Calling all investment heads. How to make money in a downward market?

brettthejett

brettthejett

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Apr 8, 2006
I've been paying attention to the news lately and if anyone else has they know why I'm asking this question.
I strongly feel all markets are going to drop in the next year. This recession isn't the worst of what's to come.

How does one position themselves to make financial gain from a downward market? What can people do to avoid taking losses in the case of a real depression?

ADDED:

This video raises a lot of questions. 

What is he talking about, specifically? Anyone have any input???
 
Originally Posted by CuriousGeorg3

short sell
put options
and a lot of other stuff
Click to expand...

This basically.  Add inverse ETFs and that's about all for a retail investor. 

The thing with all of these though is they depend on timing.  You pretty much have to be exactly on time with placing the trades otherwise you will end up loosing money even if the market does end up going down.  It's not enough for you to "know" the market is going down, you have to know when exactly, within a week or two at most. 

If you don't have experience in this stuff I would stay away.  Or do a lot of reading. 

But yeah, by weeks end I am expecting a pretty big downward movement in the markets.
 
Originally Posted by brettTHEjett

I've been paying attention to the news lately and if anyone else has they know why I'm asking this question.
I strongly feel all markets are going to drop in the next year. This recession isn't the worst of what's to come.

How does one position themselves to make financial gain from a downward market? What can people do to avoid taking losses in the case of a real depression?

ADDED:

This video raises a lot of questions.�

What is he talking about, specifically? Anyone have any input???
Click to expand...
If you're thinking about trading in options, you're taking a HUGE risk.  If the stock isn't "in the money" when the options contract ends, you're going to end up losing a LOT of money.

My advice is stay away from the risky stuff like that and invest in solid companies for the long term.
 
Put options. Options are usually used to hedge your investments, but you can use them to make a lot of money. But of course, more money= more risk.
 
invest in solid companies for the long term


Yup. Ppl look at the money made in the stock market and think its a quick get in get out game. I mean you can but thats called gambling

I remember a dude from Met Life was talkin about the market and he made a joke about how the stock market is the ONLY place in this world where when things go on sale nobody wants to buy anything
laugh.gif


Unless youre close to retirement a down market is a GREAT time to invest for the long term like dude said. Thats where we're gonna make our millions
pimp.gif
Click to expand...
 
Originally Posted by FrankMatthews

Originally Posted by CuriousGeorg3

short sell
put options
and a lot of other stuff
Click to expand...

This basically.  Add inverse ETFs and that's about all for a retail investor. 

The thing with all of these though is they depend on timing.  You pretty much have to be exactly on time with placing the trades otherwise you will end up loosing money even if the market does end up going down.  It's not enough for you to "know" the market is going down, you have to know when exactly, within a week or two at most. 

If you don't have experience in this stuff I would stay away.  Or do a lot of reading. 

But yeah, by weeks end I am expecting a pretty big downward movement in the markets.
Click to expand...


-what are ways of telling where the markwet is going?-could you recommend reading material?-what exactly do you mean by "options" or am i just overthinking it?
 
Originally Posted by crcballer55

Originally Posted by go rilla

buy stock, take insurance policy out on said stock, claim stocks burned in a fire
Click to expand...

Please tell me you're talking about livestock...
Click to expand...
its more for brettTHEjett. he sold shoes to someone for a lower price than he wanted and said they were destroyed in a fire 
 
Originally Posted by Eff Ecks

Originally Posted by FrankMatthews

Originally Posted by CuriousGeorg3

short sell
put options
and a lot of other stuff
Click to expand...

This basically.  Add inverse ETFs and that's about all for a retail investor. 

The thing with all of these though is they depend on timing.  You pretty much have to be exactly on time with placing the trades otherwise you will end up loosing money even if the market does end up going down.  It's not enough for you to "know" the market is going down, you have to know when exactly, within a week or two at most. 

If you don't have experience in this stuff I would stay away.  Or do a lot of reading. 

But yeah, by weeks end I am expecting a pretty big downward movement in the markets.
Click to expand...


-what are ways of telling where the markwet is going?-could you recommend reading material?-what exactly do you mean by "options" or am i just overthinking it?
Click to expand...

If you are serious...go here

http://fnce.wharton.upenn...ms/undergrad_courses.cfm

and look up the books for those courses here

http://upenn.bncollege.co...mp;catalogId=10001&=

You can skip the corporate and econ. stuff
grin.gif



Google "stock options" and don't even think about buying any before you read the books for the Financial Derivatives course.
 
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