This market is destined to be one of the worst in the history of capitalism. But as for you, and the rest of us here, my friend, there is hope…and money to be made in the IBC blogosphere.
If your long term view on the market is still bearish, you can continue to short the S&P, with peace of mind, via SH. Why not SDS, you ask? Because of ETF fuckery, oh silly one. That’s right. The double leveraged doo-dahs, like SDS, are ministers of death—for bulls and for bears. Since early this blessed year, I’ve been positioning SH as a core equity holding in all my portfolios. Because it is intended to simply be the inverse of the S&P 500 Index, you can hold it, knowing that you won’t have to suffer the egregious tracking error, as you will with it’s voluptuous double-D cousin, SDS. As you may have already learned through trial and error, SDS should be day traded or swing traded. Short term stuff, indeud. The same holds true for QID, SKF, SRS and the new kids on the block like FAZ, ERY, etc. Use them to add alpha to your account—or, not.
Due to sector rotation, there’s usually a bull market somewhere. At least that’s my mantra. Your (and my) job is to find it, exploit it, and live to tell your neighbors about it, while sipping on fine cognac.
As bad as things might seem, right now, as the market melts down, there are actually stocks advancing. (Say what?) Today I bought IAG. Yesterday it was WMT, ORC and CHE. Btw, IAG and CHE are in the PPT top 10 stocks, as highlighted by The Chart Addict. If you must be a contrarian and go long right now, you must look for stocks that are trending and showing relative strength—and that means looking at stocks or ETFs trading above their 50 and 200 day MAs, as a rule.
Behold:
ANDS, BWLD , EBS, EGO, EGY, ETQ , GMCR , GOLD , GPD , HANS , HMY , HOTT , KGC , LINC , LNCE , NFLX , OSIR , PEGA , SCO (dbl short oil), STEM (penny stock/biotech action), THRX , and ZN.
Most of these are healthcare/biotech or mining related. Other than that, not much else is drawing my interest in going long stocks.
I am still liking our greenback via UUP. …. and gold. Odd, no?
Currently, my investment model favors intermediate duration fixed income and cash over other assets, including, of course, stocks. (Can you say, “B-O-R-I-N-G” with emphasis?). Hey, sometimes you win by not losing, Buckwheat.
However, as far as stocks go, the model favors healthcare/biotech, consumer non-cyclicals and utilities over other sectors, and Latin America over all other emerging markets.
Happy trading!
P.S. Don’t forget to try out “The PPT“. For the pittance of a serf’s daily wage, you can have the privilege of tapping into a robust tool that is ripe with ideas, modeled after and distilled, from The Fly’s calculator brain—sans all that cussing. Plus, The PPT will never insult you, call you an asshat, or throw cans of corn at your nether regions. So, what’s not to like?
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