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I see shorting as a trading strategy that is very advanced and suitable for investors who are trader, have inside knowledge or very high risk tolerance.
Same with buying options. I don't like the time decay aspect of options--at least with stocks you can just hold onto it.
Buying stocks when they are low is always good idea. I am open to it. The problem is detecting bottoms is hard and I don't know if this "correction" will end up more like the October 2014 drop or more like 2007 drop. (My personal guess is SPY will test around ~200 and then rebound in a month.)
I own SPY right now. I will sell my entire position and short it if it closes below the 200. If it crosses above the 200 again, I will cover and buy it again.
Gold goes up in a Bear market - there are many ways to invest. You can buy defensive stocks - such as necessities like food and agriculture, auto parts companies but yea it is just easier to buy puts on retail and luxury.
gold does not always go up muh in a bear market , in fact it doesn't most of the time . you would likely do better betting on the 30 year treasury. yesterday with that 350 point drop the 30 year was up more than that drop.
in 2008 the 30 year was once again up as much as equities fell.
Gold has had trouble staying above $1200 in the past few months, there's still a disconnect there between the Shiny and the Stock Market direction.
Those Pro-shares Ultra Short ETFs might be a play (if you think this Greek Tragedy might spread). Other than that, I'm watching the SP500 movement. And keeping my powder dry.
Buying stocks when they are low is always good idea. I am open to it. The problem is detecting bottoms is hard and I don't know if this "correction" will end up more like the October 2014 drop or more like 2007 drop. (My personal guess is SPY will test around ~200 and then rebound in a month.)
I have always been a contrarian. It's my nature. Most people are conformists and like to buy securities that are going up, i.e. jumping on the bandwagon and riding the wave for all that it's worth. Trouble is that most investors jump in when the roller coaster is near the top and ready to accelerate in the opposite direction.
How can you tell when a particular market segment is near the bottom? You can't. But if stock prices of good companies are at multi year lows and yields are in the stratosphere, you can be pretty sure that a bottom is near.
Right now, limited partnership share prices in oil, gas and coal are at rock bottom and yields are incredibly high. People are bailing out for no good reason. Take advantage. Buy and hold them for a few years. See link below for current prices and payouts.
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