How to profit from a European meltdown

Discussion in 'Trading' started by Smurfie, May 12, 2010.

  1. Smurfie


    Hi guys

    So, I know next to nothing about economics and the interrelatedness of financial instruments and such. However, I do believe that at some point you have to stop pouring billions of Euros into the bottomless hole that is Greece. I also believe Italy may be in even worse shape, but no one seems to care just yet. There are other problems of course and so on and so forth.

    If the whole Ponzi scheme that seems to be European economics these days should tumble, how do you profit from it? What advise would you offer an economically challenged person like me?

    The Euro will suffer I suppose as it already has. Rates should go up in the involved countries but will it spread to the rest of Europe and/or the world? Short the stock indices, bonds ... what?

    I apologise in advance if this question has been done to death. I was just inspired by the graphics in New York Times that a Danish paper re-printed today.


  2. Short Euro, short pound.
  3. Buy EUO.
  4. LeeD


    You already missed all the action last week but chances are there is more to come. Also buy gold.
  5. Banks are probably ripe for another hit - sorry "National Bank of Greece"

    This can go to ZERO.
  6. subban


    These ultra short etfs are they good to hold long term(6-12 months)? I thought it is more for daytraders since the index resets every day and it does'nt proportionetly go up much in the long run compared to the index its tracking. Also the number shares turned over every day in these is unbeliveable. Almost 2-3 times volume the actual # of outstanding shares.
  7. Against what? US $ ? As if the US is in a whole lot better position!

    Short Euro / Long a commodity currency like Aus/Can $ or Norway Kr, would probably be better.
  8. blcdoc


    Buy low delta puts on the Eurostoxx50 Index (SX5E) and let them run. Sell them out after the panic/market fall (as oposed to running them to expiry).

    I am a market maker of options on this. Huge volumes of underlying and the options. Very liquid market. And it is very sensitive to any of the sovereign issues in the Eurozone.

    Now is probably a good entry point before things kick off again (which I am sure they will in the coming weeks)...

    Good luck.
  9. Buy EPV.