"Look, what you're missing is that there are some more sophisticated ways to play the bear angle than shorting and long put options. I won't spell it all out but to say you can accumulate assets that are cheap now and will be of value later when this bubble pop." This is far from sophisticated but you can stagger your way into a short position by selling SDS LEAP at-the-money puts every 100 S&P 500 points up from here. Yes, you're "averaging down", but you're staying relatively ahead of the current market because of the premium you're getting paid. Compare this with outright shorting of stock or buying puts and this is a better way to get short over a longer period of time while not exhausting your capital or time decay destroying your account. Let's just say that the market did go straight up to S&P 1500. If you did an outright short in 4 parts at equal point distances, then your cost average would be a little over 1300 with a market at 1500. But, if you sold the puts on an inverse fund, then, without doing the exact math, I'm guessing that your cost average would be more like a S&P 1400-1450 from all the premiums you took in. Now, if that number is in the ballpark, since your short a 2x inverse fund like the SDS, your 20% loss level (if all the SDS stock got assigned to you) is an S&P 500 of around 1550-1575. I don't know anything about sophistication with options or stocks. I just know that what I described above won't take you to the poor house by any stretch of the imagination.
True, interesting ideas. However keep in mind academic research has shown that the markets go down much quicker than they go up.
I liquidated the vast majority of our 401K and IRA equity funds today. No predictions, just playing it safe and paying attention to my gut feelings.
I liquidated my entire portfolio over the last two days with the exception of one position AND some put hedges i had for previous positions (just a bit). The one position i am continuing to hold is DNDN. Been dead money for a while but i know just when i sell it something will happen. Moved my retirement account into small cap value....try not to trade in and out as much with that, but figured it was time to go a bit more conservative.
I have to give it to Landis: I have never seen him wrong about the market. in fact, i am yet to read a prediction by him that is about the future.
I rolled the bulk of my assets into good ole cash today to close the books on a great year. Did +158% on the year and couldn't be happier. The only thing left to do is pick the color on a new CLS550 as part of my reward.