FINANCIAL BEAR 3X (FAZ)

crash 2.0 is coming...

illogical advice from acacia 09.11.12

shorting all ultrashorts, bears, or any of these terrible "leveraged" funds.

testing what's been said here on CAPs.
Do shorting all 3x ETFs mean easy net returns?
YES, IF, you rebalance once ratio goes 1.7 (or 1/1.7)

In a sideways or down market this would also translate into net points on CAPs
But your accuracy will be hurting, you'll mostly be 50% accuracy at best on this strat.
Current batch I am redthumbing here on CAPs today (at these levels):
BGU/BGZ
MWJ/MWN
TNA/TZA
FAS/FAZ

Further on my personal thoughts on this strat:
using hypothetical scenarios, actual 3x #s from '09, and 2x funds from differing periods:

Worst case scenario, this strategy loses in a year: (5%)

Best case scenarios in a year: 10%+

Should expect most returns in a year: 3-7%

In implementing this strat, pray for two things: 1) Hope your short shares don't get called back by broker & 2) if in rebalancing you wish to increase position, hope you can short more.

This strategy may be a good play to allocate comparable to the fixed income/bond allocation of portfolio or completely replace that bond allocation with this.

I would say maximum amount you sell each position is 23% of face value of account. IE a $10,000 acct, short sell a maximum $2,300 worth of each ETF.

I want to see this stock go up to $1000 again.

new bear market

Short this double wt'd leveraged short ETF and its long equivalent, FAS

Just a thought: I originally purchased this 3X financial bear at 475.80 which raised an eyebrow amongst my colleagues but closed the position on March 6/2009 with a sale at $968.00 representing my largest gain to date. Ashame I didn't short it then, but with the recent runup to 10K in the Dow and what I perceive to be more monetary headwinds in the air it seemed quite reasonable to revisit. While I don't expect anything remotely close to the run-up we witnessed in the global meltdown of the financial markets I do think a 50% plus return is not out of the question.

Ultra-shorts and Ultra-pros are all bad investments due to daily rebalancing

Bank will need a new bail out plan by a year or less!!

Free points and if you're lucky you can short these in real life Just don't over-leverage yourself in these. They're highly volatile in the short term. Trust me from experience. I sold short some of the 3x bears 3 weeks before the bottom. FAZ shot up 300% and I got a margin call twice. Luckily I had enough (just barely) to cover them and overtime profited from it. Just make sure if you do short these, that you have the surplus funds to cover if it spikes 300% to 400%

Second verse same as the first.

tmfeldrehed

bullish

Stock Market going Down

Financial sector earning

Buy low sell high. Financials are at the lowest prices ever. Time to buy low, or at least short ETFs betting against the buy low sell high philosophy!

Gwan downnnn

Get like this stock.