Assuming your 2X s&p position was taken before open of business today, you’re up almost 9%! Not a bad return for a whole year. Spectacular for just one day! How long to plan to let it ride? When do you take profits?
Honest answer? I only bought SSO with 10% of my portfolio yesterday, and the markets fell another few percent after I bought. So today I’m “only” up 4.4% on that particular position, which you must divide by ten to estimate contribution to overall porfolio. (A big 0.44%)
However, early this morning I also bought another 10% of my portfolio position 2X long the NASDAQ (ProShares QLD) after I saw markets moving a direction I liked. I’m also up about 5% in one day on that particular QLD position.
When gambling and this is gambling, I first take a nibble. Then if the market moves in direction confirming my initial prediction, then I take another nibble. (Pigs do get slaughtered, after all)
However, 25% of my portfolio remains gold “GLD”, and today’s paper losses in “GLD” are about equal to my paper profit in those other two long positions described above! So today is a wash.
So far, I’m thankful I sold half my gold yesterday, taking profits. So far, my hunch was right that gold will fall as stock markets now go into Fool’s Rally mode
As soon as this Fool’s Rally is near completing a total up move of 10%, I’ll dump my long positions on the S&P500 and NASDAQ. Markets are very nervous so less likely to reward with a big Fool’s Rally. We’ll be lucky to see 10%…unless the congress comes through by passing a gratuitous bail out package. And we are already HALFway towards completing that 10% Fool’s Rally, aren’t we?
