Saturday, September 6, 2008

My Pair Trade That Never Was

How about being short FRE and FNM and long XLF going into the weekend? It looks like the government wants to pour our tax dollars down the shoot again. The two f's are probably headed to zero and according to aftermarket prices the financials are up strongly on this news. If the financials get silly on Monday, my inclination would be to short the rally.


Anonymous said...

Why would you short a financial rally?

upsidetrader said...

because i think this bailout of fnm and fre is the beginning of more bad things to come-the financials could get a relief rally(short squeeze) monday, tuesday but i then think it's back to business-without subprime and M&A, BANKS AND BROKERS HAVE no PROFITABLE REVENUE MODEL ANYMORE AND IT WILL TAKE YEARS FOR THEM TO REINVENT ThEMSELVES-JUST MY OPINION-THEY COULD RALLY FOR A COUPLE OF DAYS THOUGH

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I am a former hedge fund manager, broker and capital markets dude who now trades for his own account. I love what I do. I will try to post some stocks and an occasional chart that looks attractive for entry.I will also try to point out the idiocy of conventional wisdom and the lack of value added by the mainstream financial media. These postings should not be viewed as recommendations.