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goldminingXpert (29.49)

Sell All Ultrashorts now!

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October 10, 2008 – Comments (10)

Many of them will lose half their value in the next couple of weeks. Particularly hard-hit will be TWM and DUG. DUG is short oil stocks. Exxon has dropped 25% in the past two days--XOM is more fiscally sound than the US Government, Exxon will be back. Get out of the ultrashorts. Now! Going long is dicey, I am, but only in small bits via calls where I don't mind losing 100% of my position.

10 Comments – Post Your Own

#1) On October 10, 2008 at 3:10 PM, DemonDoug (82.85) wrote:

I just red thumbed DUG in CAPS - I'm now beyond long on oil in caps (still just holding 23 shares in suncor as my main oil play in real life).  I got out of SKF because I'm worried that the counterparties won't be able to satisfy obligations.

Good call.  Now if oil would just go back up again dammit. :P

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#2) On October 10, 2008 at 4:25 PM, russiangambit (29.30) wrote:

Looking at how oil stocks are being treated, one should expect free gaz any time now. LOL.

My choices were NOV, RIG and OXY, all down 10-20% each day for the last 5 days.

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#3) On October 10, 2008 at 4:27 PM, nuf2bdangrus (< 20) wrote:

I did not hedge because I continued to be afraid od a massive federal move against me, starting with the bailout.  Seems foolish to short after a 700 pt drop.  I didn't sell anything either, and indeed, bought a little bit more.  There's now way I would buy an ultrashort once they went parabolic.  I'm long a little UYG.  Missed MVV.  SHould go long TBT and wait for gold to dip before buying more.  Technically, gold is making lower highs at each panic, despite the shortate of physical

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#4) On October 10, 2008 at 4:43 PM, leohaas (32.86) wrote:

I am not so sure about this. Just read this article about the unwinding of LEH's credit default swaps. It means that hedge funds will sell everything they can sell. That is the next leg down in all markets!

I am well-setup to take advantage if the market does come back, but I am hanging on to my SPY puts and SKF calls even though they are in the money...

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#5) On October 10, 2008 at 4:53 PM, goldminingXpert (29.50) wrote:

there will be another leg down Leohass, but not now. As you can see from the fill prices on CAPS of my ultrashort red-thumb bets, I called this turnaround this afternoon, this should continue at least until OPEX, maybe longer. The next leg down AFTER that will take your breath away. But if you have in the money calls on SKF and then it drops to 125, you are going to be really bummed.

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#6) On October 11, 2008 at 1:41 AM, jester112358 (28.77) wrote:

The next leg down may be Oct 23 when the WM CDS auction is held.  It looks like the insurers of the LEH CDS bonds are out 90 cents on the dollar on around 600b$ of bond defaults according to naked capitalism.  Whoever is the on the insuring end (AIG, a bunch of banks and other insurance companies) is really insolvent now.  I just don't see a major rally until some transparency to the CDSs market is achieved-and the unregulated nature of these contracts makes that impossible.  There's just too much uncertainty in both banks and insurers to drop short hedges in this area.

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#7) On October 16, 2008 at 10:22 AM, MLGtrader (98.60) wrote:

FB says that builders are going lower, and builders always move with the market.  I think we will see some more pain in the markets before we turn around.  I do think that commodities have been hit too hard though.  They are the only sector that is making decent profits and that are completely independent of the financial crisis.

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#8) On October 17, 2008 at 12:43 AM, mgiv (99.19) wrote:

i'm with you.  I'm not looking for an exact bottom.  That call is as close to free points as it's gonna get.  short and reshort. short and reshort.  We've dropped about 40% and there are alot of good companies that don't deserve it.  We got commiment that the world will do whatever it takes to prevent this catastrophe.  Plus some additional bank regulation should do some good.  Fluffy greenbacks and purple euros will be printed freely.  Thus the bull in commodities is still intact.  Alittle bit of debasement should be good to balance the global equality of life.

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#9) On October 19, 2008 at 10:29 PM, MLGtrader (98.60) wrote:

Hey GMX,

Would now be a good time to load up on JAG?  What did you think of their latest earnings?  They still on pace for ownage?

thanks,

 Collin

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#10) On October 31, 2008 at 10:26 PM, motleyanimal (90.02) wrote:

The dollar bubble will burst, as all bubbles do.

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