Posts: 1,024
Threads: 8
Joined: Aug 2018
Reputation:
16
(03-24-2020, 11:08 AM)fenders53 Wrote: (03-24-2020, 10:52 AM)stockguru Wrote: (03-20-2020, 03:01 PM)Otter Wrote: So, on a day when SPY finished down 4.3% on above-average volume, SVXY was up 1.5%. That IV Crush is no joke, LOL.
What about buying SDS?? I was thinking of getting this one today. If the market is headed down another 3-4 weeks this one would be good to be in. Maybe a good time to buy today with the market green lol
Maybe you already know this but it's 2X leveraged and they are using options, so there is time value decay. You need the market to move down significantly and soon. If you try to hold it a month and the market goes sideways or loses volatility, you won't be even. Pull up a ten year chart and you'll get the picture. Most leveraged ETFs eventually go to zero and are liquidated. All that said the market is highly likely to dip in the next few weeks so now would be the time to try it.
100% true. This is all predicated on some big SPY drops happening in the next few weeks, substantially below current levels.
That said, I believe that to be a likely scenario. This is, of course, a high-risk trade (hence discussion in this thread).
Posts: 6,404
Threads: 47
Joined: Aug 2018
Reputation:
68
(03-24-2020, 11:24 AM)Otter Wrote: (03-24-2020, 11:08 AM)fenders53 Wrote: (03-24-2020, 10:52 AM)stockguru Wrote: (03-20-2020, 03:01 PM)Otter Wrote: So, on a day when SPY finished down 4.3% on above-average volume, SVXY was up 1.5%. That IV Crush is no joke, LOL.
What about buying SDS?? I was thinking of getting this one today. If the market is headed down another 3-4 weeks this one would be good to be in. Maybe a good time to buy today with the market green lol
Maybe you already know this but it's 2X leveraged and they are using options, so there is time value decay. You need the market to move down significantly and soon. If you try to hold it a month and the market goes sideways or loses volatility, you won't be even. Pull up a ten year chart and you'll get the picture. Most leveraged ETFs eventually go to zero and are liquidated. All that said the market is highly likely to dip in the next few weeks so now would be the time to try it.
100% true. This is all predicated on some big SPY drops happening in the next few weeks, substantially below current levels.
That said, I believe that to be a likely scenario. This is, of course, a high-risk trade (hence discussion in this thread).
That was for guru. I know you understand the effect of time and volatility on options.
Posts: 1,024
Threads: 8
Joined: Aug 2018
Reputation:
16
(03-24-2020, 11:28 AM)fenders53 Wrote: (03-24-2020, 11:24 AM)Otter Wrote: (03-24-2020, 11:08 AM)fenders53 Wrote: (03-24-2020, 10:52 AM)stockguru Wrote: (03-20-2020, 03:01 PM)Otter Wrote: So, on a day when SPY finished down 4.3% on above-average volume, SVXY was up 1.5%. That IV Crush is no joke, LOL.
What about buying SDS?? I was thinking of getting this one today. If the market is headed down another 3-4 weeks this one would be good to be in. Maybe a good time to buy today with the market green lol
Maybe you already know this but it's 2X leveraged and they are using options, so there is time value decay. You need the market to move down significantly and soon. If you try to hold it a month and the market goes sideways or loses volatility, you won't be even. Pull up a ten year chart and you'll get the picture. Most leveraged ETFs eventually go to zero and are liquidated. All that said the market is highly likely to dip in the next few weeks so now would be the time to try it.
100% true. This is all predicated on some big SPY drops happening in the next few weeks, substantially below current levels.
That said, I believe that to be a likely scenario. This is, of course, a high-risk trade (hence discussion in this thread).
That was for guru. I know you understand the effect of time and volatility on options.
Absolutely, and it is good info for everyone. Contango is not your friend (as anyone who played with UVXY for most of the past decade discovered).
On the flipside of this, once a clear bottom appears to be in (to me, it still looks like we are in the volatile price discovery period of a market phase transition, based upon the continued up/down choppy swings), SVXY as a long term speculative hold seems like a winner. Put the long-term trend of the market over time (up) to work on a leveraged basis.
Posts: 1,145
Threads: 2
Joined: Jul 2018
Reputation:
1
03-24-2020, 11:36 AM
(This post was last modified: 03-24-2020, 11:37 AM by vbin.)
You guys might wanna go through this thread. Good to have different prospectives.
https://us.teamblind.com/s/VOjed7r0
If you guys don't have the app, they have a website aswell. Just Google ask me about the crash blind
Posts: 1,024
Threads: 8
Joined: Aug 2018
Reputation:
16
(03-24-2020, 11:36 AM)vbin Wrote: You guys might wanna go through this thread. Good to have different prospectives.
https://us.teamblind.com/s/VOjed7r0
If you guys don't have the app, they have a website aswell. Just Google ask me about the crash blind
Yup. Bear markets always have the biggest rallies.
Posts: 1,145
Threads: 2
Joined: Jul 2018
Reputation:
1
(03-24-2020, 11:41 AM)Otter Wrote: (03-24-2020, 11:36 AM)vbin Wrote: You guys might wanna go through this thread. Good to have different prospectives.
https://us.teamblind.com/s/VOjed7r0
If you guys don't have the app, they have a website aswell. Just Google ask me about the crash blind
Yup. Bear markets always have the biggest rallies.
This guy is also predicting great recession based on Elliot curve and debt bubble but I do not agree with that theory.
Posts: 6,404
Threads: 47
Joined: Aug 2018
Reputation:
68
For sure, bear markets are good for trading as long as you don't stay out of the market too long as you'll get burned when you miss just a few good days when it turns. I saw some charts on SA yesterday. If you miss the best ten days of each decade since 1930, you lose a ridiculous amount of return each decade. Only ten days in a decade. I've known that to be true but seeing it graphically made a strong point.
Otter,
I definitely plan to leverage to the upside. I'll have to reach deep so I don't jump in too soon. I sleep just fine paying too much for long shares I intend to keep for 10+ years. Not so much with options. 
Posts: 1,024
Threads: 8
Joined: Aug 2018
Reputation:
16
(03-24-2020, 11:47 AM)vbin Wrote: (03-24-2020, 11:41 AM)Otter Wrote: (03-24-2020, 11:36 AM)vbin Wrote: You guys might wanna go through this thread. Good to have different prospectives.
https://us.teamblind.com/s/VOjed7r0
If you guys don't have the app, they have a website aswell. Just Google ask me about the crash blind
Yup. Bear markets always have the biggest rallies.
This guy is also predicting great recession based on Elliot curve and debt bubble but I do not agree with that theory.
Yeah. I don't have a crystal ball for typical economic/business cycles. My entire side-bet short thesis since early February has been tied to anticipated impacts of the virus, based upon epidemiological modeling.
I still think the most severe impacts (peak of the peak) are around the end of April, beginning of May timeframe. My best guess is that the downward market pressure will largely follow the virus for that period.
I have absolutely no idea what happens with the markets after the peak recedes. Do we skid along sideways for a while? Maybe. Do we drift lower for a few months until reaching a March 2009 nadir, as compounding negative economic data drifts in? Maybe. Do we start to rise slowly? Maybe. Is there a rapid run-up relief rally? Maybe.
With all this speculative stuff, I'm keeping my timing tied to the anticipated peak. I anticipate going long on a lot of stuff in 4-5 weeks.
I could also be wrong. Perhaps everything is already priced in and we've seen the bottom already.
Posts: 6,404
Threads: 47
Joined: Aug 2018
Reputation:
68
03-24-2020, 12:33 PM
(This post was last modified: 03-24-2020, 12:34 PM by fenders53.)
(03-24-2020, 12:16 PM)Otter Wrote: (03-24-2020, 11:47 AM)vbin Wrote: (03-24-2020, 11:41 AM)Otter Wrote: (03-24-2020, 11:36 AM)vbin Wrote: You guys might wanna go through this thread. Good to have different prospectives.
https://us.teamblind.com/s/VOjed7r0
If you guys don't have the app, they have a website aswell. Just Google ask me about the crash blind
Yup. Bear markets always have the biggest rallies.
This guy is also predicting great recession based on Elliot curve and debt bubble but I do not agree with that theory.
Yeah. I don't have a crystal ball for typical economic/business cycles. My entire side-bet short thesis since early February has been tied to anticipated impacts of the virus, based upon epidemiological modeling.
I still think the most severe impacts (peak of the peak) are around the end of April, beginning of May timeframe. My best guess is that the downward market pressure will largely follow the virus for that period.
I have absolutely no idea what happens with the markets after the peak recedes. Do we skid along sideways for a while? Maybe. Do we drift lower for a few months until reaching a March 2009 nadir, as compounding negative economic data drifts in? Maybe. Do we start to rise slowly? Maybe. Is there a rapid run-up relief rally? Maybe.
With all this speculative stuff, I'm keeping my timing tied to the anticipated peak. I anticipate going long on a lot of stuff in 4-5 weeks.
I could also be wrong. Perhaps everything is already priced in and we've seen the bottom already.
Otter, this is a good time to study past corrections, then apply what is different this time, because it's never the same. I'm sure you've thought of all this, but this is what I find most relevant.
-We've never shut our economy down this long (projecting), and that includes fighting world wars. There is going to be a recession. This isn't late 2018.
-the FED has never juiced the economy like this. There is an election approaching. There could be several more stimulus bills. We've lost our damn minds when it comes to printing money we don't have.
.
-This is in the top two fastest market drops all-time. Perhaps we took a shortcut to the bottom and it won't require years as it has at times in the past.
-Some things remain the same. The average investor is likely to be shell-shocked. Many will never return to the market. Those who remain will condition themselves to ignore horrible earnings reports while dreaming of a better next qtr/yr.
My thesis is it is EXTREMELY likely there will be an upside rally, and it could be amazing. It also may be short lived, but it will be a tradeable event. Our near-term bottom will very likely be prior to the virus climax. The market tends to find a way to make that happen. You wait for blue skies, you probably miss the bus like the last ten times.
Posts: 1,024
Threads: 8
Joined: Aug 2018
Reputation:
16
Bought some SQQQ and 9/18/20 UAL 35 Puts today on the speculative/high risk side.
Posts: 1,024
Threads: 8
Joined: Aug 2018
Reputation:
16
Obviously, neither are intended as long term holds. Just stuff to trade on the next big downward drop.
Posts: 6,404
Threads: 47
Joined: Aug 2018
Reputation:
68
(03-26-2020, 09:47 AM)Otter Wrote: Bought some SQQQ and 9/18/20 UAL 35 Puts today on the speculative/high risk side.
Airlines will be interesting. They probably have unlimited GOV support but their finances are a mess. I lightened up on my DAL long position on the nice spike. Selling covered calls on the remaining shares.
|
