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  • Experts See Low Oil Prices For Decades To Come As U.S. Shale Boom Goes Global [View article]
    You are partially correct though in that a large amount of old tired rigs get retired with the slowdown. They are replaced by bigger, faster, more efficient rigs. This happens every time their is a slowdown, and I'm sure it happens in other industries besides the oilfield.

    But these new rigs are not what allow horizontal drilling and fracking to take place. That is owed more to the service companies and their capabilities. You can take an old water well rig and drill a horizontal on it.
    Nov 21, 2015. 05:15 PM | Likes Like |Link to Comment
  • Experts See Low Oil Prices For Decades To Come As U.S. Shale Boom Goes Global [View article]
    I don't need to read about rigs since I have upfront personal knowledge with them.

    We have been drilling two mile long horizontal wells (7000-8000 ft vertical depth before the curve, 20000' total length) in north dakota since the early 2000's with rigs made in the late seventies. The precision needed to land a 2foot thick payzone at 90 degrees and keep the bit in zone has been around since late 80's, early 90s. Again just read some halliburton or schlumberger documentation.

    For me the main thing that happened with the so called 'shale' revolution is that oil price rose over $100, and banks and entrepreneurs, eager to exploit the next bubble, jumped on the chance for massive leverage and speculation. Combine this with massive amounts of open land and private property in the US and you have a situation that is unique to the US (and maybe could happen in canada).

    Read up on cheasapeake and their massive land grab for an example of what led to this revolution.

    Again this is unique to the states and highly doubt these kinds of scenarios can play out in other countries (imagine private oil companies racing to grab leases in russia, china, or brazil?)
    Nov 21, 2015. 05:12 PM | Likes Like |Link to Comment
  • WSJ's Jakab: 4T cf in nat gas storage ought to "terrify" energy investors [View news story]
    Also didn't china just announce a 28% discount on natural gas? That will likely reduce our chances of exports (or at least profitability)
    Nov 21, 2015. 10:18 AM | 1 Like Like |Link to Comment
  • Experts See Low Oil Prices For Decades To Come As U.S. Shale Boom Goes Global [View article]
    Horizontal drilling has been around for decades.

    US land rigs are generally not as advanced as offshore rigs. International rigs have similar capacity to what is and has been available on US land for decades.

    All a company like the National Iranian Oil Company or PEMEX has to do is contract a service outfit like Schlumberger or Halliburton to drill horizontal wells for them. This has also been happening for decades.

    So no, no extra expertise is needed from the oil companies to drill horizontal when they can outsource the entire project, and no US land drillers will be unable to find any new business offshore as that is sure to be taken up already by others.
    Nov 20, 2015. 03:00 PM | 2 Likes Like |Link to Comment
  • KaloBios: Martin Shkreli's Latest 900% Price Hike - Bezek's Daily Briefing [View article]
    "I will pay them and be back trading....only with set stops this time. What an expensive lesson that was."

    Looks like he didn't learn his lesson if he's still thinking about using stops to guard against this. How will that protect from a gap up?

    The better lesson I would say is why would anyone want to short a $2 stock?
    Nov 19, 2015. 11:54 AM | Likes Like |Link to Comment
  • How This Options Trader Shorts Netflix [View article]

    When that 33BPS goes against you it can turn into a much larger portion of your portfolio, so in this case let's say the 33 BPS turns into 100BPS, and you've doubled and tripled down, now what? Hang on to loosers or re-evaluate?

    edit: nevermind, your using puts, i was thinking you may have been selling calls. In that case it doesn't matter much.
    Nov 18, 2015. 04:27 PM | Likes Like |Link to Comment
  • Will Santa Claus Bring Volatility? [View article]
    Aarc, very nice charts. Would be cool to see your interpretation of either the VIX or UVXY/VXX.
    Nov 16, 2015. 01:05 PM | Likes Like |Link to Comment
  • Will Santa Claus Bring Volatility? [View article]
    Instead of buying UVXY outright I've started experimenting with buying SPY puts. They are massively cheap on UVXY down days or when UVXY is approaching new lows. They also seem to hold their value quite a bit better than UVXY/VXX itself or calls on either.
    Nov 15, 2015. 02:26 PM | 1 Like Like |Link to Comment
  • Will Santa Claus Bring Volatility? [View article]
    Thanks for another article and continued forum on volatility.

    You wrote "Volatility investors are becoming more fearful that the U.S. economy may go from slow growth to none at all".

    The way I understand it, it's not volatility investors (is there such thing?) but the actual implied volatilities in SPX put and call options that determines the VIX. This by extension affects the VIX futures, which is what the etfs are composed off.

    So it would actually be investors in general becoming more fearful that would create or sustain an increased volatility environment.

    Volatility investors (or more like speculators) are persons like yourself and I and a bunch of others here on SA and else where that speculate on the direction of the VIX and VIX futures. However, those populations by themselves do have no or little influence in the day to day movements of the VIX. It is the action in the SPX options that determines this.

    Just thought I'd try to expand on your sentence, keep up the great work.
    Nov 15, 2015. 02:19 PM | 1 Like Like |Link to Comment
  • Top 5 Indicators To Short Volatility [View article]

    I have a long vol. signal from 11/9, however I can never resist shorting the large spikes that we get in UVXY.

    So i've exited all my long XIV, shorted some XIV, and today sold a 45 call on UVXY Dec. 4th. So I try to play both ways as much as I can.

    I've gathered a few SPY puts during the last couple weeks on UVXY down days, mostly as insurance, so I have some cover in case the calls start going against me.

    We'll see if this market degenerates further or if were just getting another little shakeout for the holidays.
    Nov 13, 2015. 09:12 PM | Likes Like |Link to Comment
  • Selling Intensifies; The Correction In Charts - Bezek's Daily Briefing [View article]
    Good explanation Ian,

    For me I've bought some SPY puts during the new lows made on UVXY (not all time lows, but the recent lows) that have been doing nice, also shorted some XIV on 11/9 as part of my long vol. signal.

    I think right now it's not the safest to directly short UVXY (though I always short a very small amount on every up day and cover back on down days.)

    But with these nice spikes I have to at least nibble with some short UVXY calls, about 15-20% otm at the moment. 4th weekly usually, to enjoy the quick time decay while receiving some premium.

    We'll see if the pattern holds here, as every Friday since Aug. 24th seems to bring with it increased nervousness and jitters from market participant perhaps fearing another 'black' Monday. Then nothing happens Monday and volatility (or VIX/UVXY/ect.) quickly fades.
    Nov 13, 2015. 08:56 PM | Likes Like |Link to Comment
  • Selling Intensifies; The Correction In Charts - Bezek's Daily Briefing [View article]
    Good time to sell some UVXY on spikes? Or wait a bit and see if this selloff picks up more steam.
    Nov 13, 2015. 09:54 AM | 1 Like Like |Link to Comment
  • XIV And High-Beta Investments In Bull Markets [View article]
    I suppose Harry Long's 'superior' strategies are the only ones worth considering!
    Nov 10, 2015. 10:12 AM | Likes Like |Link to Comment
  • Top 5 Indicators To Short Volatility [View article]

    This is very true and part of the reason VXX and UVXY held up so good even with the VIX itself dropping. However that very high volatility itself caused both to eventually fall back to their pre-spike levels, while not allowing XIV/SVXY to return to their pre-spike levels.

    Contango and the premium of futures themselves also have a lot to do. Eventually these will collapse, along with the VIX, sending VXX/UVXY to about half their value and allowing XIV/SVXY to return to their previous levels or close to it.

    Or they can turn around here and start rising, causing more destruction to XIV value and elevating and holding VXX values for a while. Either way high daily moves like the ones experienced in Aug/Sep will act as a drag on both sides of the Vol. trade (on the ETF side of things, with futures it's a different leveraged beast).
    Nov 9, 2015. 04:24 PM | Likes Like |Link to Comment
  • Top 5 Indicators To Short Volatility [View article]
    I'm not Nathan but this is due to volatility drag. Look at uvxy, it's already back full circle as you say for the vix. This is one case were its better to be short an etf than long its inverse.
    Nov 8, 2015. 10:39 PM | Likes Like |Link to Comment