XLF Short

Discussion in 'Trading' started by Comptalk, Aug 9, 2007.

  1. Anyone think it is too late to short the XLF?
  2. Id just like add here that that morning arca guy who displayed 500k on the offer destoryed me... Stupid dick, now hes getting his ass kicked, but still F!
  3. not too late to short XLF, plenty of bad news with the banks and brokers coming up in the weeks ahead. Not too late to short XHB either
  4. Szeven, XLF is an ETF. One person showing big size is not going to change the behavior of the XLF especially with the amount of volume it gets. XLF tracks an index of stocks and doesn't trade like a stock itself. It has plenty enough liquidity to absorb any big offers/bids without affecting its tracking of its stocks.
  5. I've been keeping an eye on it the last few weeks. It looks like most of the damage has already been priced in. The million dollar question is whether there are unidientified problems in the financial sector that will have a more pervasive impact on the economy.

    This may be more medium-term play for me. While it looks like it has some more room to fall, I feel it will ultimately bounce back. I may end up selling a few puts at a lower strike
  6. una11


    I tend to agree. While I think a top *may* be starting to form, I don't think we just continue straight down from here - WAY too many bears (CPC, VIX, odd lot shorts, etc.). Retail is also fleeing mutual funds and is scared to death the bear is back. We shall see.
  7. Were you trading it this morning? This thing opens, and someone steps down 500k on arca for 10+ cents while the futs are tanking and the trend premkt is straight down. My time frame is short and i made a bad decision on the exit thats for sure. For me, holding a loss for 4 minutes is abnormal.
  8. Daal


    I refuse to short this without a good exit strategy, which so far I havent came up with
  9. una11


    Agree. XLF is a crowded short and subject to massive whipsaw.
  10. Buy some deep in the money puts on a bounce towards the Moving Averages. Then, when it gets killed again and feels deeply oversold buy common stock to "hedge" the puts. When it moves back to the MAs, sell the common at a profit and keep the puts.

    Another good ETF to watch is RKH (regional banks) which have significant housing loan exposure.
    #10     Aug 9, 2007