what if I told you that the stock market was going to crash sometime

I'd tell you that I've heard all that before for any given year, and your well timed trades require either a crystal ball or the luck of the gods.

>>1922599
never understood how you can profit on crashes

>>1922609
Bro you haven't even paid for his 8 easy signs that the market is crashing, maybe hear him out?

>>1922614
Shorting and the various derivatives that amount to shorting (e.g. put options).

>>1922616
Nope. I'm not trying to sell or advertise anything nor do I ever intend to. I'm just curious to see people's interest.

>>1922622
sitting in my boxers with nothing better to do for a few hours, shoot my man

>>1922619
but that's relying on other people wanting to buy, right?

>>1922638
Not really. Short selling works by selling while prices are still high and then buying once they are low. Derivatives like put options give you a contractual right to sell, whether the counterparty wants to buy or not.

>>1922616
can i have a tour of his Beverly hills mansion and Lamborghinis first?

>>1922645
I think I get it.
Are there any other standard means of profiting from this?
I mean something along the lines of:
Let's say you know price of meat will plummet (due to a scare maybe?), and as a result, price of veg will go up. Meat farms will also be closing down, freeing cheap workers.
you know you should either build veg farms, or buy stock in them at least.
That's how I assumed most people would profit from crashes.

>>1922676
The basic positions are long and short. You short if you think prices are going to go down and you go long if you think the prices are going to go up. Ideally, you would short on the way down and then go long on the way back up.

With your specific example, you could go long stock in farms, or you could trade futures contracts for the affected commodities (e.g. corn, wheat). Similarly, you could short stock in ranches, or you could trade futures contracts for the affected commodities (e.g. hogs, cattle).

The thing to keep in mind with a market crash though is that things are going down overall. The things that go up are hedges against the market like gold.

>>1922599
VIX calls right my nigga? Hard part is timing it and remaining solvent

>>1922752
Kelly criterion

>>1922753
only works if you know the odds of your bet

>>1922599
Closer to 2018 than 2020, really, which will be fun for the people who think Trump is going to bring them back my jobs.
But I want to hear this.

>>1922599

I believe you, I know it's possible, but you're giving me a 36 month window, for a strategy, that uses options, which have a 12 month expiry, which gives me what, a 1 in 3 chance of success?

Not bad odds, but you can do better, work out how to get the window down to 18 months, heck even 12, that way you can go balls deep on a concentrated bet and Christian Bale can play you in a movie :P.

>>1922762
>>1922811

Nah, 12 month options are too expensive. My plan is to buy up 3 - 6 month OTM put options sequentially on specific dates based on my model at around 25 - 50 leverage. My strategy has a high failure rate because those high volatility events are actually quite rare, but the actual losses of my strategy will be chump change. Maximum losses are going to be $1000 a year (most I can tolerate with my current capital), but when it hits, the profits will be gigantic.

My current model gives these performances::
>% positive returns 16.33%
>% negative returns 83.67%
>average positive returns 5033%
>average negative returns -100% (because option trades expire worthless if they're wrong)
>P/L Ratio 12.50

Because my trades would be like 1 or 3 times a year, I'm thinking of sharing the dates of my trade with those few who would be interested here on /biz/. Not sure how to do this...do you guys prefer discord, skype or just want me to create threads here on /biz/?

listen anon, i want to build alife first, sure MAYBE a good detoriation in the financial x-change but listen anon another global death? anaon you must not wish this, just you wait until africa picks up and brazil, theyll be leading the world makrets like no other.

>>1922599
I would tell you that we had these threads monthly since /biz started in 2014

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>>1923290
>>1923293

yeah...yeah I guess you're right. I just backtested my model before 1990 and it completely breaks down. guess you really can't beat the market in the long run...


back to the drawing board I guess...

>>1922599

What makes you think it is not going to happen in 2017?

>>1922869
discord would be convenient

What ACTUAL event are you riding on to bring about the crash? I understand your idea but what do you expect to happen that's going to lead to the shitshow?

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>>1923318
>>1923412
>>1923496

never mind. my brilliant strategy failed. >>1923316

>>1923496
The fed interest rate hikes aren't really priced into stocks yet. And there's been quite a big bull market these past couple of months. It's bunch of downward pressure building up. I doubt it'll be a crash though

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Honestly I would bet on 2018 for the crash as soon as the democrats regain control of the senate.

By that time we will see the effects of the interest rate going up, and policy changes will screech to a halt due to democrats cockblocking new measures.


This stalls the economy.

>>1923548
>>>1923496
>The fed interest rate hikes aren't really priced into stocks yet.

Because the entire US market is betting on trump cutting taxes and regulations across the board

If he doesn't deliver there will be a crash

>>1922869

Which options are you buying? I own some May 19 DIA puts right now.