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911-caused-it-all

Ftse Due A Correction?

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Sat 26th Sept 09

FTSE 100 Index 5,082

52 Week Range Volume 3,461-5,212

52 Week Change -114.80 -2.21%

The FTSE currently sits 2.21% lower than it did a year ago before the recession even hit. I like most others who during this time frequented this forum more than they might have had there 'not been a crash' have probably missed the boat on equities bouncing since the March bottom. There must be a fair few of us sitting on unused deposits we could have bumped them up by 50% in that time seemingly by buying more or less any shares we punted on.

They tell us not to be greedy or give in to envy, which is what I'd call joining the rally at this time. Surley now we've missed the boat?

Is the FTSE due a correction? I for one would like to not miss the boat and make something from this unique situation even through the back door.

At this moment in time, my punt is to short the FTSE (LSE:SUK2) whilst at the same time buying a selection of stocks that still have value in them. I've just loaded some funds into self trade, ready to roll.

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The FTSE currently sits 2.21% lower than it did a year ago before the recession even hit.

A year ago, the FTSE was about 20% down from the beginning of 2008.

I like most others who during this time frequented this forum more than they might have had there 'not been a crash' have probably missed the boat on equities bouncing since the March bottom.

I've made lots of capital gains since March, to the extent that my portfolio is about 20% up since the FTSE was around 6000. But I also lost on the way down. I expect most people who've made good gains in the past six months have yet to recoup their losses from the previous year or so.

At this moment in time, my punt is to short the FTSE (LSE:SUK2) whilst at the same time buying a selection of stocks that still have value in them. I've just loaded some funds into self trade, ready to roll.

Tempting strategy - the amateur hedgie! Mine is more to bet on the falling £, by diversifying (particularly eastwards) into assets that derive value from currencies that aren't being debased (or at least, not on the kind of scale we've got here).

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Tempting strategy - the amateur hedgie! Mine is more to bet on the falling £, by diversifying (particularly eastwards) into assets that derive value from currencies that aren't being debased (or at least, not on the kind of scale we've got here).

That sounds like a good strategy also, being a newbie at this I haven't any losses to recoup but appreciate what you mean when you say others have only recovered partially from being exposed to previous highs.

I may go down the path of using a profesional cfd company so I don't have to pay capital gains etc. and use the help of an 'expert' to make my bets and suggest when to get in and out. I'll mention east, weaker pound and lower Ftse to them and see what they suggest.

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SUK2 Looks like a X2 leveraged fund for me anyone who goes short expecially leveraged timing must be near perfect or you can easily loose your shirt good luck anyway but i will offer some concerns you may not of thought of.

I think the GBP could easily drop 20% this year if this happens this would give a big boost to the ftse because of the currency earnings increase with companys reporting or trading in other countries.

Inflation increasing with higher import costs and the competitive edge for exportes and M&A action by other lands buying our companies cheaper.

Merv talked the pound down this week remember the election is coming and the ftse liked it.

I can think of many things to take it down too but given the very loose fiscal actions the market should be exploding up and it may do to.

I think long term the market probaly will take out the march lows but I think thats after the next election and rapid if labour win Timing is key and a 50% or so jump looks good to short but the loose money around the market for me will top 6 or 7K before the shoe drops bigtime then its some kind of rampent inflation or deflation and hopefully its deflation and if thats the case a leveraged short will rocket but the amount of money lost in the short fund would probably not recover if the bull lasts until the next election.

The trend is your friend I would only consider a short in a falling trend rather then guess a top for me and at 5k the ftse is in the 1998 level thats not too high and certainly not a screaming short China looks toppy.

If you are lucky and a pull back happens in the next few weeks and you make a nice 10 or 20% take profits anyway I am waffling

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SUK2 Looks like a X2 leveraged fund for me anyone who goes short expecially leveraged timing must be near perfect or you can easily loose your shirt good luck anyway but i will offer some concerns you may not of thought of....

The trend is your friend I would only consider a short in a falling trend rather then guess a top for me and at 5k the ftse is in the 1998 level thats not too high and certainly not a screaming short China looks toppy.

If you are lucky and a pull back happens in the next few weeks and you make a nice 10 or 20% take profits anyway I am waffling

That's great food for thought, I was thinking along the lines of hoping there would be a drop back in the FTSE in the next few weeks, then taking a quick profit before it resumed it's accent. As you say timing would be risky unless the trend is already down. Thanks for the reply.

Edited by 911-caused-it-all

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Is the FTSE due a correction? I for one would like to not miss the boat and make something from this unique situation even through the back door.

At this moment in time, my punt is to short the FTSE (LSE:SUK2) whilst at the same time buying a selection of stocks that still have value in them. I've just loaded some funds into self trade, ready to roll.

All about timing. You can be right about the trend, but mistiming your investments will leave you with an overall loss.

Why not spread bet with a few hundred quid, until you get the hang of shorting? Lesson worth learning.

My guess is FTSE 100 will go down to about 4600, then up to about 5900, before crashing to a higher low above the March madness. And we start all over again. No idea on the time period.

Unleveraged positions against £ seem a more sedate way of going about it.

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I may go down the path of using a profesional cfd company so I don't have to pay capital gains etc. and use the help of an 'expert' to make my bets and suggest when to get in and out. I'll mention east, weaker pound and lower Ftse to them and see what they suggest.

Capital gains? You do know the first £10k of capital gains is tax-free, and you can average out gains/losses over many years? You expect to make more than that, why not do it inside a SIPP? And your ISA allowance for however many years you hold?

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I may go down the path of using a profesional cfd company so I don't have to pay capital gains etc. and use the help of an 'expert' to make my bets and suggest when to get in and out. I'll mention east, weaker pound and lower Ftse to them and see what they suggest.

Contracts for difference do carry Capital Gains, only spreadbets dont

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