We are still holding the TZA which is now at $52.9 in most client accounts, for a very nice $8 gain in just a few days. At present I’ve entered a stop order to sell at $52.5 to preserve our gain in case the markets give up like the Red Sox in the 9th inning.
The current trading environment is very similar in nature to what we experienced in 1987 and 2008 post crash. Back then we experienced a sawtooth trading environment with weekly whipsaws reflecting economic news changed daily, not a place for long term investors to add new positions. Markets need time to heal and its very very rare for them to simply bounce back up after a significant selloff.
I’ve been very hesitant to talk about individual stocks for a couple of months since we have very few full positions for client accounts. As the recent TZA trade reveals, the last two best trades I’ve made have been in Inverse Exchange Traded funds. Stocks still seem heavy to me and our investment models are still bearish, earnings are still coming down and in my opinion still have a much greater downside.
In the meantime I’m quite content to make money with Inverse ETF’s while the 11000 – 12000 trading range continues for the SP 500 index.
TZA sold just now at $52.5 nice
Formerly long TZA
Short Red Sox
Long San Francisco