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if you think the market will go down you should short it...
by robertcorey 8y ago
if you think the market will go down you should short it...
- rootusrootus 8y agoPretty much this. Market trends change how you invest, but they certainly don't prevent you from profiting either way. The last couple months have been particularly lucrative if you're shorting the market.
- malvosenior 8y agoWhat would be the best way to do this? Is there an index fund or something that is based on shorts? Sorry for the lack of knowledge.
- nemo44x 8y agothere's inverse ETF's. SPXS is a leveraged "bear fund" that gains value as the S&P500 decreases in value. SPXS is particular will move 3X the movement of the S&P500 so a loss of 1% in the market is a gain of 3% in SPXS. SPXS has been an awful fund to hold since 2009.
- matwood 8y agoBe careful with leveraged ETFs because of decay. They are really only good to hold short periods. https://seekingalpha.com/article/1864191-what-you-need-to-know-about-the-decay-of-leveraged-etfs https://seekingalpha.com/article/1864191-what-you-need-to-kn...
- vannizhang 8y agoI have n account with Charles Schwab and it's pretty straightforward to short a stock or etf: https://www.schwab.com/resource-center/insights/content/what-is-short-selling https://www.schwab.com/resource-center/insights/content/what...
- smogcutter 8y agoI'm pretty ignorant here, how do you short "the market"?
- no_one_ever 8y agobuy contracts for the ability to sell shares at a determined price later when the underlying share is actually worth less than what you are contractually allowed to sell it at.
- nodesocket 8y agoIf you don't know how to short, you should NOT be shorting. Shorting is incredibly risky with limited upside and unlimited downside.
- matwood 8y agoYou can do options, futures, short individual stocks, or even buy ETFs that take an inverse position. As someone else said, if you have to ask this question it's something to be cautious about doing. But, you have to start somewhere so good luck.
- smogcutter 8y agoI got a bunch of the same response, so I guess I didn't ask the question clearly. I'm well aware of how a short works. I was asking what parent poster had in mind when they said "if you think the market's going down, short it". Short what? Specific stocks? That's not the same thing as shorting "the market". When people say "buy the market" or whatever they're usually talking index funds or etc. So did he mean some kind of leveraged inverse VFINX? Or a baroquely complex derivates ETF that's just a ticking time bomb like those inverse VIX funds from earlier this year? Anyway, sorry for the late reply.