You only have to show up at 3:00 PMYou don't need to know anything about stocks or do any research, just have 2-3 ETFs ready to play
And away we go...
We just crossed over S&P 770, and just rallied 2% in a few minutes. So funny. It's all a roll of the die and the only hour that matters is 3 - 4 PM.
Stock fundamentals? Research? Thinking? That's so old school.
Well we have 45 minutes to go which means the market can now move 5% up or down. Place your bets - red or black.
Interesting stat of the day: I read this week that ETFs as a % of all trades now are up from 20% to 40%. Showing you what we've been doing is what many others have now adopted. The abandonment of individual stocks since fundamentals mean nothing, and just ETF trading left and right. I don't blame anyone for this in an era where you buy stocks with a 3 PE ratio growing 40% and you can lose 50% within a few days.
I'm very tempted to buy Ultra Real Estate (URE) just for a trade @ $3.33. Could be back to $5 in a blink of an eye. EDIT: Ok I did buy this entity. This is the opposite of Ultrashort Real Estate (SRS). I'm betting my chips on red i.e. Paulson says more TARP money for Citigroup aka United States of Citigroup by Sunday night. This is only for a trade - when SRS loses $100+ we'll reverse back.
5 comments:
Congrats on your "casino pick" URE! The commercial real estate market is totally going to disappear over the next few years but it's not gonna happen immediately so why not scalp trade URE at $3.33? At these levels it's practically a call option.
I picked up some TNA at $17.60 and sold half into the close (that's my first winner in a long time ;-)
Exactly
Nothing in a straight line - the SRS dropped from $284 where I let go of quite a bit to $216 in the last hour as well.
I didnt get $3.33 here, due to the Marketocracy rules although I got it in my personal account just over. With the juicy $450 commisson due to number of shares I bought and the slow execution I ended up getting it for $3.60
pathetic
but a nice Citigroup takeover should take it to $5+ and it still is a decent trade.
Anyhow good job on rolling your dice - would you like a drink from one of our hostesses? Remember, the casino now only is open from 3 pm to 4 pm. Well technically we are open from 9:30 to 3:00 Pm as well but we have very few visitors; high rollers all show up at 3.
Flight from stocks is just part of it. We also have a flight from funds. And because fund managers are heavy cash, they too have to play (which may well be part of the 3PM roller-coaster).
I was looking at the Ultra ETFs, and all the Ultra Shorts dropped big time this afternoon. I heard the caution twice yesterday to cover your short ETFs before teh weekend and the beginning of the holiday week ahead. Looks like investors agreed.
As a result, I looked at URE and UYG. Not too sure about URE for the long run... Too many problems to go. But I am considering UYG (Ultra Financials) as I suspect that even with Paulson's back peddling on the bailout, that we may have seen most of the ugly news here. At least for awhile..
jegan
URE and UYG and SKF and SRS really trade together for most of the time
SKF obviously did not during that banned shorting period
SKF was the leader last fall and winter, and SRS lagged because SKF is a financial short and SRS is a play on the economy. People were in denial - I had equal amounts of both and SKF would make me money all the time and SRS never. Now that has changed of late and SRS makes me more money.
I didnt say URE is a great long term bet - I am saying its a nice trading tool in the casino.
I just checked - the last time I owned URE for a trade this summer it was $28. Not it's in the $3s
I'll take the risk reward - its not an individual company so it will be tough to go to zero. :)
If I can get north of $5 I'll be happy.
Could go higher than that. You'll get very similar action in UYG.
Can our hostess get you a drink? Will we be seeing you at 2:59 or 3:01 PM Monday?
Please make reservations - we get VERY busy around that time.
TM,
You are correct about the pairings. You can pretty much throw in FXI/FXP and EEM/EEV. They all tend to trend the same, although FXP is a little jerky.
Re: "I didn't say URE is a great long term bet - I am saying its a nice trading tool in the casino." ... I understand. I just always look at the fundamentals even on short trades. My take is that there is more chance of bad real estate news and more chance of a Citibank surprise. (As well as the naming of Paulson's replacement), which would in my mind lend more credence to an earlier and possibly stronger uptick for UYG. Personally, owning banks, real estate, autos or airlines give me the chills here, but I did buy UYG.
However, Mike Paulanoff suggests that as the QQQQ stayed above $26.50 on an optins expiration day, that we have a good shot at a short term rally (and therefore the same in the DOW and S&P).
Couple that with the State Street weekly report I just rec'd :
"Next week, we receive revisions to third-quarter GDP estimates.
We anticipate a (very) slight downward revision to the US.
Meanwhile there is just a chance for a (relatively) positive housing print out of the US."
You could easily have made the right call. At the price for either UYG or URE, $5.00 doesn't seem like much of a leap. Hope it works!
jegan
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