They will certainly reverse-split the shares, because this is s avery profitable fund that they'd like to make money on forever.
As to shorting the stocks, I am short both funds.
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FAZ/FAS math
- Thread starter privador81
- Start date
They will certainly reverse-split the shares, because this is s avery profitable fund that they'd like to make money on forever.
As to shorting the stocks, I am short both funds.
Quote from mastergutah:
They will certainly reverse-split the shares, because this is s avery profitable fund that they'd like to make money on forever.
As to shorting the stocks, I am short both funds.
can we short these stocks or not?
trader666 your arguments are correct, the name calling is not
thanks
shorting both faz and fas at the same time is pure lunacy. jprad, i dont know why you keep countering this, just fade away from this thread dude.
Theory:
Faz at 100
Fas at 100
For the next 20 days, each day the underlying raises 1%.
Day1:
Faz: 100-3(3%)=97
Fas: 100+3(3%)=103
Day2:
Faz: 97-2.91(3%)
Fas: 103+3.09(3%)
etc...
A sane person would already see the problem, the two triple etf mimics the DAILY PERCENT movement. So as the price goes lower in the faz example, the ACTUAL DECREASING DOLLAR amount becomes smaller, and on the opposite as the price of fas goes up, the ACTUAL INCREASING DOLLAR amount becomes bigger.
And if you are shorting both, you will lose more money from fas than gained from faz, this loss will become bigger and bigger over time.
Real world: Look at Nov 10, 2008 to Nov 21, 2008.
On 2008/11/10 open
Fas: ~52
Faz: ~63
On 2008/11/21
Fas(LOD): ~11
Faz(HOD): ~200
So if you shorted both on 11/10. You would lost ~135 on faz, and gained 41 on fas. For a net loss of ~90 a share, which will sure to trigger a margin call.
Note: I agree with the fact that those triple etf is losing value over time due to the way they are structured, but shorting both at the same time is just plain retarded.
It's not rocket science fellas.
Theory:
Faz at 100
Fas at 100
For the next 20 days, each day the underlying raises 1%.
Day1:
Faz: 100-3(3%)=97
Fas: 100+3(3%)=103
Day2:
Faz: 97-2.91(3%)
Fas: 103+3.09(3%)
etc...
A sane person would already see the problem, the two triple etf mimics the DAILY PERCENT movement. So as the price goes lower in the faz example, the ACTUAL DECREASING DOLLAR amount becomes smaller, and on the opposite as the price of fas goes up, the ACTUAL INCREASING DOLLAR amount becomes bigger.
And if you are shorting both, you will lose more money from fas than gained from faz, this loss will become bigger and bigger over time.
Real world: Look at Nov 10, 2008 to Nov 21, 2008.
On 2008/11/10 open
Fas: ~52
Faz: ~63
On 2008/11/21
Fas(LOD): ~11
Faz(HOD): ~200
So if you shorted both on 11/10. You would lost ~135 on faz, and gained 41 on fas. For a net loss of ~90 a share, which will sure to trigger a margin call.
Note: I agree with the fact that those triple etf is losing value over time due to the way they are structured, but shorting both at the same time is just plain retarded.
It's not rocket science fellas.
Lucky I shorted 5000 each a week ago Monday. BEFORE I read here that the shares are not available.
BEFORE I read it is a stupid trade.
Lucky . I am up10k + on 50K of equity pledged. I'm holding for 1.
For the guy who postulates large losses when one side goes up day after day, let me say that when trees grow to the sky, I'll worry. I haven't seen anything like 20 days in a row of continuous moves in Anything..
You have only to look at comparison (overlay) charts of FAZ & FAS to know double shorts will work. To the guy who said to go long both sides, let me say, "Thanks for the 10K! Hope to see you next week also."
BEFORE I read it is a stupid trade.
Lucky . I am up10k + on 50K of equity pledged. I'm holding for 1.
For the guy who postulates large losses when one side goes up day after day, let me say that when trees grow to the sky, I'll worry. I haven't seen anything like 20 days in a row of continuous moves in Anything..
You have only to look at comparison (overlay) charts of FAZ & FAS to know double shorts will work. To the guy who said to go long both sides, let me say, "Thanks for the 10K! Hope to see you next week also."
Quote from Trader666:
Yup... the losses from one side can easily FAR overcome the gains from the other.
That is true in every hedged investment that is initially perfectly offset, but which is not continue even.
However, the anti-doubeshort people keep postulating a singular-line move, without reversals. That is exceedingly rare. The double-short strategy is designed to capture volatility, of which there is plenty here, and not uni-directional moves; which are rare at best.
ROTFLMAO!!!!! Yeah... you have a lot of credibility (NOT) with your first post being yesterday and now you're defending the idiotic strategy recommended by winstontj who coincidentally just changed his nic to Pepsi Worker after I warned him his compliance department wouldn't like his stupid posts.
Quote from mastergutah:
Lucky I shorted 5000 each a week ago Monday. BEFORE I read here that the shares are not available.
BEFORE I read it is a stupid trade.
Lucky . I am up10k + on 50K of equity pledged. I'm holding for 1.
For the guy who postulates large losses when one side goes up day after day, let me say that when trees grow to the sky, I'll worry. I haven't seen anything like 20 days in a row of continuous moves in Anything..
You have only to look at comparison (overlay) charts of FAZ & FAS to know double shorts will work. To the guy who said to go long both sides, let me say, "Thanks for the 10K! Hope to see you next week also."
If you knew anything about trading you wouldn't have posted this:
http://www.elitetrader.com/vb/showthread.php?s=&postid=2396731#post2396731
And you'd know there are MUCH better trades from a risk/reward standpoint.
http://www.elitetrader.com/vb/showthread.php?s=&postid=2396731#post2396731
And you'd know there are MUCH better trades from a risk/reward standpoint.
Quote from mastergutah:
That is true in every hedged investment that is initially perfectly offset, but which is not continue even.
However, the anti-doubeshort people keep postulating a singular-line move, without reversals. That is exceedingly rare. The double-short strategy is designed to capture volatility, of which there is plenty here, and not uni-directional moves; which are rare at best.