Rydex Investments or ProFunds mutual fund companies -- or alternatively, investors using exchange traded funds (ETFs).

'Performance Xtender'

(A model portfolio that invests selectively in stock market index funds, plus certain market sectors such as Energy, Gold and Real Estate, and in an Inverse Fund ("Bear Fund"), depending on current market trends for each type of investment. The allocation mix is designed to beat the market significantly during both bull and bear markets with only limited risk of volatility.)


Model Portfolio Changes for this week Rydex Funds ProFunds ETFs
Allocation Ticker Allocation Ticker Allocation Ticker
SELL Real Estate 10% RYHRX 7% REPIX 10% IYR
Increase LargeCaps 10% RYZAX 7% BLPIX 10% SPY
Corporate Bonds, or
Money Market
ProFunds investors should liquidate their 3% Money Market funds allocation in order to increase BLPIX to a 100% allocation.

New Model Portfolio Allocations Rydex Funds ProFunds ETFs
Allocation Ticker Allocation Ticker Allocation Ticker
LargeCap Stock Fund 100% RYZAX 100% BLPIX 100% SPY
Corporate Bonds, or
Money Market
Money Market Funds: 0%


'Max Xtender'

(A model portfolio that invests selectively in stock market index funds and in an Inverse Fund ("Bear Fund"), depending on current market trends for each type of investment. During strong market trends ... either bullish or bearish ... the model uses up to 2-to-1 leverage to magnify returns. The allocation mix is designed to beat the market substantially during both bull and bear markets but results in a relatively high risk of volatility.)


Model Portfolio Changes for this week Rydex Funds ProFunds ETFs
Allocation Ticker Allocation Ticker Allocation Ticker
No Changes - - - - - -
Corporate Bonds, or
Money Market
-

New Model Portfolio Allocations Rydex Funds ProFunds ETFs
Allocation Ticker Allocation Ticker Allocation Ticker
Lev'd LargeCaps 100% RYTNX 100% ULPIX 200% SPY
Corporate Bonds, or
Money Market
ETF Investors: Note that the SPY position should be leveraged 2 to 1.