Well, I previously said I was giving up on a welcome rally. Now I’m reversing my position (again!). I moved back to perfectly hedged today. I sold my March SPY puts. When I move back to bearish, I’ll be buying June SPY puts. Given how fast and how much the market has declined recently, I would not be surprised if the market rallied 10% or more from here. Right now, the futures are moderately up. As before, I think the risks are to the downside, so instead of trading for the upside, I’ll buy puts after the rally takes the S&P to 850 and more at 900. If anyone does trade for a rally, please use protective stops.
As usual, if you have a 10 year or more investing horizon, now’s a fine time to pick up some index ETF shares. I do think we’ll have a bigger sale in the relatively near future, though. Perhaps you should look into covered calls.
