Shorting S&P 500

#1

Hi Guys,

Looking at how things are developing now in the markets with:
main markets falling, US bonds falling, Crypto falling quite synchronized I’m starting to think on taking a position to short the S&P or NASDAQ.

I don’t want to be extremist but this bull market seems to be getting to the end…
I know… never time the market and ride the wave for the long term but… This could be an oportunity to jump on the wave down.

Is anyone thinking about that?

I have in my watchlist the following ETFs:
SPXS
SPXU
SDS

Any thoughts?

#2

mine are not exactly flattering, so i will keep them with me :wink:

#3

USD lost a lot of value in a short period of time, it’s only natural S&P spiked as more than half of revenues are from abroad. Bonds tend to move neutral or opposite to stocks, business as usual.

Don’t get wiped out

1 Like
#4

Yep, don’t do it.
Usually, people successful at shorting are the ones who have evidence of a fraud or extreme weakness (ex : the guys who realized that the subprime synthetic CDOs were worthless in 2007).

if the only the only thing that makes you want to short the whole market is your gut, that is really not enough.
Let’s go back 20 years ago. In 1999 you could have thought that the market was overheated, but if you had shorted the NASDAQ, you would have lost most of your money.

Don’t forget that he market can remain irrational longer than you can remain solvent.

You are only one year away of reaching FIRE. Don’t do something silly right now.
If the current valuations are so high that you cannot sleep well, just get out of the market, or take an insurance with an option. But don’t short directly the market.

6 Likes
#5

I am with julianek. Trying to time the market for me is playing the Lottery. If you want to play the lottery, do so with cash you can easily afford to lose e.g. 1% of your portfolio

#6

And wouldn’t shorting automatically qualify you as a professional investor, subject to capital gains tax?

#7

Doesn’t matter if you lose it all :rofl:

2 Likes
#8

Damn, you wrote about shorting S&P500 and one day later it drops by 6-7%. I’m surprised the drop is so synchronized between stocks and cryptos. I was thinking the golden times of crypto will come when the stock market bubble (if there is one) pops. Might we be looking at the start of the next bear market? Strap in!

Btw, somehow I didn’t feel panic when I checked the charts this morning. I guess what helps is that I don’t follow it every day so I didn’t even know how much it gained “worth” over the last days. So it’s an easy come, easy go situation.

#9

better don’t check them at all :wink: besides for rebalancing, ofc^^

2 Likes
#10

I scored a 12% gain yesterday :money_mouth_face: but I sold the position.
I think that the market will rebound (hopefully) for the last final act before the pop hehe
I’m being extremist here maybe this was the Stock Market Blowoff, who knows

If it continues dropping I’ll jump in again with an inverse ETF…

Cheers!