Business Continuity Plan for a 1987 or 911 style event

Discussion in 'Trading' started by johnpinochet, Jun 30, 2007.

  1. I don't trade the indexes often, however I'm trading the YM and the ES on occasion. Recently I've become increasingly concerned about where the general market is going and I have a question specifically directed to the folks participating here as I believe some have experience with past market crashes.

    The following is hypothetical of course:

    Assumption, today is the mother of all crashes, but it doesn't really start off like that, i.e. lulling you into a sense that it is going to be just a standard buy/sell S/R or pivots. The following is all intra-day for the crash day only.

    Let's say you were in an ES trade short during a significant down move portion of the day. Let's say you actually are able to exit the trade and be in 100% cash.

    Let's say you know both intuitively and visually from the screen and the news that something really significant and terrible is happening.

    1) Where would you put your trading money that is sitting in 100% cash right at that moment? Remember, you've already banked multiples of your normal daily profit, several times.

    2) What did gold, and the US dollar do at a time like the above?

    3) If the market closes, and you are in 100% cash in your futures trading account, can you even get your money out of your broker?

    On to another scenario. Same as above, but let's say the following is happening:

    The stock market, the bond market, the US dollar, and gold are all crashing. Yeah, far fetched, but what would you do with your 100% USD cash sitting in your brokerage account?

    OK, call me paranoid, in my line of work we have what is called a business continuity plan (BCP). This is what comes into play when a 911 event happens. That is what I want to know in a nutshell. What is your BCP?
  2. bonds, and for the past few sessions, bonds seem to be enjoying a positive bid, and yields continue to make a headway to the downside.

    if a market does crash, bonds will enjoy inflows secondary to pessimism of the future.

    so if someone is planning on pushing the sell button, a group of large funds lets say, you will see abnormal bids in the market, days leading up to it.

    the funds are basically frontrunning their own selling pressure in equities to recoupe slippage in price using another asset class.

  3. Spectre2007,

    Thanks! That was my response too, given my second scenario is almost impossible.

    Ultimately I would much prefer to have an ability to put the money into something comes to mind, but depending on where you buy your gold, you would experience a 10% hair cut via the premium you would pay for the gold. Of course there are ways around that. Everbank has a gold / silver allocated account. GoldBullion has probably the smallest premium of the online gold businesses.