OK that makes sense. You are a straight shooter! The thing is I guess right now VXX could either go to low 40s, or 30. Trick is not to be upset if you don't short, and it goes to 30. This is a scary market I saw a backtested thing where VXX would have gone up 8 bagger in financial crisis. My guess is probably VXX is about done rising, but if we did go to 1800s on SnP it would come close to the 50s. Very hard to know what to do, must be cautious.
Didn't you say you lost 10% this month? How about 2014 was that better? I agree, the Snp may hit 1870, but the VIX futures need to hit 30 for UVXY to hit 60 and I think 30 would be excessive for a 6.5% drop in Snp. Are you currently long VXX or UVXY at this time?
I hope you are correct another crash would hurt this nation something fierce as we all know. Let's see what it's all about. Hard to find cheap stocks right now.
Yeah- I know everyone says this is not another crash. The problem is they all said that for the first two crashes as well. These things usually seem to come when "nobody" expects them to. If you look at the Warren Buffett ratio it says stocks are only worth about 1100 or so on S&P 500. So it doesn't seem so far fetched to me that 1100 could happen.
It sure would be an amazing drop. There is quite a list of "impressive" guys who think it is going to happen though. I don't know. If it were to drop 40% I really think this SVXY would be in single digits which is downright scary to me.
Lot of pretty well respected guys think the S&P 500 will drop another 40% from here before the low. If that happens you probably will see SVXY at 90% lower from here because the VIX would hit 70-80 and go in backwardation. Not saying it will happen, just saying these really good managers with nice track records are saying it will hit 1200 S&P 500.
I kind of do think I need to do something. I can't just sit in cash and I don't see many good values in the market. I don't see a realistic scenario where owning a big chunk of RIG at 8 (not counting the premium) in a year would be a problem. Figure by late 2016, early 2017 it should be back up there. Hoping I can get 1.25 for those puts on Tuesday.
I think this one probably goes to 0. RIG looks like a great long term buy but short term could be painful. I am selling the RIG Jan 2016 8 puts for income. The break even would be 6.75 and if RIG is there I will be OK buying unless the world has plunged into catastrophe and RIG is 0. LOL.
The 15 puts which are roughly at the money are 4.30. I assume if the stock price declines big time, the 8 puts, if they were about in the money would be about (8/15)*(4.30), or 2.35 area.
I don't have much confidence that either RIG or PGN will be higher in a year. At least I know RIG will still be in operations, PGN I believe is an exceptionally high chance it goes to 0.
If it goes to 8.01, I collect the 1.25 per share. If it goes to $30, still just 1.25 per share. A cowardly approach but it is all I have the confidence for now.
RIG does seem like a good buy. I don't have quite as much confidence as you, and am a bit of a chicken, so I am planning on Monday to sell the Jan 2016 $8 strike puts. I do not see any way those will close in the money, and the $1.25 premium is very nice.
That's awesome! I love to hear stories like this as it gives me hope. That means you've been doing 50-55% per year annualized. Truly remarkable! Everyone thinks Buffett's 21% is fantastic. Have you thought about writing a book, publishing your results?
How long did it take to make that million bucks? What were your biggest trading vehicles to do it? Not sure it is just about guts, lots of guys trade forex with 100:1 leverage and have guts- and bankruptcy!
Well, of course the rally isn't real. US stocks are incredibly overvalued and we're in the biggest bubble in history with the possible exception of 2000. However, why would the market suddenly care that stocks are overpriced?
Fed won't let the market fall anymore, what a HUGE rally today I am just surprised XIV isn't up more.
I've got some powder. What % of your overall portfolio are you putting in XIV at each level? I will eventually be close to 100% in.
This is going to be big.