UltraShort S&P500 ProShares (NYSE: SDS) is recently trading at $65.10 in pre-open trading, below its close of $72.50. SDS seeks daily investment results that correspond to twice the inverse daily performance of the S&P 500. SDS October option implied volatility of 66 is above its 26-week average of 46 according to Track Data, suggesting larger price movement.

UltraShort FTSE/Xinhua China 25 Proshares (NYSE: FXP) is recently trading at $88.52 in pre-open trading, below its close of $108.55. FXP October option implied volatility of 133 is above its 26-week average of 79 according to Track Data, suggesting larger price movement.

UltraShort Financials ProShares (NYSE: SKF) is recently trading at $87.96 in pre-open trading, below its close of $115.44. SKF is an exchange-traded fund seeking daily investment results that correspond to twice (200%) the inverse (opposite) of the daily performance of the Dow Jones U.S. Financials Index. SKF October option implied volatility of 161 is above its 26-week average of 75 according to Track Data, suggesting larger price movement.

Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com.

Have you taken a look at China? Wow. All those voices that have said that China is going to the moon. Have you taken a look at the FTSE/Xinhua China 25 Index (NYSE: FXI) lately? It's down over 40% from its recent highs and looks to be headed lower -- at least for now. Investors who used the Proshares Ultrashort FTSE/Xinhua China 25 Index (Amex: FXP) would have fared a lot better as such an index tries to use leverage and outperform the inverse of the China index. In other words, the FXP shorts the Chinese market. It's up almost 50% just year to date.

According to an article at MarketWatch, China's retreated for the 5th straight day on worries of continued monetary policy tightening by the Chinese central bank.

Although the EU has ruled out an Olympic boycott over the violence in Tibet, what's happening there is certainly adding to the feelings of a quickly growing economic and political power running amok. In typical fashion, Europe refuses to speak out against such types of aggression. According to the FT, Mark Malloch-Brown, the UK's minister for Africa, Asia and the United Nations, told the BBC: "This [the Olympics] is China's coming out party and they should take great care to do nothing that will wreck that."

With the way the Chinese and Hong Kong stock markets are behaving, it doesn't look as though the princess will be ready for her coming out party in a few months. It's probably going to take more time as China's growth is forcing it to deal with hard issues such as soaring inflation, domestic unrest, and heavy-handed politics.

Zack Miller is the managing editor of IsraelNewsletter.com and a former equity analyst for a leading multinational hedge fund.

Based in London, Nick Vardy is among the leading international stock experts. The editor of The Global Bull Market Alert has created a package of stocks called the "Ultimate Defensive Global Bull Market Alert" Portfolio -- using ETFs to go short on China and the British pound while simultaneously going long on agriculture and the yen.

"UltraShort FTSE/Xinhua China 25 ProShares (ASE: FXP) has been a hero during market weakness. While the market's current focus is on the exposure of Chinese banks to U.S. subprime loans, the real issue in Chinese banks is their own bad loans to state-owned enterprises. China has a long way to fall.

"Short the CurrencyShares British Pound Sterling Trust (NYSE: FXB). With the U.K.'s fundamentals perhaps weaker than the United States, the U.K. currency should continue to weaken over the coming months.

"PowerShares DB Agriculture (NYSE: DBA) invests in some of the most liquid and widely traded agricultural commodities, corn, wheat, soy beans and sugar.

"Buy the Currency Shares Japanese Yen Trust (NYSE: FXY). The yen zigs when the rest of the market zags. A position in the Yen won't knock your socks off in terms of performance. But it will hold up well in times of turmoil and appreciate steadily as the 'carry trade' unwinds.

"A word of warning: This is a 'defensive' global portfolio that will hold up the best during periods of negative market sentiment. But understand that this is also the part of the portfolio that will underperform -- perhaps significantly -- on any 'relief rally' in the markets."

Each day, Steven Halpern's TheStockAdvisors.com offers the latest market commentary and favorite investment ideas from the nation's leading financial newsletter advisors.