Today we saw significant selling in the major indices. If you read my previous posts, you see that this comes as no surprise to me. This is why I urge people to 1) buy only the safest of blue chip stocks, and 2) protect their long positions by selling calls and buying puts (or bear market etf's). Part 2 of this defensive strategy (the option spread of selling calls and buying puts) is called a "synthetic short" position. It allows the investor to take a neutral position, long and short (synthetically) simultaneously, and collect dividends from the blue chips utilized in this strategy.
The S&P remains around the $1,000 price. Patient players may just get a shot at attractive entry points between now and Christmas. Personally, this is what I anticipate!
as always, good trading.
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