1 reply to this topic

[AChartist]

Well my 401k is down $100 balance from the recent peak,
I was mostly going with smallcaps funds of highest 3mo performance,
with some other diversifications.

I could see a drop in 2 weeks from now but staying long through it
on 401k trading restrictions and planning for last high in about 9 weeks,
Christmas all along.

Chances are it goes up first and the technical hit in say 2nd week, holds a high level.

That is the next 9 week peak, with some other things syncronized down,
it can right translate. Sometimes it will hover to the right and drop late
abruptly, not meant for exact timing in that way.

My brokerage account found some decent low priced Feb and March
calls on speculative midcaps that are up for now but might take a
hit in 1 or 2 weeks. Looking at Christmas final high that could be Jan,
went with Feb-Mar calls.
Almost all calls are too expensive otherwise and wont work.

Now I may not attempt to profit in the early 2014 drop but at least
have the 401k 50% hedged, and try to profit with 6 month puts in a
brokerage account, after some immediate signals occur and others here
chiming in on the big one.

RUT Week

Edited by AChartist, 05 October 2013 - 10:31 AM.

[arbman]

If you believe that the volatility will continue to remain low, you can still sell futures puts and sell futures short and then buy futures calls in the weeklies and a few weeks ahead maturities (either RUT or SP futures). This significantly reduces the cost of the calls (due to the premium sold in puts) and also hedges to the downside up to 2-3%. However, the key here is you still believe the market will not crash or have a 4-5% decline quickly. It can be balanced to make money regardless within the +/- 3% band, but the problem is the volatility is slowly increasing now...

Edited by arbman, 06 October 2013 - 02:18 PM.