All of these short ETF's are being destroyed. This market may head south at some point, but these funds may be trading in single digits by the time that this happens. Took a position with SDS today, will unload the minute that 858 on S&P is taken out, hopefully we will not reach this point. FAZ is looking dead in the water.
I think the financials are about to take a huge dump sometime soon but the problem is SKF and FAZ are going to take a beating up until that day when all hell breaks loose once again... Then FAZ and SKF will shoot way up. The problem is, how low will they be once that point comes? This is a giant crapshoot.
Im thinking of teetering back and forth in a out of FAZ and try to play it right. Once the doom and gloom hits and the financials bottom out again I'm putting the house on FAS and UYG (the anti-SKF)
Im thinking of teetering back and forth in a out of FAZ and try to play it right. Once the doom and gloom hits and the financials bottom out again I'm putting the house on FAS and UYG (the anti-SKF)
well timing isnt too bad in regular stocks... i tend to buy a position in increments and if im sold on a company i will buy it on the way down and lower my initial position average...
the problem with these triple leveraged monsters is that you're down 25% before you know it and are getting slaughtered.
the problem with these triple leveraged monsters is that you're down 25% before you know it and are getting slaughtered.
I put a stop under SRS. I am ready to take my substantial loss just to get the hell out of it.
A trader I follow on Twitter calculated that SRS would need 7 consecutive days of triple digit losses just to get back to $50. Any waver to the positive sets it back substantially. It would take an apocalyptic event for me just to break even.
He is currently shorting all 3x ETNs, which is about as low risk a play as you can get because a trend toward zero is designed in. Per the prospectus, Direxion reserves the right to do a reverse spilt at anytime the note is under $10. It's just a matter of time. I'll never buy another double or triple again. This has been a valuable, albeit costly, lessen.
I thought I understood the decay, but I really didn't.
I am with you, bought some SRS late yesterday and will be keeping on a very short leash this morning. Some pretty grim news has been rolling out this morning, like GGP (nations 2nd largest mall operator) has filed for bankruptcy. The only question is whether or not the market will respond with "bankruptcy, smankruptcy, BUY, BUY, BUY". Market seems impervious to bad news. Also, will the Fed now extend bailouts/TALF to CRE in order to keep the rally going.
