I’m very concerned that some private investors who read a lot of bearish blogs will do some emotional things, go heavy short and burn their ass out. As I’ve posted a lot of very bearish stuff, I feel myself uneasy that I am partially responsible to expose some folks to danger.
I want to offer you a relatively safe bear play that I consider very profitable if things go bad but will lose next to nothing if things go good.
You need to go long energy stocks and on equal amount short semiconductors. Use ETFs. For shorting semiconductors use SSG inverse ETF. For energy pick some ETF that contains all major oil and gas players.
The semiconductors capacity utilization is at 71% capacity now, this is horrible, they must drop like a stone. But this market is crazy, they can easily go up another 5%, so that’s where energy stocks will offset your losses. Don’t worry, they are not falling off the cliff anytime soon. Just remember – never go bearish in bullish market, it will cost you. But you can always go 50/50%, to feel good.