3 ms·

You buy an ETF that shorts the S&P500: http://www.proshares.com/funds/sh.html http://www.proshares.com/funds/sh.html

• Pyxl101 11y ago
  Is there a way to bet that something will grow more slowly than normal? S&p 500 has been growing about 10% per year. How would I "short" it and bet that it will grow 5%? Can such a position be constructed?
  • yummyfajitas 11y ago
    Straddle option on SPY with K=1.05 x SPY today. https://en.wikipedia.org/wiki/Straddle https://en.wikipedia.org/wiki/Straddle If you want to get clever and derisk a bit you can also limit your losses in the tails with way out of the money calls and puts.
  • um_ya 11y ago
    If you have never traded before, don't try to jump in without knowing all the possibilities. A more likely scenario to unfold, is that Janet Yellen does NOT raise interest rates and instead, starts QE4. In this scenario, the dollar will tank and stocks (priced in dollars) will go up. Just be cautious.
• lujim 11y ago
  Be careful with inverse ETFs especially if they are leveraged to move 2x or 3x in the opposite direction of the underlying index. They try to be inverse for each single trading DAY so if the market moves back and forth you can take geometric losses. For instance, if you have 100 dollars in an inverse etf and the market goes up 10% your inverse etf will go down to 90 dollars. The next day the market drops 10% so you think "hey my inverse ETF will go up 10% so I'm back to where I started" Nope a 10% gain on 90 dollars puts you at 99 dollars. If the market moves sideways for a while your investment will continuously decline.