fuzzballl 9:46 am on Tuesday, March 15, 2016
Tags: ContangoETFs ( 446 )

BIB….not VRX

Guessing BIB is down today due to catching shrapnel from the VRX implosion. Is it temporary?

Bought BIB covered stock at 37.70…short this Friday 39 calls. Could make 1.30 quickly or own it at a decent price.

EDIT…thought about selling VRX puts but who knows where this thing goes. Iceman whaddya think? I know we did pretty good on their initial implosion but this seems different….

rknight52 10:00 am on Tuesday, March 15, 2016

Trying to sell the 38 put for Friday at 0.90 which is midpoint, but not much interest. We shall see.
- rknight52 10:01 am on Tuesday, March 15, 2016
  
  Whoo-hoo. Sold it. If I’m put the stock, then cost basis of 37.10. If not, then a nice 90 bucks.
thomberg1201 11:58 am on Tuesday, March 15, 2016

I have learned the hard way about trying to play the drastic drops near the end of the first or 2nd day, seems unnecessarily risky for my tolerance level. RK-good luck!
- rknight52 12:17 pm on Tuesday, March 15, 2016
  
  I’m OK being put the stock there. Will start selling calls against it then.
- fuzzballl 12:22 pm on Tuesday, March 15, 2016
  
  For me it’s a core position in my 401k that I like to trade around. Don’t mind holding it for awhile so don’t mind adding down here…unless it goes to 10! LOL
  - thomberg1201 12:23 pm on Tuesday, March 15, 2016
    
    Is BIB part of the contango family of ETFs?
    - fuzzballl 12:33 pm on Tuesday, March 15, 2016
      
      Nope:
      
      https://www.etfchannel.com/etfs/?symbol=bib
      
      https://www.splithistory.com/?symbol=bib
      
      BIB Split History Table
      Date Ratio
      10/05/2012 2 for 1
      01/24/2014 2 for 1
      05/20/2015 2 for 1
      
      Start date: 04/09/2010
      End date: 03/14/2016
      Start price/share: $7.51
      End price/share: $41.36
      Starting shares: 1,331.56
      Ending shares: 1,333.83
      Dividends reinvested/share: $0.01
      Total return: 451.67%
      Average Annual Total Return: 33.35%
      Starting investment: $10,000.00
      Ending investment: $55,174.63
      Years: 5.93
      - thomberg1201 12:52 pm on Tuesday, March 15, 2016
        
        Pretty impressive, thanks for the info
        
        fuzzballl 12:56 pm on Tuesday, March 15, 2016
        
        LOL…it was even more impressive at 106 a few months ago.
    - Jeff 7:48 pm on Tuesday, March 15, 2016
      
      Check out $BIS… inverse of BIB. They are both “Ultra”, 2x levered, so they would be subject to downward pull due to compounding. But Biotech has been generally bullish until recently (see NBI monthly chart) – so the BIB chart had been mostly up.
      
      #ContangoETFs
      - fuzzballl 8:16 pm on Tuesday, March 15, 2016
        
        Thanks Jeff! Looking a little closer at the ETF Channel website I see that BIB contains about 190 stocks but also does hold some biotech futures contracts of some sort (never knew there was such a thing). Not exactly sure what they are but they all contain the term “swap” in their name.
        
        The biggest one is:
        
        Nasdaq Biotechnology Index Swap Societe Generale
        
        I guess for something to be subjected to downward pull futures contracts have to be involved since the constant roll is the drag? Let’s hope BIB is more like SVXY and BIS is the UVXY of this sector!
geewhiz112 12:09 pm on Tuesday, March 15, 2016

$BIB @fuzzball
Like the covered call idea. I am in at 37.25

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