Bad market times are great times for stocks which bet against varies indexes and sectors in the stock market, I have compiled a list of the stocks that do well when the index does not. These stocks are called ETF short or ultra shot.
If you have the ability to do a lay over chart you can see that the stocks listed below each index rely on that index doing badly, who says you cant make money in a bad market.
This not short selling. For a long time Proshares was the main player in the ultra short inverse market. In one year these stocks which numbered under 40 now jumped to almost double that amount. New to the shorts Rydex, Deutsche Bank, MacroShares, PowerShares, Direxion, and the list keeps growing.
Difficulty: Moderately Challenging.
Selling short or option purchase are not an option when the ETFs are in an IRA or 401K because of an IRS ruling. I do not recommend short selling or options for a beginner in the stock market.
Practice—practice—practice. learn what you’re doing before you invest your money, there are many sites to practice a mock portfolio tickerspy.com is one of those sites.
Learn the difference between a BULL and a BEAR market, each type requires a different investment tragedy.
Before the market opens, the news normally tells you what the futures market is doing. When the futures are down the market normally follows the futures on the opening. Yahoo and Google have pre market reports which show the futures in detail.
It’s not wise to buy at market price. I normally place a limit buy on the stock I want to purchase and a trailing stop to capture my gains in the event the market turns, which can occur on the slightest bit of news.
Play on paper or in mock portfolio till you learn.
Tips & Warnings
- Join some social stock sites.
- Do your homework, don’t invest on a hot tip.
- You only get to loose your money once!