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cooperthedog
Participant[quote=Chris Scoreboard Johnston]Index futures is the only way, the new rules only allow 3 days plus the day of entry before your brokerage firm will liquidate your position with or without your blessing in short side equity trades. S&P futures do not have that restriction. As a result you have to be dead on right timing wise to short individual stocks. This is one of the results of this wonderful government intervention. This takes liquidity out of the market and makes swings like we just saw in the last 45 minutes today more likely to happen. I am not sure if this applies to the SPY which is the stock proxy of the S&P futures. I do not trade that due to it being alot less liquid than the futures. If it does not and you prefer stocks to futures that might be the way to go or the Q’s if you want to short the Naz.[/quote]
Chris,
Index futures are NOT the only way.
SPY is not a proxy for SP futures, it is a proxy for the SP500 index. It is an investment trust that acutally holds each of the 500 stocks, with the same weighting of the SP500 index. It has a correlation > .99
SPY is not “alot less liquid” then spooz. They generally trade over 1 million shares per *minute*. The bid/ask is generally .01. At current prices, thats ~100 million dollars per minute (unleveraged vs. futures). So unless you’re a rather large institution, liquidity shouldn’t be an issue.
If you want a stock proxy for SP futures, use SDS or SSO, (short and long respectively). These ETF’s actually hold SP futures and swaps. They are “stocks” that are derivatives of a derivative (futures). These are levered 2x, fairly liquid, though nowhere near SPY, and highly correlate to the SP500 index intraday and so-so over weeks/months.
I would agree that shorting indexes is the way to go, but more so due to the risks that were always inherent shorting individual issues.
Using options to synthetically short individual stocks is another option, though the high volatility, and spreads make it less appealing…
As for the new 3 day rule, that should only apply to naked shorts. So as long as your broker can locate a borrow before you short, you are not subject to this rule, nor liquidation.
Participant[quote=Chris Scoreboard Johnston]Index futures is the only way, the new rules only allow 3 days plus the day of entry before your brokerage firm will liquidate your position with or without your blessing in short side equity trades. S&P futures do not have that restriction. As a result you have to be dead on right timing wise to short individual stocks. This is one of the results of this wonderful government intervention. This takes liquidity out of the market and makes swings like we just saw in the last 45 minutes today more likely to happen. I am not sure if this applies to the SPY which is the stock proxy of the S&P futures. I do not trade that due to it being alot less liquid than the futures. If it does not and you prefer stocks to futures that might be the way to go or the Q’s if you want to short the Naz.[/quote]
Chris,
Index futures are NOT the only way.
SPY is not a proxy for SP futures, it is a proxy for the SP500 index. It is an investment trust that acutally holds each of the 500 stocks, with the same weighting of the SP500 index. It has a correlation > .99
SPY is not “alot less liquid” then spooz. They generally trade over 1 million shares per *minute*. The bid/ask is generally .01. At current prices, thats ~100 million dollars per minute (unleveraged vs. futures). So unless you’re a rather large institution, liquidity shouldn’t be an issue.
If you want a stock proxy for SP futures, use SDS or SSO, (short and long respectively). These ETF’s actually hold SP futures and swaps. They are “stocks” that are derivatives of a derivative (futures). These are levered 2x, fairly liquid, though nowhere near SPY, and highly correlate to the SP500 index intraday and so-so over weeks/months.
I would agree that shorting indexes is the way to go, but more so due to the risks that were always inherent shorting individual issues.
Using options to synthetically short individual stocks is another option, though the high volatility, and spreads make it less appealing…
As for the new 3 day rule, that should only apply to naked shorts. So as long as your broker can locate a borrow before you short, you are not subject to this rule, nor liquidation.
Participant[quote=Chris Scoreboard Johnston]Index futures is the only way, the new rules only allow 3 days plus the day of entry before your brokerage firm will liquidate your position with or without your blessing in short side equity trades. S&P futures do not have that restriction. As a result you have to be dead on right timing wise to short individual stocks. This is one of the results of this wonderful government intervention. This takes liquidity out of the market and makes swings like we just saw in the last 45 minutes today more likely to happen. I am not sure if this applies to the SPY which is the stock proxy of the S&P futures. I do not trade that due to it being alot less liquid than the futures. If it does not and you prefer stocks to futures that might be the way to go or the Q’s if you want to short the Naz.[/quote]
Chris,
Index futures are NOT the only way.
SPY is not a proxy for SP futures, it is a proxy for the SP500 index. It is an investment trust that acutally holds each of the 500 stocks, with the same weighting of the SP500 index. It has a correlation > .99
SPY is not “alot less liquid” then spooz. They generally trade over 1 million shares per *minute*. The bid/ask is generally .01. At current prices, thats ~100 million dollars per minute (unleveraged vs. futures). So unless you’re a rather large institution, liquidity shouldn’t be an issue.
If you want a stock proxy for SP futures, use SDS or SSO, (short and long respectively). These ETF’s actually hold SP futures and swaps. They are “stocks” that are derivatives of a derivative (futures). These are levered 2x, fairly liquid, though nowhere near SPY, and highly correlate to the SP500 index intraday and so-so over weeks/months.
I would agree that shorting indexes is the way to go, but more so due to the risks that were always inherent shorting individual issues.
Using options to synthetically short individual stocks is another option, though the high volatility, and spreads make it less appealing…
As for the new 3 day rule, that should only apply to naked shorts. So as long as your broker can locate a borrow before you short, you are not subject to this rule, nor liquidation.
Participant[quote=Chris Scoreboard Johnston]Index futures is the only way, the new rules only allow 3 days plus the day of entry before your brokerage firm will liquidate your position with or without your blessing in short side equity trades. S&P futures do not have that restriction. As a result you have to be dead on right timing wise to short individual stocks. This is one of the results of this wonderful government intervention. This takes liquidity out of the market and makes swings like we just saw in the last 45 minutes today more likely to happen. I am not sure if this applies to the SPY which is the stock proxy of the S&P futures. I do not trade that due to it being alot less liquid than the futures. If it does not and you prefer stocks to futures that might be the way to go or the Q’s if you want to short the Naz.[/quote]
Chris,
Index futures are NOT the only way.
SPY is not a proxy for SP futures, it is a proxy for the SP500 index. It is an investment trust that acutally holds each of the 500 stocks, with the same weighting of the SP500 index. It has a correlation > .99
SPY is not “alot less liquid” then spooz. They generally trade over 1 million shares per *minute*. The bid/ask is generally .01. At current prices, thats ~100 million dollars per minute (unleveraged vs. futures). So unless you’re a rather large institution, liquidity shouldn’t be an issue.
If you want a stock proxy for SP futures, use SDS or SSO, (short and long respectively). These ETF’s actually hold SP futures and swaps. They are “stocks” that are derivatives of a derivative (futures). These are levered 2x, fairly liquid, though nowhere near SPY, and highly correlate to the SP500 index intraday and so-so over weeks/months.
I would agree that shorting indexes is the way to go, but more so due to the risks that were always inherent shorting individual issues.
Using options to synthetically short individual stocks is another option, though the high volatility, and spreads make it less appealing…
As for the new 3 day rule, that should only apply to naked shorts. So as long as your broker can locate a borrow before you short, you are not subject to this rule, nor liquidation.
ParticipantCongratulations TG! Gotta love it when a plan comes together.
ParticipantCongratulations TG! Gotta love it when a plan comes together.
ParticipantCongratulations TG! Gotta love it when a plan comes together.
ParticipantCongratulations TG! Gotta love it when a plan comes together.
ParticipantCongratulations TG! Gotta love it when a plan comes together.
ParticipantThis plan to *help* consumers is really a way for the banks to avoid taking a 100% loss if the consumer files for bankruptcy.
From the article, only those deeply in debt are eligible, and the maximum forgiven is 40%, and that is reserved for those “nearing a personal bankruptcy filing”.
Most credit card contracts have a default rate (eg 30%). So after a year of non-payment, your debt is now much higher, you’re about to throw in the towel, when your friendly bank allows you to avoid bankruptcy by forgiving up to 40% of your debt (roughly your penalty interest) and allowing you to pay of the “reduced”, yet original loan principal, over the next X years. In addition you can forestall the income tax you owe on the forgiven debt until you payoff the bank (then you get to make payments to the IRS), and the bank can wait to book its losses – everyone wins!
A consumer drowning in debt should just file bankruptcy and get it over with. 100% debt “forgiveness” and no income tax. Ruined credit and a lesson learned. The banks should take it on the chin for such poor business practices.
ParticipantThis plan to *help* consumers is really a way for the banks to avoid taking a 100% loss if the consumer files for bankruptcy.
From the article, only those deeply in debt are eligible, and the maximum forgiven is 40%, and that is reserved for those “nearing a personal bankruptcy filing”.
Most credit card contracts have a default rate (eg 30%). So after a year of non-payment, your debt is now much higher, you’re about to throw in the towel, when your friendly bank allows you to avoid bankruptcy by forgiving up to 40% of your debt (roughly your penalty interest) and allowing you to pay of the “reduced”, yet original loan principal, over the next X years. In addition you can forestall the income tax you owe on the forgiven debt until you payoff the bank (then you get to make payments to the IRS), and the bank can wait to book its losses – everyone wins!
A consumer drowning in debt should just file bankruptcy and get it over with. 100% debt “forgiveness” and no income tax. Ruined credit and a lesson learned. The banks should take it on the chin for such poor business practices.
ParticipantThis plan to *help* consumers is really a way for the banks to avoid taking a 100% loss if the consumer files for bankruptcy.
From the article, only those deeply in debt are eligible, and the maximum forgiven is 40%, and that is reserved for those “nearing a personal bankruptcy filing”.
Most credit card contracts have a default rate (eg 30%). So after a year of non-payment, your debt is now much higher, you’re about to throw in the towel, when your friendly bank allows you to avoid bankruptcy by forgiving up to 40% of your debt (roughly your penalty interest) and allowing you to pay of the “reduced”, yet original loan principal, over the next X years. In addition you can forestall the income tax you owe on the forgiven debt until you payoff the bank (then you get to make payments to the IRS), and the bank can wait to book its losses – everyone wins!
A consumer drowning in debt should just file bankruptcy and get it over with. 100% debt “forgiveness” and no income tax. Ruined credit and a lesson learned. The banks should take it on the chin for such poor business practices.
ParticipantThis plan to *help* consumers is really a way for the banks to avoid taking a 100% loss if the consumer files for bankruptcy.
From the article, only those deeply in debt are eligible, and the maximum forgiven is 40%, and that is reserved for those “nearing a personal bankruptcy filing”.
Most credit card contracts have a default rate (eg 30%). So after a year of non-payment, your debt is now much higher, you’re about to throw in the towel, when your friendly bank allows you to avoid bankruptcy by forgiving up to 40% of your debt (roughly your penalty interest) and allowing you to pay of the “reduced”, yet original loan principal, over the next X years. In addition you can forestall the income tax you owe on the forgiven debt until you payoff the bank (then you get to make payments to the IRS), and the bank can wait to book its losses – everyone wins!
A consumer drowning in debt should just file bankruptcy and get it over with. 100% debt “forgiveness” and no income tax. Ruined credit and a lesson learned. The banks should take it on the chin for such poor business practices.
ParticipantThis plan to *help* consumers is really a way for the banks to avoid taking a 100% loss if the consumer files for bankruptcy.
From the article, only those deeply in debt are eligible, and the maximum forgiven is 40%, and that is reserved for those “nearing a personal bankruptcy filing”.
Most credit card contracts have a default rate (eg 30%). So after a year of non-payment, your debt is now much higher, you’re about to throw in the towel, when your friendly bank allows you to avoid bankruptcy by forgiving up to 40% of your debt (roughly your penalty interest) and allowing you to pay of the “reduced”, yet original loan principal, over the next X years. In addition you can forestall the income tax you owe on the forgiven debt until you payoff the bank (then you get to make payments to the IRS), and the bank can wait to book its losses – everyone wins!
A consumer drowning in debt should just file bankruptcy and get it over with. 100% debt “forgiveness” and no income tax. Ruined credit and a lesson learned. The banks should take it on the chin for such poor business practices.
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