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iPath S&P 500 VIX ST Futures ETN Message Board

  • wes_w_weber wes_w_weber Mar 30, 2012 11:15 AM Flag

    Best Short Product I have ever traded.

    I was long and then when I understood what this product is I was short.

    This is as close to a guarantee as you will find in the market. With its decay (contango), the complacency of markets, money printing and financial wizardry to keep the markets going this is a no brainer short.

    I'm even holding short. I will lose upon a mornings announcement of Nuclear War. That is about it.

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    • Whatever amount you are shorting just buy at the money puts each month instead. You can make thousands depending on how many you buy and in the off month something does happen like a small financial crisis you just lose the premium. Just don't spend the same amount on premium you would put into a short position because that's greedy and you could get hurt. For example I'm simply buying 5 puts and have made many thousands for a measly $600 a month out of my pocket. It's pretty crazy.

    • FAZ and VXX the same FAITH. IF you know and only know for sure 1000% the market going to DIVE out of FEAR coming. Then get out of short. Other then that long term SHORT is a WINNER no matter what due to it value lost. :)

      The only thing you may die with is a POP on it with MARGIN CALLS or brokers demand the shares to be RETURN. That is the only dangerous you have. Other then that FREE money on long term. haha

    • You still really need to be able to call the market trend. In the first half of a bull market you are better off being long beta stocks and for the last gasps of a bull and the very early stages of a bear you are better off being short beta stocks but yes, for the other 80% of the time short VXX has been the way to go.

      Free lunches don't last forever and my personal gut feeling is that the contago that has been so persistent on the front of the futures curve will gradually get arbed away over the next year or two.

      • 2 Replies to slcehamrick
      • Yes totally agree. Over the next year or 2. But contango/decay is almost at record levels, just off from 3 weeks ago. You are guaranteed to lose right now at like 20% per month!

        I went back reading that in the Google News articles the pundits that have been telling the sheeple to buy VXX at 27,25,23,21,19,17 and 16. I would have rather been short on those calls hehehe ;)

        It's so funny to go back and read those articles and sadly most beginners got drawn in.

        This thing will never hit 21 this year again let alone 25!! You think Volatility is going to spike 50%!? Wow.

        But if you are not leverage it is a better bet than going to the roulette table to bet on Red and Black. Here it is 50/50. On roulette your only 47.5% ;)

      • I'm not too familiar with contango, but I know with the leveraged ETFs like FAS, FAZ, TNA, TZA - they will go to zero over the long term by their nature. There is no way to stop that thru arbitrage or anything. I'm short VXX right now because it's dropping faster than FAZ, TZA, etc.

    • 2 out of 252 trading days last year you could have doubled your money going long at the exact right time on this product and exiting at the exact right time.

      That is a .8% chance of being right. I'd rather be the other 99.2% of the time.

      Geese guys it is fricken engineered to go to 0!! Absolute 100% chance. Just like FAZ and FAS. I wasn't able to short those products years ago. But I can short this. You can compound your gains shorting on pops as well for returns far greater than 100%.

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