shorting the Dow

[rentose]

I would like to know, if one wants to short the Dow long term what are the best options?

I realise one can sell the dow through spreadbetting but that seems to be very short term, and theres a charge for holding positions overnight. I dont know if these charges are big enough to offset or damage any profits you may make but I suspect they are.

So if your view was say 3 months to a year for the Dow, what other options to sell it would you have?

Thanks!!

 

[chindl]

If you short the daily Dow with a bookie on a rolling contract you should actually benefit from interest payments made to you at their close each day. All the rest will be the cost of the spread, Fins rolling contracts are 24 hrs on a 4 pt spread. Can't comment on D4F.
Chris

 

[roguetrader]

I would like to know, if one wants to short the Dow long term what are the best options?

I realise one can sell the dow through spreadbetting but that seems to be very short term, and theres a charge for holding positions overnight. I dont know if these charges are big enough to offset or damage any profits you may make but I suspect they are.

So if your view was say 3 months to a year for the Dow, what other options to sell it would you have?

Thanks!!

The way in which you word your question makes it sound like a bit of a one off event, and as such it's probably not worth exploring any other avenues as they would be too much hassle to set up.
But to answer the very last part of your qustion, if you had an appropriate account you could sell the Dow futures contract, or you could sell the Dow etf, or you could purchase put options on the etf, there will always be a cost invilved one way or another.

 

[rentose]

More of a long term dow view:

The way in which you word your question makes it sound like a bit of a one off event, and as such it's probably not worth exploring any other avenues as they would be too much hassle to set up

In essence its a long term view of the dow, maybe a year. But it seems hard to find an instrument to take advantage of it. Whats a ballpark figure of how much youd losein the following situation:

Sell dow today on a spreadbet or cfd (if there is one) at 11000pts
Buy Dow 1 year from now at 11000pts (i know it makes no sense,its an example)

Lets assume you didnt lose anything on the spread. If the first bet cost you £10000 and closing out the bet got you your £10000 back, how much would you have lost through (Im not sure if they call it this) 'holding charges, or interest or whatever?

I realise I should try to work this out myself,but if anyone has the answer to hand or can work it out quicker than me I'd appreciate it.

Thanks! :-0

 

[roguetrader]

I don't spreadbet so I can't help with this. if you sold the ETF you would have margin to pay, but it really wouldn't be worth setting up a brokerage account just to sell the Dow now and buy it back in a year, spreadbetting probably is your best way to go, so I will leave that to someone else to answer