What would you all say the best ETFs to short are? (Or better yet the ETFs that will not rise, say if you were short out of the money calls) I'm looking at XLF the financial ETF and XLY the consumer discretionary ETF. Although, the XLF seems a little risky to short, given the price it was trading at 1-2 yrs ago, it seems like it has more of a chance of popping if we get a bull run, but on the other hand some of those bank stocks seem like they are out of steam. Does anyone know what actually is in the XLY "consumer discretionary" Id like to know offhand? I would like some suggestions on some good ETFs to stay short, then I will tell you all my play which includes having 0% of my portfolio in equity, Long Energy stocks and commodities/commidity stocks, and short some ETFs. Last week I read a lot of articles about how commodities are relitavely cheap here and have a lot of upside potential. And into the weekend, I have been reading a lot of articles challenging the upside to this market. I really do not believe in a MELT UP, it is more likely that this rally will stall out and be stagnant for a while, or break. I will gain 50-100% on my portfolio on this one swing trade, these set-ups do not come around often, infact I haven't seen one this good in years. If you all want to make money I'll show you how, just gimme a little info on what the good shorts are. I rarely lose money on bets like these, and if I do its minimal to the reward.
Why would commodities continue to rise if the market is to fall? Quite a few of the commodities are either at the top of their channel or seem to have just broken out. They may go up, but it would be odd for there to be a divergence with the overall market.
DBC looks like its in play, Gold still is safe to be long here IMO, Crude looks like its gonna make a run, and the ags are safe to be long. If i'm going to be long 1 thing now, I think commodities are the play, everyone is all psyched about it. Dollar is getting pumled too, and instead of going long EURO i'd rather be long a basket of commodities. Trust me im not buying any sugar on all time highs, no cocoa, and no FCOJ. Maybe the ag commodities and some other shit.
Leveraged etf's are a losers game, but they never stick around for long at the same levels...think options... buy a 90 strike FAS straddle with december expiration and you're almost guaranteed to make money.
That doesn't exist. But, for comparison, a Nov straddle ATM will cost you about $20. A Jan ATM straddle is about $32. IMO, it's way to risky when your breakeven is less than 72 or more than 112 with only 1 month to go... or January, b/e less than 61 or greater than 123
200 points on the dow is more or less 10 bucks on FAS. You need 600 one way or the other to get you a 50% return on the trade - on the november options. 600 points by january breaks you even - and we just moved 600 points in the last two weeks. Your only risk is theta - vega should be good because of increased volatility during earnings. Not the best trade for sure - but it's really not that risky and the reward can be high - and you have 2 months for the trade to work out before it starts really taking a hit - if you go with the january one. Also - max drawdown by dec 18 is $1400.00 based on 1 contract.
I've been selling SPYs and QQQQs lately, some XLF. I'm leaning more towards shorting indivual stocks like WFC, JPM, BAC, and IBM mostly. Most of my plays did not get executed because of missed fills, market is just too strong, and there is no way i'm payin up to get long up here. Fuuuuuhhh dat.