What to Buy, What to Sell? (SPY, SH)
Will the Dow Jones and S&P 500 continue to charge higher? No one knows. Anyone who tells you otherwise is full of mierda. Instead of stock picking, how about playing the major indexes long via the SPDR S&P 500 ETF Trust (SPY) and short using the ProShares Short S&P500 (ETF) (SH).
The tickers and weapons of choice for investing this late in the bull rally are SPY and SH. We recommend not stock picking but just buying the damn indexes with these coveted ETFs. At the moment it appears that stocks as a whole can do no wrong, thus the SPY makes perfect sense. Its traded between $127.14 and today's new 52-week high of $156.79. Thus far in 2013 the SPY is up 10%. If your portfolio is not up 10%+ then stop trading and just buy this damn basket of the SPDR S&P 500 ETF Trust (SPY).
The SPY is a direct reflection of the S&P 500 Index. It corresponds to the price and yield performance of the S&P 500 Index. The S&P 500 Index is composed of 500 selected stocks and spans over 24 separate industry groups. The Fund’s investment sectors include information technology, financials, energy, health care, consumer staples, industrials, consumer discretionary, materials, utilities and telecommunication services.
Should the market start to tank, then take sell the SPY and buy the ProShares Short S&P500 (SH). The SH is the exact opposite of the SPY. The ProShares Short S&P500 (SH) shares have traded between today's new 12 month low of $30.78 and $39.37 over the past 12 months.
Do yourself a favor and turn off CNBC and Bloomberg. Stop reading and trying to figure out which stock and sector is going to play catch up to the major indexes. Why bother?
The SPY is up 10% and we have yet to close out Q1 2013. Like we said before, if you are not up 10% in your book -- stop trading and sell everything. Until you catch up with the Dow and S&P 500 play the SPY and if the market starts to correct itself jump into the SH. Stop risking your IRA and life savings. The SH and SPY aren't big movers and provide a refreshing view of the market without massive volatility.
Need more investing ideas? We have the equities that you should be watching and considering all spelled in the following publications this week, enjoy:
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