April 10, 2009

Here's SKF - Ultrashort Financials, which was used by some hedge funds to destroy the world financial system. Not working out too good lately though..


Amazing that the banks could nearly fail, and SKF loses its investors' money.

Nuff said.

Invest wisely.

And watch out for scams. They're everywhere at the casino these days.

Don't even get me started on OIL.



18 comments:

Anonymous said...

The SKF tracks 2X the inverse of the DAILY performance of the XLF (Financial Sector). Not the overall It is a day trading vehicle.. these leveraged ETFs are not to be held overnight. It gets a bad wrap because bulls say it creates 18 billion in selling pressure everyday.. but what they don't like to tell you is that it generally creates 18 billion in buying pressure as well when traders close their position (usually intraday)

casey said...

casino royal about sums that up.Hope no one bought at 200.Get out why you can.

Maybe try UYG?

Anonymous said...

FAZ / FAS are even a bigger scam.

SRS seems to be in the scam category too!

The market is crazy... How in the world can Wells Fargo report a RECORD profit?

Must be all those loans their making... huh? Must be all those foreclosures that they are saving... huh? Must be from the credit line decreases and credit card interest increasing... huh?

I guess we should expect all the banks should be paying back their TARP, Monday... huh?

So, there is this PANIC now to buy! I thought all banks were headed to ZERO? Banks are insolvent?

Come on! Ruby Tuesday, Olive Garden and Panera Bread are raking in the profits... Don't-cha Know?

Can't fight the trend up... You will get burned. GS is reporting next week. I can only assume that they will continue the Bull Move.

Ross said...

What about FAZ from yesterday's trading? O.U.C.H.

Anonymous said...

SKF used to destroy the world financial system?

how d'ya figure?

trpm

Anonymous said...

Do you understand how a stock market works, Keith?

You can place a bet on red or black. And you stand a chance of losing either way. If all you can ever do is bet on black, who's going to play such a game?

You wouldn't be trying to keep a bubble inflated like some sort of commie, would you?

keith said...

UYG has been very nice lately...

On SKF, it was used for quick bear raids by hedge funds. Similar to naked shorting. Much too much written about this to post here - just google it and start reading

Meanwhile, oil is up 50% or more from the bottom, yet look at the OIL ETF.

Suckers and their money are parted so easily in this market. You didn't need a Maddoff. The SEC gave punters so many ways to lose it all.

Anonymous said...

oh sure, blame it on the shorts.

if it wasn't for the shorts the highly over leveraged financial industry would have been just fine!

bad shorts. evil shorts.



problem is, short positions actually create buying activity (as they cover) when the market (or a stock) drops.

clueless idiots.

Anonymous said...

Anyone who thinks that legitimate (covered, not naked) shorting of stocks can destroy an otherwise solvent company doesn't understand money or markets. That includes you, Keith.

First, covered shorting is a simple transaction. You borrow stock from someone else and then sell it. This means that for each share short, you must buy that share back sometime in the future, driving the price back up. No one gets a free lunch.

Most importantly, a company only makes money from stock when they first issue and sell it. After that, the stock price is irrelevant to the cash flow of the company itself. My company's stock could sell for $0.00 and it wouldn't change our earnings report by a dime.

The only time a low stock price can actually harm a company is if the company is out of money and going bankrupt anyway. In that case, many companies will sell more of their own stock (a "secondary offering") in order to raise more money.

Naked shorting, in contrast, is fraud, and I strongly agree that it must be banned. It's simple: brokers sell shares in a company without borrowing them first. In other words, they sell shares that don't actually exist!

What a great scam! Collect $millions of dollars by selling shares you created out of thin air! This drives the price down, allowing you to buy those shares back for less money than you collected.

And it's all perfectly legal so long as you do it in less than three business days.

http://www.deepimpact.com

Mitesh Damania said...

A lot of the public are small Madoffs in their own right.

Anonymous said...

SKF is now a great buy!

Anonymous said...

SKF and FAZ may still have some opportunity after the banksters drive up share prices of their own stocks, so they can bail out of them. See Citibank for how many executives were buying C at 5, 6, and 7 dollars a share. Now get a quick pump and dump that dogshit. Wells Fargo making money in Q1 has to be a bigger pile of BS than SKF/FAZ.

Naked shorting seems to be just fine with the SEC (it's supposed to be illegal) as long as you are not naked shorting the 19 "special" banks.

Anonymous said...

well keith, its like you said. you have to trade, and you can't be a perma bear, or a perma bull, you have to trade the tape you have. therefore, i am sure they have faded their short positions a long time ago, to adjust for the squeeze.

Anonymous said...

You know you can short SKF too if you wanted to....It is actually not a terrible idea because of how it responds to volatility. All I know if that I have juiced my returns trading it. Don't hate the player yada yada,

keith said...

Don't get me wrong - watching SKF is like watching UFC. You can't look away.

But it's helped hedge funds manipulate the market and get around regulations of naked shorting. It should NEVER have been approved by the SEC. But hey, under Chris Cox, anything goes.

WizardofIB said...

Keith,

I would be more worried about other stocks vice an UltraShort used to generate positive cash flows in an otherwise trashed market. Stocks you might consider looking at for immoral activity include:
BAC
WFC
C
GS
MS
F
GM
AIG
LEHMQ
GMAC

Just a thought..

soft landing said...

Any of the Ultra ETFs are strictly trading vehicles. They reset daily and erode in value over time. When looking to buy them one needs to use the underlying index for any technical analysis, not the ETF's chart. The best bet is to Short the Ultra Shorts, you gain from the inherent price erosion.

Anonymous said...

Until widespread arrests of GS and JPM employees and *alumni* take place, the rigged casino action will continue.

Is there some unwritten rule for Attorney General Holder to only allow *selective prosecution* for fraud?

Who the hell is pulling his strings??