ES Journal - 2021/2022

Here is what I mean when I say that ES/SP is a "long only" market. This is a picture of what has happened since 1971---
upload_2022-3-12_22-36-42.png
 
ES is a futures contract. I.e., there are two counter parties for every transaction, a long and a short. To call ES a “long only” market is to not understand what a futures contract is. In addition, it expires every quarter. Putting up a chart of something or other from 1971 is to, again, misunderstand the function of a futures contract.

Trading futures is a zero-sum game. The winners’ profits come from the losers’ losses. Most people are losers. They are losers because they do not think and act as the winners do.

It is important to me that people think as BuySell does. I expect to be trading at least another 20 years.
 
savoir said:
ES is a futures contract. I.e., there are two counter parties for every transaction, a long and a short. To call ES a “long only” market is to not understand what a futures contract is. In addition, it expires every quarter. Putting up a chart of something or other from 1971 is to, again, misunderstand the function of a futures contract.

Trading futures is a zero-sum game. The winners’ profits come from the losers’ losses. Most people are losers. They are losers because they do not think and act as the winners do.

It is important to me that people think as BuySell does. I expect to be trading at least another 20 years.
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I think you misunderstand what I am getting at. Also, for clarification, that is not a futures chart. It is the cash chart.
 
Buy1Sell2 said:
I think you misunderstand what I am getting at. Also, for clarification, that is not a futures chart. It is the cash chart.
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I think it's undisputable that historically the long term trend is up and that there's a natural updrift to the stock market indices over time. I just don't agree with the characterization of "long only" as it's clearly a market that swings both ways.
 
Zwaen said:
While I also ‘think’ we are in bear market territory this year, and possibly ‘23, when you open an very longterm chart (100 years) we have still corrected (spx)only a minor blip and I can easily see the market running up more. This would just be eyeballing a chart and completely ignoring the fundamentals, which have changed (qe, zirp). And if we correct say 50%, why wouldn’t it run again like it has done before?
And for politicians/leaders, isn’t it better to always have a rising stockmarket (even if we ignore inflation)? I understand this sounds simplistic, but i think most people buy into the perception a rising stockmarket benefits them, even if it weren’t only psychologically. It just ‘sells better’. Look for example at all the people bragging about the risen prices off their homes at party’s (while this has no real benefit to them if they posses one home).
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March 2000 to October 2002 (31 months) - a 50 % correction on SPX.

October 2007 to March 2009 (17 months) - a 58 % correction on SPX.

I'm not sure anyone is saying the market is going to permanently correct. Historically, every correction on SPX have been just that. A correction.

Between March 2000 and March 2013 the market was moving sideways in one large trading range not really going anywhere. So, that's 13 years to break even if you held index funds.

It was the start of QE in 2010 which really got the stock market moving in this incredible up trend we've seen over the last 12 years. No doubt there's a lot of political interest in keeping the stock market rising, but with raging inflation in the market I'm not sure if the FED and the government can keep supporting the market much longer.
 
Here is a chart of the S and P from 1872 onward, but not totally to today's date. As one can see, S and P is a "long-only" market. Are there shorting opportunites? Certainly there are but they are typically short lived and the overall bias is long.

upload_2022-3-13_11-37-28.png
 
Here's the question that needs to be asked with regard to whether SP is a "long-only" market----"Can I short and hold over the long term and expect to make a profit?"----The answer is apparent.
 
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