ETFs, Bernanke, and The Tooth Fairy: Profit Either Way From Jackson Hole Decisions; The Perfect Setup

Many are expecting Bernanke to save the world and engage an another massive 'kick the can down the road" exercise tomorrow, i.e, QE3.

As such, QE3 may already be built-into prices.  If Mr. Fisher is right, and Bernanke is not the tooth fairy, the market swill be disappointed, and prices will reflect this. If QE3 happens, then gold will resume its parabolic move. It's a perfect setup.

Here are straddles on popular ETFs, to profit either way, up or down. Computed with StraddlesCalc.

Given the volatility, massive moves are possible, and so are profits, as were our past straddles last month.

This is not advice. Options are dangerous and may cause 10% loss. Please do your own due diligence,.

Markets Dive Again: Huge Profits on ETFs

Here is the current situation with our ETF straddles:

Not bad at all.

Big profits post debt-ceiling mess through ETF options

This is an update from our July 27 post. Here are the results, from this AM.

Our favorite ETF for straddles, IWM,  met expectations, and shows a profit of +80.50%. GLD is 2nd, at +24.5%. FXY is near break even:

The debt ceiling crisis: profitting through ETFs, either way, up or down

The debt ceiling crisis in the U.S. is  a prime situation for straddles. If the crisis is not solved, stocks will go down crashing. It is solved, then gold will come back down.

Straddles allow an investor to profit either way, up or down, provided the underlying stock moves a minimum amount.

There are straddles for August 2011, using three very popular ETFs: IWM (Russel 2000), GLD (gold), and FXY (Yen):

Please do your own due diligence. Options are dangerous and may cause 100% loss.