ETFs are great! Going short, of course
25 Febrero 2010 3 Comments
Taking advantage of the fact that all ETFs perform very poorly in comparison with their underlying, we are going to sell one ETF that replicates the reverse SP500. The SPXU.
If the SP500 goes down, the SPXU would go up and this would work against our strategy. In order to avoid this problem, we will cover this operation by selling one mini SP500 future.
The bargain would look as follows:
1 mini SP500 future sold
500 shares of SPXU sold
Then, we just reap the benefits and do whatever we want
The following graphic shows the SP500 at the top and the two instruments added together at the bottom, and clearly shows the money trickling into your pocket.
Enjoy.
Idea already seen in an Spanish blog; there must be something wrong here, i do not feel like duplicating information so blog deleted from my list.
Both blogs are from the same author. They don’t usually duplicate entries, this is the first time, so I wouldn’t remove it yet.
To translate an idea does not mean duplicating it, but allowing others to understand it.
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