15 March 2016

Long or Short

In an economy "downturn" while shares price are going down, a lot of peoples will ask the same question "how can we make money in an economic downturn?"

Most of the investors only know how to buy shares (long on shares), however when one anticipate that the market is heading south, shouldn't shorting the market be the strategy?

Personally, I adopt a long positron 80-90% of the time and only short the market 10-20% of the time.

Why is that so?

If you have observed the financial market long enough, you would notice that most of the time when market is heading south, it is a fast and short event (usually doesn't last for more than a year). So typically I would adopt a "short" strategy to go along with the falling knife and once the knife had fallen to the ground, I would immediately adopt a "long strategy"

Please do share your views in the comments box below. Thanks!