The inverse Cramer ETF lost 15% after a year and got shut down. Being wrong on the stock market does not mean that someone doing the opposite is right. Just like in software dev, there are infintely many ways to be wrong and by comparison only very few to be right.
I was just humorously insinuating that HN generally isn’t particularly good at financial advice. Take this top comment from 2022, simultaneously bearish on both crypto and AI... https://news.ycombinator.com/item?id=34196161
There's no "opposite" when the decision space is very wide and with time as a factor. There's many "opposites" to choose from when you want to do "not what the guy did", so in the end it was just a "we promise to do anything except what Cramer says" rather than opposite.
There’s still a clear opposite for many predictions. If someone says he’s betting on stock X, the opposite would be to go short. And if someone says the stock is overpriced, you buy it.
If someone says he's betting on stock X, the opposite is not to go short. That's one way of doing "not what he did". Another way of doing "not what he did" is to for example sell a PUT, because maybe you think it's just going to stay flat. Another way is to not do anything, and instead wait, because going short costs money (you're borrowing a stock and borrowing fees on it), and so the act of shorting itself can lose you money if he isn't "wrong fast enough". So is the opposite to short it on the day he says he's buying, or is the opposite to short it the next week? Even "pure opposite" situations would require exact entrypoints and exit points which you wouldn't have.
You literally fell for the exact thing I was describing.
Isn’t selling puts „going short“? I understand „going short“ as „betting the stock is going down“, not literally selling shorts. But I’m also not a daytrader, so I’m not clear on the words used.
And not doing anything clearly isn’t the opposite. If someone says he’s going North, what’s the opposite of that? It would be going south, even though you could go west or east too, or just do nothing. Just because it’s a spectrum with more than one dimension doesn’t mean that some actions don’t have an opposite action.
You make the most money on a PUT you sold if it stays above strike, it doesn't have to go up at all for you to make 100% of the possible profit of the trade. You just wait as it goes to zero. The example was to show how to profit off of something staying flat.
Selling puts is a volatility bet mostly, but can be seen as bullish like buying stock, but doesn’t just behave as up=good, so your understanding is not up to par yet for this example. This is literally the issue.
How is that the issue? Even then, if someone’s position is „this stock is going up“, betting on „this stock is going down“ is the opposite. How you’re doing that is an implementation detail. You can even go to a Bookie and make a bet about the stock if you want to, the point is inverting the prediction. The issue is whether there’s a clear inverse, which I would argue there is.
You can invert specific positions with specific timings, you cannot invert statements from a show because implementation details as you call them will be paramount to performance. There's plenty of "reverse" ETFs that last a long time and aren't meme money grabs that do just that. The problem is in the interpretation of what "opposite cramer" means. If Cramer says something goes up, but it stays flat, going short will also lose money, selling PUTs as I described would make money - which strategy is "the opposite" of what he said? Both are other things that can happen that aren't what he said. And there's way more things that can happen.
How did Cramer do in the same time frame? What about the S&P 500?
They don't actually have to be positive every year. They just have to do better than comparable indexes. It's hard to tell the value of a strategy after just one year.
