What would you do if your account was in this situation?

Quote from xif99:

is that the rule for all the 2x weighted index ETFs?
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Xif,

Fib beat me to the answer. :)

I would suggest taking a good look at some of the 2x and 3x funds, and performing a correlation against the SPX or Russell 2000 (maybe even SPY or IWM), or whatever instrument they are associated with - - - you might be surprised how the correlation is not as close as you think.

AZD
 
Quote from arizonadreamer:

Xif,

Fib beat me to the answer. :)

I would suggest taking a good look at some of the 2x and 3x funds, and performing a correlation against the SPX or Russell 2000 (maybe even SPY or IWM), or whatever instrument they are associated with - - - you might be surprised how the correlation is not as close as you think.

AZD
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Holy crap!

So what you should do if expecting a bull market return is short the 2x inverse ETFs. do they have positive expectancy over time? :D :eek:
 
Quote from xif99:

you own 100 shares of SPY with an average cost of $100 (held over 1 year)

You own 100 shares of DDM with an average cost of $28. (held under 1 year)

You have $3k cash in your trading account.

What would you do?

Sell everything and start buying SSO with a small position and average down if it continues to drop?

Otherwise you're looking at years before your SPY is back up to break even.?
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what's your regular ET nick? come on, don't be shy.
 
Quote from lescor:

Forget about where your position used to be, what your average price is, where you think it 'should be', etc. It's worth what it's trading at right now. The market doesn't care what you paid for it. Mark your positions to the market every day, don't focus on getting back to break even. Remember that hope is not a viable strategy.

"It's not a loss until you sell" is the motto of Loserville.
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I agree 100%. Allowing large open-loss/gaping wound positions to develop damages the psyche more than anyone will admit. Today's up day probably created a large amount of buyers anxiety in a lot of traders. Especially those with large open losses trying to get back to break even. Unfortunately, this cycle of emotions compounds the problem. This is the personality of a bear market.

I don't really have any advice except not to chase lost money. All the best to your trading.
 
Quote from NeoRio1:

First of all you're an idiot for using the buy and hold strategy. Sorry, I say that to all Buy and folders.

Secondly you are an even bigger idiot for not following the one rule you need to follow when it comes to your strategy. Buy and HOLD. You have to hold no matter what. That is the strategy. Taking your money out or increasing the leverage in a long account when the market is tanking is going against your one simple rule.

Keep things where they are at and hopefully you will be at breaking even in 10-15 years.

Every investor who trys to break even once they have lost 40% of their money ALWAYS loses more money. A good amount lose all their money. Same with traders.
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10-15 years! HA HA HA HA HA HA HA
I wonder how it all turned out for Xif. This thread should be saved and studied as it nailed the exact bottom and the corresponding emotions to a tee.
 
Yes. That's awesome. Perfect real-time narrative of the heart of why simple opportunistic decisions become confused nauseating decisions when cost-basis is bad.

Also perfect in fleshing out why capitulations happen, even though "everyone" knows they are opportunities.
 
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