Can someone tell me if this trade is stupid, and why more people don't do it? Say I buy 30,000 shares of TVIX @ $3.40. Roughly $90-100k. The economy keeps trucking forward and the TVIX goes down to say maybe $2. My capital has gone down to about $60,000. I can deal with the capital going down since I don't need this pool of capital for at least 2 years. But if I have the belief that a market correction is coming sometime in the future. If I just hold long enough for the TVIX to spike due to volatility in the market to say $10 or $15. I can get almost 3-4x my money with in my opinion a 33% downside risk. Basically I have to wait for something to scare the markets and then quickly sell out my shares. The TVIX is at historic lows right now and it is getting increasingly closer to 0. It has historically ranged from $10-30 in normal bull markets and spiked all the way to a couple hundred in turbulent times.
Don't do it. Trust me. Isn't it down over 80% in the past year/year and a half? They're just going to reverse-split it eventually and it'll continue to go down. If it spikes when your market value is already so far blown, even an 80% weekly gain might not get you back to par.
I was going to buy a leveraged inverse S&P ETF, but I wised up and bought SH at the bell today (which is unleveraged) and seems to track well. Trying to hedge the risk in some of my individual equities and US/International ETFs.
I'm still long crude here from avg of approx 37. I think we could easily see crude at prices north of 50 as from my initial viewpoint. Probably going to add more long on this position based on price action rest of week.
I think 42.50 area in crude could be a nice add point for you if you think we will see 50. I see us hitting 42.50 very soon. How crude reacts there will determine how I will trade it. Side note. I've been accumulating UVXY over the last 3 days. I've already moved my stops to break even. Looking to see some dumpy dumpy in the /es here soon.
Anyone watching the meltdown in the broad markets right now due to Brexit? Some of these currency reactions are once in a generation type move.
Yes, i'm watching... Check out the futures. Its going to be bad tomorrow... http://www.cnbc.com/pre-markets/
Damn. Knew I shoulda jumped on gold earlier this year but was hoping for it to get under 1000. Doesn't look like that's happening soon
Its going to be a blood bath tomorrow. If you go up 2% one day and down 2% the next you will be down overall.
Pound is wrecked. Treasuries looking for all time highs. Gold skyrocketing. Markets slammed. Don't buy the first day down.
It might get ugly tomorrow. That 230 will be erased and then probably another 200 south of that. I wouldn't be surprised to see a 500-600 point drop.
