Realist said:Why on earth short RIO and ZFX?
RIO is more of a pure minerals (i.e. no major oil/gas interests) play than BHP, so would theoretically be more susceptable to a global downturn in demand. RIO may have secured iron ore price increases, but they still need buyers to move product. If the global economy slows, China's need for input materials slows, RIO sells less than expected. Same goes for ZFX, assuming steel production slows.Realist said:Why on earth short RIO and ZFX?
lewstherin said:RIO is more of a pure minerals (i.e. no major oil/gas interests) play than BHP, so would theoretically be more susceptable to a global downturn in demand. RIO may have secured iron ore price increases, but they still need buyers to move product. If the global economy slows, China's need for input materials slows, RIO sells less than expected. Same goes for ZFX, assuming steel production slows.
BHP is at least cushioned to an extent by oil, gas and uranium.
Hello Wayne,wayneL said:I'm hoping for some inside days and a brief rally based on the positions I have. But it's all eyes on Israel (WTF are those people thinking?) and the Middle East.. oil, AND interest rate fears.
But where's all the socionomics followers? I thought all the Prochterites would be coming out being very smug.
Look at the social mood FFS!!! Wars, inflation fears, fear of terrorism, personal freedoms inexorably stripped away, bird flu, house prices on the verge of collapse, ludicrous personal debt/personal bankruptcies skyrocketing, young people worried about ever owning a house, extreme polarization in politics etc etc.
The social mood is lousy folks. We in bear territory here.
Cheers
Magdoran said:The biggest problem we face besides hostilities is the impact of Crude oil peaking, and the potential for the full weight of economic structural adjustment depending on when the production tapers off, and how fast.
not wanting to sound like a pessimist
wayneL said:Because when folks realise that the China economy still relies on USA, they will dump.
Realist said:How long can you short it for? It may take a while for folks to realise this, like years.
Actually here's a question...
What if you short a stock and it payed out a 4% dividend and the price drops 4% accordingly - how does that affect your short position. who gets the dividend?
Agreed there WayneL. IMO markets make the news, not the reverse.wayneL said:It's just exposed a structurally weak market, that's why a hit was fairly predictable. All it needed was a trigger, any trigger.
If the market was confident the ME would be ignored.
Cheers
Interestingly, as any options trader will know, people like Wayne and I can actually make money if the market just goes sideways or down if we use a credit position, like selling a call (but suggest using a hedged strategy like a bear call spread or maybe a ratio version to limit risk rather than go “naked”) to take advantage of a bearish/sideways market.wayneL said:A person who is short physical shares must borrow those shares from the broker.
Therefore the person who is short the shares must pay the dividend to the owner of the shares.
visual said:unfortunately doesnt look like anyone in the DOW is reading the papers.
wayneL said:I guess they decided to do something really different and read their balance sheets
: :
michael_selway said:Wayne ithink u are a happy bear!
CAnt believe this guy below might be right
http://www.depression2007.com/contact.htm
thx
MS
visual said:Looks like Israel is already talking cease fire,lets hope so,
swingstar said:
wayneL said:LOL How could I forget that one.
[toungue in cheek rant] In our society we have been trained by american (or amaricanized) motivational speakers to reject any sort of "pessimism" as an apostasy. Consequently lots of folks don't want to see the risks.
Folks who know I'm a trader often ask my view of the market. Earlier this year I said, expect a correction and expect it to be substantial, when, I don't know, but expect it at some stage.
I was shunned as a neg-head and a traitor to the australian (american) way, told I was nuts, what about china, india.... I've just sunk $400,000 of borrowed money into the market! It's going UP goddammit!!! Understand!!!!
So yes, don't sound like a pessimist fer gawds sake!![/toungue in cheek rant]
: Cheers
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