As the stock market loses strength here and has problems moving higher I have increased my positions in both the Horizon Nasdaq bear ETF (HQD.TO) and the Horizon S&P bear ETF (HSD.TO). The Nasdaq index has had problems breaking above 2800 and the S&P has no ooomph to get past 1340 and it is stays like this for another month then I think we are going down.
Now, I may very well be wrong and the Nasdaq and S&P can rally from here to slightly higher, but there isn’t really a whole lot of economics statistics to support that, however with the stock markets you never know. In the short term a bump up could be possible, but my prediction is that by the end of June 2011 the U.S stock markets will take a sharp direction downward and that within 2 years it will hit similar lows of that seen in 2008.
Remember to stay out of U.S dollar base trades, so that is why I have purchased these bear ETFs on the Toronto Stock Exchange and NOT any bear ETFs on the U.S markets. The reason here is simple, as the U.S dollar is being devalued it is worth less and less, so when you do sell these ETFs for a profit, your profit as a Canadian can be eaten away by the devalued U.S currency. So, if you are Canadian I suggest you stick to what is available on the Toronto Exchange hence this 2 bear ETFs that I am writing about.
by Das Brain
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