I went long on SDS this morning, which is an ultrashort of the S&P 500. So far so good. I got in when the S&P was up about 10 points, believing that the market would have a difficult time holding on to the early gains, especially when considering recent difficulty for the general markets to breakout to new highs. My entry was 37.55 while my stop-loss is at 36.49, so I’m working with a very tight stop-loss while only exposing about 0.5% of my portfolio to potential losses.
This was an ideal setup, as I am using all-time lows, achieved earlier this month as my signal to get out of the trade (the stop-loss), while being able to commit about 17% of my portfolio to the trade while only risking 0.5% of my total portfolio value.
Here’s the chart on SDS…
