Skip to main content
No. of Recommendations: 1
I have finally, after a long struggle and many failures to do what I say, *finally* begun making money in a down market. First I stopped buying and holding. Now I'm through with simply getting out and going all cash. It's just too dang easy to profit off of a falling market these days. Inverse ETF's and put options are as close as a click of the mouse. It is ridiculously easy to get approved for option spreads.

Me, I'm through with wringing my hands while my nest egg shrivels to nothing. What about you? If the trend is down will you still make money or will you sit paralyzed on the sidelines? Will you sit on your cash while waiting and waiting and waiting for the bottom while listening to the talking heads discuss capitulation?

Will you continue to fight the trend, or will you follow it?
Print the post Back To Top
No. of Recommendations: 0
CAPITULATUION!

Lets see if I can get the preffered deal that the big investors are getting in Barclays.

If not, I may add PFE, SYY or BCS common. (Still sniffing around GOM, but waiting, they go up slower than the go down.)

Cheers
Qazulight
Print the post Back To Top
No. of Recommendations: 0
Just don't follow the trend too closely or you won't be able to see what's going on ahead. You're using leveraged tools to chase limited gains during a time in which it's very vogue to do so. If doing this on the way up makes for a bubble, then doing it on the way down might make for a vacuum. At some point you're not going to be able to rarify the air anymore and then things will implode.

Warren Buffett likened this scenario to Cinderella at the ball and it applies to both short and long positions. You're at the ball and you're having a good time. You plan to leave at 11:59, just before your carriage turns into a pumpkin. The only problem is that there are no clocks in the building and everyone else is also planning to leave just before midnight.
Print the post Back To Top
No. of Recommendations: 0
Just don't follow the trend too closely or you won't be able to see what's going on ahead.

Risk and money management rules apply, of course.

You're using leveraged tools to chase limited gains during a time in which it's very vogue to do so. If doing this on the way up makes for a bubble, then doing it on the way down might make for a vacuum. At some point you're not going to be able to rarify the air anymore and then things will implode.

I am all in favor of using any tool, leveraged or not. But I don't see how leverage equates to 'limited' gains. Limited compared to what? Stock ownership? I also do not understand the 'vogue' comment. Yes, some of these instruments are more popular now than a few years ago, but in reading this message board or watching any financial network you would think that there was no such thing as shorting the market. It doesn't seem to be too much in vogue to me.
Print the post Back To Top
No. of Recommendations: 0
It's not leverage that limits your gains but the fact that you're short. There is a barrier beyond which you cannot progress on the downside: 0. In the real world, the barrier is actually far above that because at some point it will be unappealing (in aggregate) to attempt to squeeze diminishing returns at greater risk out of assets that are too small to absorb the deployment of a growing pool of money.

The easy shorts have been played. You're in risky territory now. I'm not saying do this or don't do that. I'm just saying keep an eye out and don't tell your friends you're a genius until you lock in your gains.
Print the post Back To Top
No. of Recommendations: 0
It's not leverage that limits your gains but the fact that you're short. There is a barrier beyond which you cannot progress on the downside: 0.

Unless your timeframe is infinity and the market never ever drops again, then going long has its limits as well.

The easy shorts have been played. You're in risky territory now. I'm not saying do this or don't do that. I'm just saying keep an eye out and don't tell your friends you're a genius until you lock in your gains.

About six weeks ago I was sure the bottom was here and went long. It didn't seem so risky. The bull call credit spread I just did for a quick 10% was much less risky, mainly because I am no longer married to a direction. I think it's much *less* risky that way...
Print the post Back To Top