Am trying to learn more about the stock market and how the big guys make money – question du jour is how do you make money when interest rates rise – which seems likely and imminent. The assumption I have is that when interest rates rise, stocks get hammered.

Well starting at me from home was the cover of Fortune magazine, which has an article (sorry, have to register) explaining that things are not as simple as I thought, and giving tips on what to invest in. They mentioned GE and implied that big, diversified companies should still do well…

Another somewhat related discovery is the mysterious Rydex Tempest 500 H mutual fund. If you look at a chart that compares it with the S&P 500 you’ll see that it moves in opposite directions to any given S&P500 movement. Well guess what? RYTPX shorts every stock in the S&P so if you want to bet on a stock market decline, this seems like a good bet.

Of related interest, though off topic now, is RYCTX which attempts to double the S&P returns.