How to win with a bear market, the brexit example



How to make money in a bear market? Although the Greek crisis or the brexit or the Asian crisis, these strategies that I deliver you traded work well. A good financial indeed made money market drops or rises, I tells you how in this article.

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Buy securities of UK debt on the secondary market if it is sold less than its face value maturity and which reported higher rates of interest.

Caution still can lose made England failure.

Way as method

VAD (short sale)

If you have a trading account, the principle is simple you place a sell order via your broker then you redeem your sale and pocketing your added value, only this is the downside of the VAD is that you can not make a 100% performance, use only in a nasty bear market

Speculating in the opposite direction on the devaluation of British debt on the secondary market. This is what is called take a position "short".

Explanation of the mechanics, example to support, given recently by the English Economist Robert Skydelsky. I take an appropriation of EUR 10 million in State bonds, which are then traded on 0, 91euro for six months. To do this, I have to pay to the Bank around 5% per year to this price, or about 2.5 per cent, or € 250,000 for six months. I immediately sell these bonds on the market, to 0.91 euros, I perceive so 9.1 million euros (€0.91 x €10 million in nominal value). I have therefore already sold something and touched my money for a while I have to deliver later.

At the date to which I am supposed to deliver obligations, the obligation is negotiable only around 0.72 euro because the market declined.

So I get on the market, I buy 10 million euros to a nominal value of 0.72 euros, or 7.2 million euros, and I deliver certificates of obligations as agreed.

My earnings for having bet on a bearish trend is therefore of 1.65 million euros – the 9.1 million euros that I collected through the sale of borrowed bonds, less the 7.2 million euros that I had to pay to redeem them later, less the 250,000 euros of interest that I had to pay the Bank for six months.

However if finally the obligation rises in value, I loss. Attention, to do this, that questioning of your account opening title in a Bank, by default the average investor going not be entitled to a loan to use this system, you must fill the document as a professional, more if I have good memory be careful of margin calls.

It is the term for the payment during the contract of a complement of deposit linked to the depreciation or appreciation of the contract and the underlying asset to this contract.

To do so in the case of a market really very bearish

Speculate on cds

Speculate with "CDS" on British debt which are insurance playing fault concerned debt (in the jargon spoken of credit payment of insurance trigger event).

There are two ways to earn money on the CDS of a debt: when the trigger (i.e., the finding of defect) event occurs.

Or resell the CDS at a price higher than the purchase price. This is the case for example if you bought CDS at the beginning of the British crisis or the owners of British crisis manage to raise the price of the insurance premium for example by running noise while the country goes straight to the disaster.

This is more of the diversion of product that other thing.

Third solution, picks it up (the simplest) stew.

Admit that the panic market, that a crisis occurs, during a few months the price of all the shares and fund collapses and you can then redeem these funds at low prices.

There is an old blog that I followed it y long which exemplifies this philosophy,

This method illustrates the method of two barriers.

CAC values

A reverse or "bearish" tracker

What is a tracker?

A tracker is a fund that replicates the performance of an index and which is listed on the stock exchange. It is reduced to a division of close to 1: 100 index so that it can be easily accessible to consumers. The CAC40 index gains 3%, the tracker on the CAC40 earns 3%.

With only €1000, the investor can hold all of the securities that compose the cac40 index or other stock index.

The trackers are issued by financial institutions that ensure the holding of the market, always present for sale as to the purchase.

As an investor, it is now easier to buy and sell a tracker action. They are rated continuously and are very liquid, volumes are concentrated on the trackers replicating changes in indices leading each of the fellowships.

What is a reverse or "bearish" tracker?

All products included in the table below respond to the inverse of the progression of the index. When the cac40 index loses 3%, the bear tracker earns 3%.

While the choice is immense to find trackers following the upward evolution of an index, it is low to find and enjoy it in a downward trend. This means a much limited selection so.

Interesting solution.


Several methods exist, otherwise if it does you not attempt too much, I advise you to use the platforms at fixed rate as


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