Unless I’m completely regarded… the VIX generally trends down. VIX measures volatility. The market is becoming less volatile while also generally trending up. So theta is the winning trend, sell call and puts?
downboat on
So PUTs are cheap now that Sahm Rule has been triggered?
Bears are about to get filthy rich.
TurtleProjector69 on
Buy long dated ITM VIX calls when it gets this low. It works every single time.
ber_cub on
One of the longest stretches without a 2% drop in years. This market won’t see anything but green till after the election.
Goldleader-23 on
I’m gonna buy puts harder now thanks
formlessfighter on
you have the exactly opposite and wrong interpretation of the data. there’s a saying: “when the VIX is low, watch out below. when the VIX is high, its time to buy”
there’s another saying: “just because something is inevitable doesn’t mean its imminent”
when you put these two pieces of old school wall street wisdom together, the understanding to take away is that when the VIX is low and stocks have consistently been pushing new all time high’s for a while, it’s time to **slowly start preparing** for either a big pullback or a crash.
what does it mean to slowly start preparing for a pullback or crash? it doesn’t mean to start selling everything off. it doesn’t mean to go crazy and short everything either. what you should be doing is:
1) start pulling profits regularly and consistently taking little bits of money off the table.
2) start building positions in defensive positions like bonds, VIX, US Dollar or conversely start building hedge positions like very slowly buying puts or building positions in inverse ETF’s
3) start rotating from your tech/growth sectors into defensive sectors like utilities and healthcare so you can stay long the market but reduce your risk exposure
the weightings of long vs short in your portfolio are up to you. are you desperate for money and you need to continue taking risk right up until the last moment? or are you financially ok so you can play it a little safer and not chase gains so much? or are you older and nearing retirement so you cannot afford to lose any money and thus you have to play things even safer?
7 Comments
Can anyone please explain in regarded terms?
Unless I’m completely regarded… the VIX generally trends down. VIX measures volatility. The market is becoming less volatile while also generally trending up. So theta is the winning trend, sell call and puts?
So PUTs are cheap now that Sahm Rule has been triggered?
Bears are about to get filthy rich.
Buy long dated ITM VIX calls when it gets this low. It works every single time.
One of the longest stretches without a 2% drop in years. This market won’t see anything but green till after the election.
I’m gonna buy puts harder now thanks
you have the exactly opposite and wrong interpretation of the data. there’s a saying: “when the VIX is low, watch out below. when the VIX is high, its time to buy”
there’s another saying: “just because something is inevitable doesn’t mean its imminent”
when you put these two pieces of old school wall street wisdom together, the understanding to take away is that when the VIX is low and stocks have consistently been pushing new all time high’s for a while, it’s time to **slowly start preparing** for either a big pullback or a crash.
what does it mean to slowly start preparing for a pullback or crash? it doesn’t mean to start selling everything off. it doesn’t mean to go crazy and short everything either. what you should be doing is:
1) start pulling profits regularly and consistently taking little bits of money off the table.
2) start building positions in defensive positions like bonds, VIX, US Dollar or conversely start building hedge positions like very slowly buying puts or building positions in inverse ETF’s
3) start rotating from your tech/growth sectors into defensive sectors like utilities and healthcare so you can stay long the market but reduce your risk exposure
the weightings of long vs short in your portfolio are up to you. are you desperate for money and you need to continue taking risk right up until the last moment? or are you financially ok so you can play it a little safer and not chase gains so much? or are you older and nearing retirement so you cannot afford to lose any money and thus you have to play things even safer?