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Biotech / Medical : Immunomedics (IMMU) - moderated
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To: ghettogoulash who wrote (56130)5/3/2020 2:02:49 AM
From: ghettogoulash2 Recommendations

Recommended By
Farmland
royalbg

  Read Replies (1) of 63276
 
Hedging (Cont.)

Puts are too expensive. Shorting an index can be very expensive-- with unlimited loss potential. I've decided to "short" the Dow Jones Financials by buying ETFs, specifically ProShares UltraShort Financials. On Thursday I bought SKF, a fund designed to be two times (2x) leveraged inverse exposure to the Dow Jones U.S. Financials Index. On Friday the DJI was down -2.55% and SKF ended up +6.17%.

I cannot explain this chart. Maybe someone here can. Why did this fund enter the exchange around $1000, top out around $4000, and now is priced around $16? Is part of it buying interest, like a stock? If so, this could be quite lucrative. This week I will be buying some ProShares UltraPro Short Financial Select (FINZ), which seeks (3X) inverse exposure.

Caveat: day to day volatility can erode the value of an ETF, as explained below. However, (1) I don't expect an abundance of up days in the markets for the remainder of the year; (2) for me this is a hedge against a severe financial meltdown, perhaps overnight; and (3) I like the lows of the SKF price chart.

fool.com

Six Ways to Short Financial Stocks with ETFs | Nasdaq
nasdaq.com

What Is The Creation/Redemption Mechanism? | ETF.com
etf.com


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