Hedge funds also favour derivatives such as forwards, futures, swaps, and options above forex and simple equities. In 2008, it had to do with vehicles associated with real estate and people defaulting on their loans. CDOs and credit default swaps were (and likely still are) highly popular.
If there is a way to short the Chinese real estate market, that would be favourable. It's a clusterfuck over there, they have literally built cities of buildings that are ghost towns, in which many people own the property, yet have nobody living in them. The thought is that "real estate always appreciates in value" is going to hurt a lot of people.
I've been thinking for some time about shorting their currency, however, the United States is not much better off right now, and I can't institute an "insurance policy" on a currency nearly as easily as I could on an equity. Depending on what happens this week, I will likely look to short selective equities, while insuring them with out of the money calls just in case there is a rally. If this truly is a bear market, I would look to selling calls as well. Build up that margin account, it is likely the only way to make money in this market over the next while.
If there is a way to short the Chinese real estate market, that would be favourable. It's a clusterfuck over there, they have literally built cities of buildings that are ghost towns, in which many people own the property, yet have nobody living in them. The thought is that "real estate always appreciates in value" is going to hurt a lot of people.
I've been thinking for some time about shorting their currency, however, the United States is not much better off right now, and I can't institute an "insurance policy" on a currency nearly as easily as I could on an equity. Depending on what happens this week, I will likely look to short selective equities, while insuring them with out of the money calls just in case there is a rally. If this truly is a bear market, I would look to selling calls as well. Build up that margin account, it is likely the only way to make money in this market over the next while.
"Money over bitches, nigga stick to the script." - Jay-Z
They gonna love me for my ambition.