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Think Bit Coin Is Just a Bubble? 5 Best Methods to Short It

The CEO of J.P. Morgan this week predicted Bit coin that a "fraud" and "worse compared to tulip bulbs" If you agree, then it could be tempting to gamble from the digital money. Sure, the purchase price has had a beating recently however it's up 400 percent from January (,850 at the time of Thursday) --offering a chance for Bit coin bears.
So just how can you short Bit coin? It isn't easy because of deficiency of lending options (in accordance with other resources) and because a few tactics are on a specialist trader. Nevertheless, here are just five approaches for bears to gamble against the entire world's most common digital money.
Inch) Buy it around perimeter market it
Trading programs such as Coin base-owned GDAX let you buy online margin. While gross profit purchases normally entail adding leverage to proceed long within an advantage, in addition, it is feasible to go short by purchasing bit coins on perimeter, and shutting out the career after on. In the event the purchase price tag on bit coins drops in that moment, you're benefit from the commerce.
You will find a couple of caveats. It's that GDAX requires U.S. occupants to get at least 5 million should they would like to exchange on margin. (San Francisco-based rival Kraken does not appear to possess this limitation). The alternative is that clients can simply exit margin places available for a rather brief amount of time--27 days while in the instance of GDAX--that means individuals gambling on a fall in Bit coin desire it to fall in short sequence, or they'll need to pay the purchase price growth.
Two) Short stocks of this Bit-coin Investment Trust
The SEC this season refused a program by the Winklevoss twins to establish a Bit coin ETF. The stocks of the ETF will have exchanged to a significant market, also let average traders utilize their broker account to short them at precisely the exact same way as a average inventory exchange.
The SEC is reconsidering your choice however, at the meantime, the only real stock-like alternate could be your Bit Coin Investment Trust. As its name implies this is just a hope which holds Bit coin and enables people exchange its shares under the ticker GBTC.
Once more, you'll find grabs. It's that GBTC isn't permitted trade on major exchanges, therefore as an alternative it's recorded on OTC Markets (aka the "pink sheets") alongside other misfit toys of this auctions globe. Enormous brokerages such as TD Ameritrade do enable traders purchase OTC-listed stocks however, perhaps not short them, helping to make it more challenging to gamble against GBTC. At length, the purchase price tag on Bit Coin Trust stocks have gotten untethered into the amount tag on Bit coin (it's ostensibly broken within an investment vehicle) therefore a brief bet isn't quite a bet on Bit coin itself.
3) Buy derivatives on LedgerX (if they arrive)
Experienced investors might want to wade in the entire world of options and other derivatives like a means to become more bearish on Bit coin. Specifically, they can get a "put option" to market Bit coin during its present flat-rate cost. In the event the purchase price tag on Bit coin starts falling, the possibility increases in value along with also its owner can pocket an advantage.
These derivative contracts aren't available yet; however, they should be so on. Back in July the Commodity Futures Trading Commission approved a bid by a company named Ledger X to start a clearing house to get crypto currency places, calls, swaps and a wide range of additional exotic contracts. Ledger X is predicted to be available for business within the not too distant future.
(Update: There is also Hong Kong-based Bitmex, and it is a long-time purveyor of all bitcoin-related derivatives. 1 catch: all of trades, in addition to losses and profits, are ran in Bit coin--meaning you have to purchase Bit coin until you are able to view it).
4) Ask Goldman Sachs to compose you a contract

Tsakos Energy Navigation Ltd | 8.00% Series B Cumulative Redeemable Perpetual (TNP.PRB)

Prospectus excerpt: We are offering 2,000,000 of our 8.00% Cumulative Redeemable Perpetual Series B Preferred Shares, par value $1.00 per share, liquidation preference $25.00 per share (the “Series B Preferred Shares”).

Dividends on the Series B Preferred Shares are cumulative from the date of original issue and will be payable quarterly in arrears on the 30th day of January, April, July and October of each year, commencing July 30, 2013, when, as and if declared by our board of directors. Dividends will be payable out of amounts legally available therefore at an initial rate equal to 8.00% per annum of the stated liquidation preference, subject to adjustment as described in this prospectus supplement.

At any time on or after July 30, 2018, the Series B Preferred Shares may be redeemed, in whole or in part, out of amounts legally available therefore, at a redemption price of $25.00 per share plus an amount equal to all accumulated and unpaid dividends thereon to the date of redemption, whether or not declared. If (i) we fail to comply with certain covenants (a “Covenant Default”), (ii) we experience certain defaults under any of our credit facilities (a “Cross Default”), (iii) four quarterly dividends payable on the Series B Preferred Shares are in arrears (a “Dividend Payment Default”) or (iv) the Series B Preferred Shares are not redeemed in whole by July 30, 2019 (a “Failure to Redeem”), the dividend rate payable on the Series B Preferred Shares shall increase, subject to an aggregate maximum rate per annum of 25% prior to July 30, 2018 and 30% thereafter, to a rate that is 1.25 times the dividend rate payable on the Series B Preferred Shares as of the close of business on the day immediately preceding the Covenant Default, Cross Default, Divided Payment Default or Failure to Redeem, as applicable, and on each subsequent Dividend Payment Date, the dividend rate payable shall increase to a rate that is 1.25 times the dividend rate payable on the Series B Preferred Shares as in effect as of the close of business on the day immediately preceding such Dividend Payment Date, until the Covenant Default, Cross Default or Dividend Payment Default is cured or the Series B Preferred Shares are no longer outstanding. Please read “Description of Series B Preferred Shares—Dividends—Dividend Payment Dates—Increase in Base Dividend Rate Following a Covenant Default, Cross Default, Dividend Payment Default or Failure to Redeem.”

Full Prospectus PDF », TNP Page »

Alternate symbology:TNP-B, TNP-PB, TNPprB
Call Date:7/30/2018
Shares Offered:2,000,000
Liquidation Preference:$25
Recent Market Price:$24.94
Discount to Liquidation Preference:
(More Preferreds Trading at a Discount »)
$-0.06 (-0.24%)
Annualized Dividend:2
Recent Ex-Date:1/26/2018
Current Yield:8.02%
Original Coupon:8.00%
Pay Period:Quarterly
Pay Dates:30-Jan, 30-Apr, 30-Jul, 30-Oct
Tsakos Energy Navigation Limited is a provider of international seaborne crude oil and petroleum product transportation services. As of Apr. 5, 2017, Co. operated a fleet of 57 modern crude oil and petroleum product tankers that provide world-wide marine transportation services for national, major and other independent oil companies and refiners under long, medium and short-term charters. Co.'s fleet fleet also includes two LNG carriers and three suezmax shuttle tankers with advanced dynamic positioning technology (DP2), bringing the total operating fleet to 62 vessels.


Open the TNP Information Page »
Name: Tsakos Energy Navigation Ltd
Sector: Oil & Gas Equipment & Services
Number of ETFs Holding TNP: 5 (see which ones)
Total Market Value Held by ETFs: $8,211,218
Total Market Capitalization: $335,000,000
% of Market Cap. Held by ETFs: 2.45%

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