That is why I always wait for it to peak and then short because then I don't have to concern myself about this kind of #$%$.
I hope you are right. But all too often a green day follows a red day as bargain hunters ignore the warning signs and buy back in too early. That would be called the proverbial dead cat bounce. However once the cat falls back down on the porch with a nice loud thunk we might hope to see multiple down days in a row. Cross your fingers. Don't loose heart if we get a green day tomorrow.
I'm watering at the mouth. I would say we have an excellent short event coming down the pike. I'm getting ready to pull the trigger. I stuck my toe in the water earlier today. If we get another 15% increase I will nibble on some more. Shorting that is.
It looks like to me that the market talked its self into a correction. They certainly have been trying hard enough. It looks like they may have succeeded. I'll be disappointed if this fizzles. A 20% decline in the market would be perfect to knock off some of the froth and to teach some of the newbie’s the danger in thinking too optimistically about their expectations.
The fact is that we don't know anything about what the stock market is going to do in the near future. All we can do have our suspicions. Anyone who thinks differently thinks too highly of themselves.
All we can know for sure is that if the VIX goes up that it will eventually come back down and that TVIX's price erodes daily so even if the VIX goes up and levels off for a while then TVIX will not remain level but will start going down from there. These truisms don't have anything to do with market conditions and given enough time they always come true which basically says that time is on the side of the short.
Here is my logic. The VIX may go higher if this is a larger market correction. But then this could be another fake out so I wanted to get at least something short so I would have some skin in the game. If this is the start of a greater correction and the VIX goes higher I will short some more. I fully expect my profits on this early position to not be that wonderful. But I wanted a lower entry just in case this is all the higher it goes. At least then I will be making something be it a modest amount, but it will give me some pocket change at least.
I was stopped out and I'm waiting for my new short entry point. We both want the same thing. We both want TVIX to peak. I just ride down the obvious decline whereas you try to ride up the elusive peak, that is, if you can time it before you lose most of your stake which is a problem I do not have to worry about because I do not hold a position that is eroding.
Even now you cannot know for sure if this is the start of a new major VIX peak as it might fizzle. I am hoping that it is the start of a new major VIX peak but I don't have to worry if I am wrong because I am not holding a position that is decaying with time. So I can wait until I am right for sure at no risk to myself. When it peaks I will short. The price will go down as it always does and its price will continue to erode which is also good, that is, if you are short.
I am a little disappointed that TVIX has not gone up very much considering that the VIX is at 15.5 already. The VIX goes up 16% and TVIX is up 12.5%? What happened to the 2X?
I was absent because I was out on bereavement and then I went on a scheduled vacation. It doesn’t seem like I miss much though. I dumped everything at the end of last week when I concluded that I was making nothing for being in the market so I decided that it was not worth the risk exposure. And with all the correction talk I am concerned that people are talking themselves into as self fulfilled prophecy. These things and build on them selves. Also the market out flows are not that encouraging.
I play the dark side of TVIX.
Here is the problem. TVIX's underlying is a futures contract so its value decays with time as all futures contracts do. Thus one needs to be on the side where that decay is to your advantage. So to do that you wait for the market correction and then you short TVIX at its peak because your timing can be nearly spot on. However the long has to play a guessing game where they buy before the correction hoping that they are right about market conditions. Whereas if you buy after the correction you know that you are right because you are there at the peak or close to it, depending on how you average into your position.
You can make the same amount of money on the way down as on the way up however it is a lot easier to observe the peak before the decline because it always occurs right after the VIX spikes. The stock always comes back down and then continues to erode which is only icing on the cake.
For the most part the only people making money consistently on TVIX are the shorts. Whereas most of the longs eventually complain that the SEC should delist TVIX. Hang around here long enough and you will see. Only the shorts stick around. The longs all disappear never to be heard from again.
You don't understand how a tracking ETN works. All the shorts could cover in one hour and it would not impact the price by a penny.
Besides, if the shorts were using stop losses like I was they are already out. What we want now is for the market to correct and for the TVIX stock price to rocket up so that we can refresh our short positions.
Currently I am 90% cash and hoping for a 20% market correction.
I would not buy this stock long as it is too risky. But I will wait for it to go up and then short it which is safer.
I am aware that institutional investors are pulling money out of the market. That would be hedge funds and pension funds and the like. But I was unaware that someone was holding up a sign saying "I'm big money and I'm pumping so I can dump." I think you imagination is filling in the gaps.
Retail investors on the other hand are still adding money to the market. I am assuming that much of this has to do with the fact that 401K account money keeps trickling in.
I for one have decided to take a breather. I would feel much better if we had a nice 20% correction after which I could come back in and feel a bit safer about valuations.
Also much of the concern about over valuations is focused on these over priced high fliers that we all know are over priced. No experienced investor is going to buy these stocks knowing that they will get hit very hard in any correction. Of course you have newbies with little experience who will imagine that "this time is different" and need to be taught that things are never different. Lucky for us or how can us more experienced investors make money?
In any event, I'm out for now.
I cannot find anything that confirms this. I hope they don't delist it. It is a wonderful way to make money if you short it.
it does not show up as a menu selection on the summary page but you can get there by typing in UVXY into the "get message board for" field on any message board page.
I did that. I sold most everything. I am now about 80% cash. The issues I was concerned with that lead to this probably do not affect AGNC. AGNC is its own beast dependent on future interest rates only. The economy could be crashing and if interest rates are going to go down then it will go up.
That said, I would not base my investment strategy on interest rates going up. Fed policy has gotten very political under Obama. You would be investing based on political outcomes. That is not something I want to try and predict.
In case you have not noticed. All that this turmoil did was keep TVIX from declining at its normal rate. It has not gone up. It only stopped losing money. I get it that for many that this is great news. But seriously, if this is the good news then what is the attraction?
I have been saying exactly that for 6 months and most longs don't understand that until they actually experience it. It was obvious to me the second I looked at the chart. But.the people who buy this stock seem to miss this. I think it can be concluded that if you would buy this stock in the first place it says something about you ability to understand the things that seem immediately obvious to the shorts. For some reason they over look the obvious and just see those occasional large spikes and image that another one will happen soon not comprehending that it is impossible to predict.