Recession Imminent

by chaney3

Introducing the newest brand of full-blown autism™, I present to you the California / Europe ultimate bear portfolio! Based on a special blend of my extra chromosomes and a spicy mix of hate for California, this portfolio will blow average market returns out of the water based on the following assumptions (Cetaris Paribus):

  1. The world will enter a large economic recession within the next 12 months.
  2. Many Currency values will fall relative to others, however the Euro will be hit among the hardest.
  3. As unprofitable companies no longer have access to liquid credit or financing they will have to restructure their debt in some form.
  4. The highest density of unprofitable companies will continue to exist in California, and local California municipalities will not plan accordingly for a recession.
  5. European markets in general will fall quicker and with more momentum than US equity markets.

Feedback and thoughts requested please.

Symbol & Exchange Description Instrument Position Strategy Allocation (%)
CHF/EUR FOREX ICE Swiss Frank vs Euro Currency Pair Currency Pair Long 10
6EH2021 CME Euro Futures March 2021 Futures Contract Short 10
FXE NYSEARCA Invesco Currency Shares Euro Currency ETF ETF 15JAN 2021 $98 Strike Put Contract Long 10
GBP/EUR FOREX ICE Pound Sterling vs Euro Currency Pair Currency Pair Long 15
USD/EUR FOREX ICE U.S. Dollar vs Euro Currency Pair Currency Pair Long 5
CMF NYSEARCA California Municipal Bond ETF ETF Short 5
PZA NYSEARCA Invesco Nation AMT-Free Muni Bond ETF ETF Short 5
AUD/USD FOREX OANDA Australian Dollar vs U.S. Dollar Currency Pair Currency Pair Long 5
EZU BATS iShares MSCI Eurozone ETF ETF 15MAY2020 $37 Strike Put Contract Long 15
GDX NYSEARCA VanEck Vectors Gold Miners ETF ETF 15JAN2021 $35 Strike Call Contract Long 20

Edit: Typo, wrote put instead of call for GDX. Shame tables don’t copy over from word / excel and you have to retype yourself.

 

Disclaimer: Consult your financial professional before making any investment decision.

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