SPDN: An Inexpensive Way To Profit When The S&P 500 Falls

Summary
SPDN is not the largest or oldest way to short the S&P 500, but it’s a solid choice.
This ETF uses a variety of financial instruments to target a return opposite that of the S&P 500 Index.
SPDN’s 0.49% Expense Ratio is nearly half that of the larger, longer-tenured -1x Inverse S&P 500 ETF.
Details aside, the potential continuation of the equity bear market makes single-inverse ETFs an investment segment investor should be familiar with.
We rate SPDN a Strong Buy because we believe the risks of a continued bear market greatly outweigh the possibility of a quick return to a bull market.
Put a gear stick into R position, (Reverse).
Birdlkportfolio

By Rob Isbitts

Summary
The S&P 500 is in a bear market, and we don’t see a quick-fix. Many investors assume the only way to navigate a potentially long-term bear market is to hide in cash, day-trade or “just hang in there” while the bear takes their retirement nest egg.

The Direxion Daily S&P 500® Bear 1X ETF (NYSEARCA:SPDN) is one of a class of single-inverse ETFs that allow investors to profit from down moves in the stock market.

SPDN is an unleveraged, liquid, low-cost way to either try to hedge an equity portfolio, profit from a decline in the S&P 500, or both. We rate it a Strong Buy, given our concern about the intermediate-term outlook for the global equity market.

Strategy
SPDN keeps it simple. If the S&P 500 goes up by X%, it should go down by X%. The opposite is also expected.

Proprietary ETF Grades
Offense/Defense: Defense

Segment: Inverse Equity

Sub-Segment: Inverse S&P 500

Correlation (vs. S&P 500): Very High (inverse)

Expected Volatility (vs. S&P 500): Similar (but opposite)

Holding Analysis
SPDN does not rely on shorting individual stocks in the S&P 500. Instead, the managers typically use a combination of futures, swaps and other derivative instruments to create a portfolio that consistently aims to deliver the opposite of what the S&P 500 does.

Strengths
SPDN is a fairly “no-frills” way to do what many investors probably wished they could do during the first 9 months of 2022 and in past bear markets: find something that goes up when the “market” goes down. After all, bonds are not the answer they used to be, commodities like gold have, shall we say, lost their luster. And moving to cash creates the issue of making two correct timing decisions, when to get in and when to get out. SPDN and its single-inverse ETF brethren offer a liquid tool to use in a variety of ways, depending on what a particular investor wants to achieve.

Weaknesses
The weakness of any inverse ETF is that it does the opposite of what the market does, when the market goes up. So, even in bear markets when the broader market trend is down, sharp bear market rallies (or any rallies for that matter) in the S&P 500 will cause SPDN to drop as much as the market goes up.

Opportunities
While inverse ETFs have a reputation in some circles as nothing more than day-trading vehicles, our own experience with them is, pardon the pun, exactly the opposite! We encourage investors to try to better-understand single inverse ETFs like SPDN. While traders tend to gravitate to leveraged inverse ETFs (which actually are day-trading tools), we believe that in an extended bear market, SPDN and its ilk could be a game-saver for many portfolios.

Threats
SPDN and most other single inverse ETFs are vulnerable to a sustained rise in the price of the index it aims to deliver the inverse of. But that threat of loss in a rising market means that when an investor considers SPDN, they should also have a game plan for how and when they will deploy this unique portfolio weapon.

Proprietary Technical Ratings
Short-Term Rating (next 3 months): Strong Buy

Long-Term Rating (next 12 months): Buy

Conclusions
ETF Quality Opinion
SPDN does what it aims to do, and has done so for over 6 years now. For a while, it was largely-ignored, given the existence of a similar ETF that has been around much longer. But the more tenured SPDN has become, the more attractive it looks as an alternative.

ETF Investment Opinion

SPDN is rated Strong Buy because the S&P 500 continues to look as vulnerable to further decline. And, while the market bottomed in mid-June, rallied, then waffled since that time, our proprietary macro market indicators all point to much greater risk of a major decline from this level than a fast return to bull market glory. Thus, SPDN is at best a way to exploit and attack the bear, and at worst a hedge on an otherwise equity-laden portfolio.

What Are The Greatest Changes In Shopping In Your Lifetime

What are the greatest changes in shopping in your lifetime? So asked my 9 year old grandson.

As I thought of the question the local Green Grocer came to mind. Because that is what the greatest change in shopping in my lifetime is.

That was the first place to start with the question of what are the greatest changes in shopping in your lifetime.

Our local green grocer was the most important change in shopping in my lifetime. Beside him was our butcher, a hairdresser and a chemist.

Looking back, we were well catered for as we had quite a few in our suburb. And yes, the greatest changes in shopping in my lifetime were with the small family owned businesses.

Entertainment While Shopping Has Changed
Buying butter was an entertainment in itself.
My sister and I often had to go to a favourite family grocer close by. We were always polite as we asked for a pound or two of butter and other small items.

Out came a big block of wet butter wrapped in grease-proof paper. Brought from the back of the shop, placed on a huge counter top and included two grooved pates.

That was a big change in our shopping in my lifetime… you don’t come across butter bashing nowadays.

Our old friendly Mr. Mahon with the moustache, would cut a square of butter. Lift it to another piece of greaseproof paper with his pates. On it went to the weighing scales, a bit sliced off or added here and there.

Our old grocer would then bash it with gusto, turning it over and over. Upside down and sideways it went, so that it had grooves from the pates, splashes going everywhere, including our faces.

My sister and I thought this was great fun and it always cracked us up. We loved it, as we loved Mahon’s, on the corner, our very favourite grocery shop.

Grocery Shopping
Further afield, we often had to go to another of my mother’s favourite, not so local, green grocer’s. Mr. McKessie, ( spelt phonetically) would take our list, gather the groceries and put them all in a big cardboard box.

And because we were good customers he always delivered them to our house free of charge. But he wasn’t nearly as much fun as old Mr. Mahon. Even so, he was a nice man.

All Things Fresh
So there were very many common services such as home deliveries like:

• Farm eggs

• Fresh vegetables

• Cow’s milk

• Freshly baked bread

• Coal for our open fires

Delivery Services
A man used to come to our house a couple of times a week with farm fresh eggs.

Another used to come every day with fresh vegetables, although my father loved growing his own.

Our milk, topped with beautiful cream, was delivered to our doorstep every single morning.

Unbelievably, come think of it now, our bread came to us in a huge van driven by our “bread-man” named Jerry who became a family friend.

My parents always invited Jerry and his wife to their parties, and there were many during the summer months. Kids and adults all thoroughly enjoyed these times. Alcohol was never included, my parents were teetotallers. Lemonade was a treat, with home made sandwiches and cakes.

The coal-man was another who delivered bags of coal for our open fires. I can still see his sooty face under his tweed cap but I can’t remember his name. We knew them all by name but most of them escape me now.

Mr. Higgins, a service man from the Hoover Company always came to our house to replace our old vacuum cleaner with an updated model.

Our insurance company even sent a man to collect the weekly premium.

People then only paid for their shopping with cash. This in itself has been a huge change in shopping in my lifetime.

In some department stores there was a system whereby the money from the cash registers was transported in a small cylinder on a moving wire track to the central office.

Some Of The Bigger Changes
Some of the bigger changes in shopping were the opening of supermarkets.

• Supermarkets replaced many individual smaller grocery shops. Cash and bank cheques have given way to credit and key cards.

• Internet shopping… the latest trend, but in many minds, doing more harm, to book shops.

• Not many written shopping lists, because mobile phones have taken over.

On a more optimistic note, I hear that book shops are popular again after a decline.

Personal Service Has Most Definitely Changed
So, no one really has to leave home, to purchase almost anything, technology makes it so easy to do online.
And we have a much bigger range of products now, to choose from, and credit cards have given us the greatest ease of payment.

We have longer shopping hours, and weekend shopping. But we have lost the personal service that we oldies had taken for granted and also appreciated.

Because of their frenetic lifestyles, I have heard people say they find shopping very stressful, that is grocery shopping. I’m sure it is when you have to dash home and cook dinner after a days work. I often think there has to be a better, less stressful way.

My mother had the best of both worlds, in the services she had at her disposal. With a full time job looking after 9 people, 7 children plus her and my dad, she was very lucky. Lucky too that she did not have 2 jobs.

Increase Fat Loss by Nutritional Journaling

Fat loss continues to be one of the most popular topics in health and fitness and people are always looking for new ways to lose weight and improve the way they look. Companies are always promoting new and often untested products such as pills, powders, creams, exercise equipment, and diets to promote fat loss, but the vast majority of these things are marketing gimmicks that are rarely as effective as previously established methods for losing fat. One such proven method for increasing fat loss that often goes overlooked is nutritional journaling.If you are unfamiliar with the concept of nutritional journaling, it is basically just writing down what you eat and drink throughout the day, although there are many different ways to go about keeping a nutrition journal. A journal can be very thorough or much more simplistic, but keeping virtually any type of nutrition journal should increase the amount of fat you lose.It may not seem as though keeping track of what you eat and drink would significantly affect fat loss, but you can see how powerful nutritional journals are by taking a closer look at the most popular and enduring weight loss businesses. Most popular programs do not necessarily use a journal, but they generally use something to help you keep track of what you eat. This typically involves things like following a point system or eating pre-made meals that have specific calorie contents.Regardless of what system is used, the real benefits come from making you keep track of what you eat and drink and not from some special characteristic of one particular system. Some people will certainly prefer one system over another, but the specific system is not really all that important. By tracking your eating and drinking habits, you become more aware of everything that you put into your body. As a result, your unconscious eating habits start becoming more conscious eating choices.In other words, by keeping track of foods, calories, points, etc., you are actually increasing your awareness about how and what you eat. Many people have poor eating habits and they often don’t realize how much or how frequently they eat. By following this type of system, you can stop being a slave to poor eating habits and start making more conscious decisions about what you put into your body.Fortunately, you don’t have to sign up for one of those programs, because you can get almost all the same benefits from keeping a nutritional journal on your own. A personal nutrition journal doesn’t have to contain every little detail about what you eat and drink, although a journal with more useful information generally results in greater fat loss over time. However, even a simple journal with very basic information may significantly improve your fat loss.Just the act of writing down the items you eat and drink, along with the time you had them, will make you think more seriously about your nutritional choices. For instance, if you are supposed to be eating healthy and you find yourself writing down a lot of junk food or other empty calories, you will see how much you are straying from the way you are supposed to eat. Then the next time you start to have chips or cookies, you will probably think about having to write it down, which by itself may make you stop and choose something healthier or have a smaller portion instead.Keeping this type of basic journal is very quick and easy and you do not need any special equipment. You can use a pen and paper, computer, iPhone, or whatever else works for you. The only thing is that you should write down what you eat/drink fairly soon afterwards, because if you wait too long, you may forget some things or the information will otherwise not be as accurate. The more accurate your information, the more it will help you.If you are willing to put forth a little more effort with your nutritional journal, you can also use it to fine tune your nutrition program and further improve your overall health and fat loss over time. To get more out of your nutritional journal, I still recommend keeping track of what and when you eat and drink, but you will also have to look at more specific components of your food. At the minimum, you should keep track of total calories, calories from fat, calories from protein, calories from carbohydrates, and grams of fiber.You can go further and break things down even more to include variables such as calories from sugar, calories from trans-fats, calories from saturated fat, etc. In these cases, the important thing is to have the information be in numerical form and have almost every category use the same type of measurement. For example, in the above categories, everything is broken down into number of calories per item/ingredient. You don’t have to use calories, but it is probably the easiest.The issue is that much of this information will not originally be listed in terms of calories, but rather grams. The problem with grams is that all grams are not equal in terms of calories. For instance, one gram of carbohydrate or protein is about 4 calories, alcohol is 7 calories, and fat is 9 calories, so simply writing down everything in terms of grams does not really provide a clear picture of your overall nutritional intake. By converting everything into calories, you can easily compare your intake of each type of ingredient to find out what you need to add or what you should consume less.On the other hand, fiber does not have any calories, so you should still record it in grams, because you want to eat at least 25 grams per day. Your fiber should ideally come from both soluble and insoluble sources, but most of it will probably be insoluble. In any case, if you see that you are not getting close to the minimum 25 grams of fiber, you should make it a priority to eat more foods that are high in fiber. However, without keeping track of your fiber intake, you may not even realize that you need more fiber. These types of changes are important, because improving fiber intake can cause significant your long-term health and fat loss.Some people choose to track their nutrition in even greater detail and additionally record their intake of vitamins, minerals, and other micronutrients. However, I would not recommend nutritional journaling for anything this involved as it would take way too much time and effort. If you want stats on everything, there are numerous computer programs available to help you keep track of all this information. For most people, a more basic nutritional journal will work just as well.If you have never tried keeping a nutritional journal, it may sound like more effort than it is worth, but this is certainly not the case. The most basic journals are easy to keep and take very little time and keeping a nutritional journal really does increase your awareness and makes you more accountable for your eating habits. This can be very empowering, but it also makes you take responsibility for how and what you eat, which is probably one of the big reasons why many people are unwilling to try nutritional journaling.It is certainly easier to follow your regular eating habits without giving them much thought and if you have good nutritional habits, this approach may be fine. Unfortunately, many people do not have the best eating habits and this is problematic, because so much of long-term health and fat loss success is dependent developing good habits. Keeping a nutritional journal will let you identify the problems in your current eating program and help motivate you to replace bad eating habits with good ones over time.There really are many different ways that keeping a nutritional journal can help improve your nutritional habits and ultimately your fat loss, so I hope you at least give a simple journal a try. Keeping a nutrition journal often results in more significant improvement than people first expect, but it works best when you are honest, accurate, and consistent with your journal. In any case, a nutritional journal will certainly give you better results than the next new miracle pill or similarly gimmicky health and fitness product that promises great results with minimal effort.