A BRIC'd-up, copper-framed, gas-powered, gold-plated La-Z-Boy.
Construction began today. It may take some time to assemble, and of course I enjoy tinkering under the hood long after it rolls off the line.
(a) FEMKX (Fidelity Emerging Markets). China, Brazil, and India are in no danger of becoming obsolete. And I don't need the anxiety associated with RYWVX, a leveraged fund that achieves its daily targets using derivatives.
(b) RYVIX (Rydex Energy Services). Largest holding is French juggernaut Schlumberger.
(c) RYEIX (Rydex Energy). Think Chevron and Exxon Mobil.
(d) RYPMX (Rydex Precious Metals)/ GDX (majors)/ a range of individual companies. Miners are down -80% and regarded as road kill.
(e) RSX (Russia). Next to Greece, the least expensive stock market on the planet.
(f) FCX (Freeport-McMoRan). With both copper and oil at multi-year lows, if it wasn't for bad luck...
(g) PBR (Petrobras). Insult to injury. A victim of plunging oil prices and a corruption scandal.
Consider proper position sizing and/or trading around a core position. A 'Made in US' La-Z-Boy? Wait for the Fall/Winter Clearance Sale.
Is this a portfolio you have already begun or are you waiting til fall / winter?
ReplyDeleteI decided to start SLOWLY buying some TWTR. I bought some today around $28.25. I know, it's a POS and won't ever grow their user base. But it's still the 9th most trafficked site in the world and is still growing its top line tremendously. I have no idea when it will bottom. Or when it will make money. But I think it's worth building up a 10-20% position in it in the event it does turn out to be a company with 500M users and doing $10B in revenues. It might take 5 years, but I figure if they do get to that level and trade at 10x revenues then it's worth $100Billion, which is a return of roughly 5x from here (about 38% annually).
ReplyDeleteThe problems they have run into are:
Delete(1) Everyone thinks they're FB...they're not
(2) They don't have a founder CEO with a big stake in the company
(3) They aren't making money
On the plus side, they have still grown revenues from $28M in 2010 to an estimated $2.24B in 2015, 80x higher and a 140% annual growth rate.
Right now they trade at 8.48x CY rev est. and 5.86x 2016 rev est. Even though it shouldn't be compared to FB, it is trading at a 50% discount to them (FB is at 15.6x and 11.5x).
I like it. I'll try and find a spotm
DeleteDon't underestimate the power and influence of the Howard Stern show:
Delete"The wack pack recently discovered Periscope (as did we, follow us @sternshow) but unlike us (and probably you) the wack pack are almost exclusively unemployed.
Not only does Fred the Elephant boy's adversary High Pitch Erik Periscope (and demand Yankee tickets and dinner from anyone who happens to be watching) but Jeff the Drunk has what might be the best show going on the new app.
Photo: Howard Stern Productions
Jeff just sits around singing cover songs (which he is not paying for, to our knowledge), smoking, and hacking up a lung.
We try to give you a little something extra like a look at our back office during commercial breaks or Gary Sell'Abate pecking away at his computer keyboard. But whatever you're into, Persicope has something for you.
Follow Jeff the Drunk (https://twitter.com/jeffthedrunk1) or High Pitch Erik (https://twitter.com/hperik1971) if you have a lot of time to kill."
CVRR - How do you like that dividend, when would've been a good entry, maybe January or thereabouts?
ReplyDeleteI've never understood how the refinery business could be so volital. I get it would move but not so unexpectedly.
Deleteb/c low WTIC vs BRENT means a good spread for US refiners. Refine the WTIC, export the product and harvest the spread. Foreign refiners can't compete thus sales go through the roof (despite the stronger $US).
DeleteCSIQ is the worst ticker symbol ever.
ReplyDeleteDid Soros buy into coal? I heard a rumor....
ReplyDeleteNot for export apparently, rail roads aren't green.
DeleteHe nibbled on some coal, apparently. Necessary evil despite global warming?
DeleteI feel like the breakout in EWT in April was a trap. Not sure...
ReplyDeleteSEDG should test 23 I guess.
ReplyDeleteIn just about 10 minutes, looks like.
DeleteImpressive haircuts taking place out there, don't step in the wrong cow pie...
ReplyDelete"09:47AM The Fed: Greenspan warns about bond-market bubble"
ReplyDeleteACI - Up 50% now and solar tanking, global warming has ended! :)
ReplyDeleteSPX - I thought those BB's looked rather tight but had heard 3,000 was the target.....
ReplyDeleteRussian ADRs Drop as Fighting in Eastern Ukraine Sparks Selloff
ReplyDeleteIn case you guys weren't aware......
FLY - This one's been below the 200SMA for several sessions, huh?
ReplyDeleteEYES - Back to where it was before, is this one just a cash burning machine that eventually runs out of fuel?
ReplyDeleteMMYT - Why is this one green now, that's what I want to know....?
ReplyDeleteGive it some time. will be lower...
DeleteJONE - Does this company produce oil or just another poser? Cost to produce maybe $80/bbl?
ReplyDeleteb/c low WTIC vs BRENT means a good spread for US refiners. Refine the WTIC, export the product and harvest the spread. Foreign refiners can't compete thus sales go through the roof (despite the stronger $US)./Mark
ReplyDeleteb/c low WTIC vs BRENT means a good spread for US refiners. Refine the WTIC, export the product and harvest the spread. Foreign refiners can't compete thus sales go through the roof (despite the stronger $US).
Hi Dennis,
As a longtime WTI/Brent trader and one who
has dabbled in North Dakota crude, I wanted
to respond with my take to your request for
details on moving Bakken to market. Like
producers in any other province, Bakken
producers seek the highest netback for their
product. The cost and means of
transportation to that market are factors in
calculating the netback, not the sole means of
determining where the product should go.
Just because a pipeline may be the lowest
cost means of egress from the producing
basin doesn’t mean that it will take the oil to
its highest netback. For reference, pipelines
connect Bakken production only to refining
centers in the Rockies, the Upper Midwest,
the Mid-continent and the Texas gulf coast.
The WTI/Brent relationship is also important
to determining the disposition of Bakken
crude oil because, while North Dakota is
located in a WTI-priced region, it can be
transported to refining centers such as the
Atlantic coast where the alternative supply is
Brent-priced. As WTI strengthens or weakens
against Brent, a producer’s incentive to sell
into the pipeline increases or decreases
respectively, compared with its alternative on
rail.
Best regards,
CP/Mark discussion at top
DeleteYes, that's for producers. the spread is I guess the topic. Interesting note, ALDW switched from making diesel to heavier products for roads last Q. Not sure where they got the heavier crude, maybe Canada or if they're using the light stuff and refining it down but I think they switched to heavy crude maybe a blend.
DeleteApparently ALDW can swap back and forth from light and dark stuff, combine and blend, etc. They used to make styrene too, back in the day before Fina sold the refinery.
Leon Bought some oily stuff recently:
ReplyDeletehttp://www.sec.gov/Archives/edgar/data/898382/000089838215000038/xslF345X03/primary_doc.xml
Soros - If this guy is a supporter of global warming then why did he have some YPF, dunno if he's still got it but I can check...
ReplyDeleteSPH - Pretty nice divy too. Now you'd think cheap propane would be a tailwind for this company since they're not a producer but a dealer? Propane heat is nice to have if you're not near natty infrastructure, wish I had gone this way for heat pump backup as propane prices fall and liable to be cheap for awhile?
ReplyDeleteURI - What do you guys think, if home building is hot then why not rent equipment? These guys even sell equipment to overseas customers but that part is unclear to me although I was told they send shipping containers of equipment to overseas customers.
ReplyDeleteI just realized how much more I like making money than losing it.
ReplyDeleteGDX hanging in there.
ReplyDeleteI hopped back into the BIS trade today at $28.5. I'm sure I'll be down on it tomorrow.
ReplyDeleteI was also looking at HMY. That thing has a book value of over $6/share. Is this normal in this space to have such a huge discount?
Sold after hours at 28.6
DeleteYeah, he's backed off on HMY - wouldn't be surprised if he even sold. Here are his last comments:
ReplyDeleteThis has lots of problems. Production price is about $12.50 an ounce, which is high. They are trying to work on their mines and get the cost lower. Having difficulty with labour which is asking for a 60% wage increase. CEO is looking for a replacement. Have a wonderful play in Papua New Guinea of gold/copper, but can’t really finance it at this time. Potentially they could go under, but he is willing to continue holding as it has a lot of upside if gold goes up. Very, very dangerous.
He bought a 4-pack of Canadian gold miners last December:
Gold. Not a bull or a bear on gold at this time. Gold is off by more than a third, but if you go back a number of years it came down from $850 to around $250. It could fall from here. In Nov/Dec, he bought into 4 gold companies Alacer Gold (ASR-T), Golden Star (GSC-T), Orvana (ORV-T) and St. Andrew Goldfields (SAS-T) and is just a little ahead. He likes the idea of having some gold in his portfolio when it is not too expensive. 3 of these companies have really clean balance sheets, which is critical to him. These are the ones that could return to form, but doesn’t expect this to happen very quickly.
ASR is probably his favourite of these, but it is up 24% YTD.
TD out with a report this morning saying equity prices for energy companies at the lowest price / net asset value in 10 years. so, if you think oil prices have bottomed, the stocks are even cheaper. Just hard to know if oil really has bottomed!
ReplyDeleteProblem is we have only been in a bull market the past 10 years! What about the bear markets?
DeleteIs all the margin out of gold? That's one of the criteria listed, for a bottom.
DeleteThis is why I'm only trading oil's now, if history is correct, this so earnings compression dead ahead.
Deletehttp://www.zerohedge.com/news/2015-08-19/what-todays-oil-plunge-2009-levels-means-earnings-one-chart
SLB HAL OXY and pipeline KMI are my goto's now on a sardine basis.
http://www.zerohedge.com/news/2015-08-19/what-todays-oil-plunge-2009-levels-means-earnings-one-chart
BXMT let go most of all yesterday interested still but suspect mkt is not going to have a good fall, plus leav ing for the East Coast.
this shows earnings compression dead ahead
DeleteI'm not comprehending how earnings compression is good, unless you're looking for a lower priced entry. I guess that's your goal.
DeleteBABA - We should buy this one at some point.
ReplyDeleteGold - Looks to be filling gap down. Shoulda known.... Any other gaps down to fill?
ReplyDeleteLong RUSS at $46.1
ReplyDeleteI haven't even turned on my trading platform yet and I know that's ballsy.
Deletehaha. yeah it is. managing my position sizes like i have all year, though.
DeleteCHLN - Did you guys see yesterday's move? SOHU and BABA especially should do well (after a bottom).
ReplyDeleteMMYT - Back on track, was wondering about that.....
ReplyDeletetold ya. was only a matter of time.
DeleteTA - Don't forget about this one, gasoline proces should remain low for some time, no?
ReplyDeleteInteresting spot for CLNE.
ReplyDeleteIf this is a real LT top it's the most telegraphed EVER.
ReplyDeleteyeah, but i think traders are conditioned to buy dips so it could unravel over time to the point where everyone is like oh shit i'm down 35%!?!? and the the market could be a decent amount lower by then.
DeleteENPH- Lot of traders hanging out at 4.74.
ReplyDelete$4.13 target?
DeleteGDX
ReplyDeleteODMAX - Wondering about this one.....
ReplyDeleteIBB right on the edge of breaking down. still the strongest sector but if that goes then it could pull a lot of tech related stuff down.
ReplyDeleteSmoke em if you got em.
ReplyDeleteJust lit up.
DeletePOZN high probability it fills gap.
ReplyDeletewhoa. my old boss had that at $11. yikes.
DeleteAgree, maybe retest $6.50 of this storm worsens.
DeleteRyan Detrick, CMT @RyanDetrick 9m9 minutes ago
ReplyDeleteInternals ugly. 3 new highs and 35 new lows in $SPY. Over half of components down 10% from highs and 125 down 20%.
Capitulation? Or the start of a big down move?
DeleteENPH- Hidding at 4.49.
ReplyDeleteCP - Yeah, I've been watching TA for a while. Very interesting spot here around $12.50. That was an area of very long term resistance, see below:
ReplyDeletehttp://stockcharts.com/h-sc/ui?s=TA&p=D&yr=5&mn=0&dy=0&id=p39011964447
Housing sales 8 year high. Immigration?
ReplyDeleteChinese water torture proceeding on schedule.
ReplyDeleteMMYT - Look bitches, stop f'ing with me...
ReplyDelete"Never on a Friday" is a phrase that Jeff Saut uses when talking about how downturns never end on a Friday. However, I went back to the 2009 lows and the low was on Friday, March 6, 2009.
ReplyDeleteThus must be today is reversal day or the selling continues I guess. TGIBT
DeleteSVM - lol, what a rocket.
ReplyDeleteFormer governor Bob McDonald has 7 days to report to prison.
ReplyDeleteMUX - Now sporting a $1 handle, what a freakin' bullet!
ReplyDeleteImagine that, more oil production causes price declines. What expert would've guessed?
ReplyDeleteEYES - Only down 7% today.... I guess this one eventually falls under $1 too, then gets delisted, etc. receivership and all..
ReplyDeleteObviously...
DeleteFLWS - Going under $8, ya think?
ReplyDeleteLooks like the TZA trade has eluded me, after all... I entered it TWICE, and got stopped out flat twice. Third time was supposed to be a charm, but I missed it...
ReplyDeleteWell, at least I was able to back up the truck on GDX/GG when they had a 13 handle... The action plan is simple after today's rally -- place a stop under August 14 lows and let it ride, taking profits gradually once the level of producer hedges rises above 100K contracts.
EWT hit a 7 year high in April and its only down 25% since then. wow. Setting up for a big bounce. Studying the bounces in RSX and others to get a sense of what to look for
ReplyDeletelook at TTM. made an all time high in Feb at $51.80. It’s at $25.71 now. yeesh
ReplyDeleteGonna take off my RUSS. Taking gains whenever I can get em.
ReplyDeleteWhile driving today I pulled off the ENPH order. Now back and see it is sitting right where I thought. let's see how it trades.
ReplyDeleteNext real support is at 2.50. 4.50 isn't a 'real' support level anyway.
DeleteCan't believe it dude. I remember saying it was heading back to $4.50 when it was at $12 but I was kind of joking.
DeleteEYES- 8.20 would be your bogey.
ReplyDeleteSold RUSS at $47 and bought RUSL at $14.7. Daytrades only right now.
ReplyDeleteDouble down at $14.5. Still tiny position. Oil should at least stabilize a little if the dollar weakens more. That would line up with what happened with the Yen after its initial surge a year or so ago.
Delete$14.53 not $14.5. Won't hold this overnight unless RSX firms up into the close.
DeleteSold into the close at $14.57 or so. Took the small loss. Actually finished up for the day.
DeleteEYES "blind"sided.
ReplyDeleteDown is the new up. Nuts to butts.....
DeleteCYBR - Only a 10% haircut.... Who needs 'em when the Pentagon uses LMT s/w (unsuccessfully, but improvement in the works).
ReplyDeletePSEC - I only have 1/2 the position I wanted, now back to my most recent addition. Come on fellas, take her on down.... Ya shits!
ReplyDeleteWhat a stunning "economic recovery" (pump and dump) that never took root.
ReplyDelete(a) The DJIA now off -285 points. I think it's a healthy pullback. That's an opinion.
ReplyDelete(b) AAPL recovering slightly to a 112-handle.
(c) Taking profits on the majority of my position in miners at the close. GDX currently up another +5.1% for a 2-day gain of >8%. The tide may have turned for this sector, but it's likely to test the resolve of traders in the next few days.
(d) EEM off -1.7%, but a positive divergence has started in Brazil, with EWZ up +1%.
(e) Oils battered again today despite a strong reversal in crude off a new low.
I opened a trading position in AAPL this morning when it printed a 111-handle.
DeleteWhile it's never fun to have stocks go down, I'm kind of liking this pullback as well. Doesn't feel like the big one to me and, while I haven't added yet, I did a fair amount in the July pullback and probably will again if this gets down a bit further.
DeleteAlso thinking if Gold can turn upwards, maybe energy follows.
Who makes the vending machines MCD will use to avoid $15/hr employees?
ReplyDeleteCan we make any real money on the short side or no??
ReplyDeleteI made 0.1% today. What's up?
DeleteBored. Wife is busy at work so I'm helping driving the kids around. I will say this though, if I hear El-Erian say freaking 'barbell' again my head will explode.
DeleteI'm also ordering more useless electronics.
Deleteha. Sounds like you had a better day than me. I don't know what to do with all of the bucket loads of money I made today.
DeleteThis is kinda cool I guess. Kendra is going to make the Varsity soccer team as a freshman...and she's got a chance to start as the center forward. Her skills are way better than anyone on the team but HS soccer is very physical so we'll see. She's pretty thin.
DeleteSeems to me like the slide lower could continue all the way until the Fed meeting in September. Obviously there would be bounces along the way if this happens. Today was a pretty significant day in the bigger picture and not something to take lightly in my opinion. Could be wrong but that would be the pain trade...maybe some sideways chop for the next week, then more selling toward the end of next week.
ReplyDeleteAssuming this is the case, shorting SPY or buying SPXS on up mornings makes sense to me until we move back up above 2045 on a close.
DeleteI know I mentioned this a while ago, but check out the similarities to the 1974-1980 bull market to ours.
ReplyDeleteThe 1974 market bottomed in Sept/October 1974. It then rebounded and hit a high in Nov/Dec 1980. 6 years and 1 or 2 months. Almost identical amt of time to the rally we have seen since 2009. Probably just a coincidence.
Back then the market broke out to new highs in 1980 after having traded sideways for like 15 years. But the breakout faded and the market went down 28% over the next 21 months after that until the huge 1980's bull market began in August 1982. Wouldn't be surprised to see a similar setup given valuations aren't exactly cheap and there's a lot of issues in the world. Not sure if it could fall that much but maybe 20% over time?
I think the issue regarding sentiment that Mark mentioned is an important one. Obviously the mood is gnarly. But it's been 6 years of dip buying that has killed bears. Those guys are either dead or too scared to short now. So this could actually be a bad thing for the market. This 2045 is a very important area in the big picture. I'm thinking it's worth buying some SPXS if we get a bounce up to there.
DeleteBest Steakhouses ?
ReplyDeletehttp://www.msn.com/en-us/foodanddrink/foodnews/the-best-steakhouses-in-all-50-states/ss-AAdr72v?srcref=rss&OCID=TAB1Q23&fullscreen=true#image=51
I know what I'm having for dinner now.
DeleteGrabbed some eem on hope today was a temporary bottom. $33.7. Huge volume past 2 days
ReplyDeleteCG - Dividend is over 16%, what are the chances a big cut is coming, for whatever reason? Just think, 16%/yr is a great rate of return....
ReplyDeleteI'm pretty bored too Mark. Not enough downside for me to buy the stuff I like and nothing really good happening on the upside. Went golfing one day and out for a 4 hour lunch today. I bought a pressure pump for my reverse osmosis system, hung a new lamp and looking at VRBO to maybe go to Montreal for a weekend. No point in pushing things.
ReplyDeleteBut I've also been thinking along the same lines as TOF, that the market struggles into the Sept. Fed meeting, we get or don't get the rate hike (doesn't really matter), and the the market has some clarity and can move upwards.
Impressive action in the gold miners this week too. Maybe it is the real bottom this time.
Doubled up on eem. Avg is 33.56
ReplyDeleteFCAU - Well that's interesting... I see the IPO is announced.
ReplyDeleteAll global indexes have sliced through (up-) trend lines, boosting the odds that we’re now in a bear market.
ReplyDelete(a) Fear, greed, hope. In my opinion, hope is the most destructive. It’s hope that leads to large losses.
(b) When panic sets in, you want to be the first to panic. Get out early.
(c) Prices can and will move down longer and further than now imaginable. Look at the oil sector. Even large-cap ‘blue-chips’ like Chevron act like oil is headed to $20, and oil may well end up at $20.
It appears that stop-losses on most of my positions will be hit today. That’s fine. The market may instead snap back, and hard (now that traders have capitulated). I can’t predict what will happen, but I will honor my stops.
Starter in TASR
ReplyDeleteWhat is domestic only, has no exposure to foreign markets, and is not reliant upon a strong economy? TASR is about the only one I can think of in my watchlist.
DeleteRegional banks, guns, booze, cop equipment! Umm, and fire trucks in case of rioting? :)
DeleteMarkets bouncing now. Let's see how far this goes.
ReplyDeleteWait for the late day collapse? Not sure if buy and hold is a reasonable approach anymore, I hate flipping.....
ReplyDeleteKTEC - Stop sweep?
ReplyDeleteEVBS - There are no triple tops, right? Have you guys looked over EVBS' balance sheet?
ReplyDeleteLong AAPL $108.9 for a trade, like the others.
ReplyDeleteHit 20% down at its lows. I suspect it might plunge to slightly lower but it's just about done in the short term.
DeleteSo far on my watch list, TASR, Z, TREX, TA, EEM have all held early lows.
ReplyDeleteHAL - Wasn't support @ $36.9 ?
ReplyDeleteI sold my EEM at $33.30 for a small loss.
ReplyDeleteAshley Madison - Government employees expose themselves. Wonder where that leads, could get interesting?
ReplyDeleteBonds are Bonds
ReplyDeletehttp://thereformedbroker.com/2015/08/16/the-mlp-myth-blown-to-smithereens/
I've been thinking the same thing but don't comprehend this: "MLPs are a huge pain in the ass tax-wise" b/c filing is all done using software anyway and should be automagic?
DeleteTook the loss on AAPL. Standing to the side and gonna wait to see if theres more downside.
ReplyDeleteENPH- Bidding at magic number 4.19.
ReplyDeleteI had $4.13, prefer your more bullish number.
DeleteOur chance to buy BABA is approaching guys, why aren't we discussing this?
ReplyDeleteValuation isn't compelling enough to me.
DeleteSee you in September
Deletehttps://www.youtube.com/watch?v=iu-7DXBiVsA
nah make it October for BABA
Yep, not here yet but it's gonna be the Chinese Amazon, right?
DeleteOr maybe it'll be JD, possibly both or what ?
DeleteThere must be a huge fire burning somewhere, or phosphorus and cyanide explosions.... Gotta go, got stuff to do so can't watch.... Sucks to be buy and hold, it's been an expensive year for me.
ReplyDeleteBXMT nearing 50 dma
ReplyDeleteI like the inside and inst buying, need to look into that. Not sure if it does well as rates drop though.... Doesn't look like rates are poised to run, considering the environment?
DeletePSEC is surprising me, was hoping for a deep(er/est) dip.
My understanding is they have floating rates, so they will benefit from that, but it does not necessary mean the mkt will recognize this.
DeleteAlso, since I like this for income reasons, I own nearly none as I sold off all they will fill at 29.80 the other day. We must remember a bond is a bond and these types of play basically have equity fluctuation risk.
Personally to me in makes no sense to earn 7% or 13.93% if you lose 20 or 30% of principal, you may as well just spend your capital.
BTW CP, what do you like about PSEC?
DeleteKCLI, so the risk is if the mkt really tanks and they walk away from the 52.50 price if not a 14.5 % gain from here.
ReplyDeleteEven if the market really tanks, I am quite certain they do not walk. Book Value is over $70, so a good buy at $52.50, so accretive to remaining shareholders, plus save $7 million a year in filing, etc.
DeleteStock was around $43 before the offer, so that's probably near the low end should something happen, but I say the odds it goes through are 99%.
Good to know.
DeleteABAC - Nobody eats pork anymore.
ReplyDelete$39 oil. ding ding ding.
ReplyDeleteThere goes Russia
Can't figure out why IWM is doing so well on the day when SPY and QQQ are down so much. It actually looks like IWM will turn green soon...
ReplyDeleteIts a good sign so far
DeleteRussell 2000 was down 12% from highs at the lows today. Could be enough for the near term...who knows.
DeleteGrabbed some TA and TREX today at 12.03 and 40.05. Also bought some PYPL at 34.86. Still holding TASR.
ReplyDeleteTook all three positions off except TASR.
DeleteIf IWM turns green today, then I think a bounce toward 118, so as to fill the gap, will be in order. I closed my September puts in QQQ and IWM about half an hour ago, with the intent of rolling them over to a longer maturity (these puts were already into the money, but I still lost some money on them, because I bought them a year ago and paid a lot for volatility premium). But now I am thinking that I should buy longer-dated puts today only if IWM drops below the previous intraday low of 115, which seems to be very unlikely now. And if IWM finishes in the green, then I will wait for a bounce to 118 before reloading puts.
ReplyDeleteThat's what makes option trading so hard - even when you are right on the underlying stock, if you don't get the timing pretty much exact, you don't make money.
DeleteI think the wild choppy action today marks a standard short term bottom for the broad market.
ReplyDeleteJust for the heck of it, just purchased 2 VXX January 2016 puts with 21 strike for $5.25. I think today's volatility spike will pass...
ReplyDeleteAnd when it does, longer-term fear will still remain, creating a heavy contango in VIX futures, which will eat up VXX alive, as has always been the case in the past.
DeleteI closed out of all of my remaining longs. I bought a small position in RUSS on the off chance that we get a crash in emerging markets on Monday. I doubt it but you never know.
ReplyDeleteJust been sticking with day trades the past few days which has saved me a little. Need to see a bottom in place with a retest of that bottom.
DeleteWell, I had to buy something today. Days like this don't come often and, while it may not be the bottom, I have to think we are very close to the bottom (unless we crash). So I added to my position in auto parts company MRE.TO. Down 20% in a couple weeks, 6% today, very cheap with sub-10 p/e, exposure to the strong auto cycle, many costs in CDN$ vs. selling us$.
ReplyDeleteThe best scenario would be a panic open Monday with the Market down a few percent and then a finish in the green.
ReplyDeleteWho knows if we'll get it, but could be the final flush we need.
My portfolio is down over 10% in the last 2 weeks. Was hanging in well and thought it would get past this rough patch due to the value support in it, but sure turned out to be wrong on that. Looks like the sellers are coming after everything. I'll have to figure it out, but still up for the year, probably around 3%.
ReplyDeleteI'm about 85% long, which may seem high, but has worked this year until the last couple of weeks. I don't think this turns into a major correction, but will take a good hit and not have a lot of buying power if it does.
If we did get a lot more selling, my plan would be to sell some of those that have hung in well and buy into those which have been hit too hard, but hopefully, I don't have to make those decisions.
Not quite as bad as I thought - TD is not good with small stocks at putting the proper value in the accounts sometimes.
DeleteDown 9% for the month and still up 7% for the year.
Sucks when you are happy that you are "only" down 9% in a month.
Anyone else think there is a good chance for a bottom Monday?
ReplyDeleteOr maybe I'm just being too hopeful
I think the bottom was today, based on the wild choppy action in IWM.
DeleteBut the rebound rally from here will probably be very short lived...
DeleteThe way this market closed makes me open to the possibility of another fairly big drop on Monday. I think a lot of people are focusing on China but Russia seems to be just as big of a concern.
DeleteBeing on the sidelines isn't a horrible thing right now. It's most likely going to swing wildly and unless you want to just buy and hold something at a specific price, prepare to be sliced up if you're trading.
Russia's GDP is collapsing with oil down so much. Definitely adds to the worries and why I think we're getting some panicky selling. Again, it's not a horrible thing to be in cash.
DeleteI've been waiting for David to comment on Russia. I have my own observations but was hoping he'd have some sage insight.
DeleteWonder how Russia will be able to service their massive debt, considering their GDP is collapsing they must be on the verge of a currency crisis?
1230 pm (pst) post.
ReplyDeleteNo ‘let up’ in selling pressure heading into the close. DJIA now -474 points. A -3% pullback across the board in US indexes.
(a) The expected pullback in miners materializing. GDX (majors) -3%, and may reopen a half-position in RYPMX and/or selected companies at the close.
(b) EEM (emerging markets) now -2.9%. Closing a small position in FEMKX end of day. Emerging markets rarely bottom on a Friday. Should I decide to play again, will reopen on Monday.
(c) High volatility in FANG stocks-> after setting new highs recently, Facebook now off -14%, Amazon -15%, Neflix -20%, Google -10%.
(d) Crude futures tumbled below $40 intraday.
(e) Sold AAPL @ 111-and-change at the open, and may reopen here at a 105-handle for a short-term trade.
This may be a good time to review pain thresholds.
(a) A 5-10% pullback. Garden variety. Most of us take it in stride.
(b) 11-20% pullback. It gets painful. Personally, I find any double-digit loss intolerable.
(c) 21-30% pullback. Looks ‘tolerable’ on paper only. Excruciating to experience with an actual portfolio. Ask any investor in the Shanghai or Shenzhen Composites.
(d) 31-50% pullback. Investors start tossing quarterly statements in the trash. Despair sets in.
(e) 51-60% pullback. Investors in the oil sector have experienced this in the past nine months. I don’t know how they handle it.
(f) 61-70% pullback. Investors in the oils experiencing it today.
(g) 71-80% percent pullback. Investors in the mining sector know all about it. But then they’re used to it.
(h) 81-90% pullback. The last time this occurred in the broad indexes was the early 20th century.
Most of us have experienced (a) through (d), and need to decide where to place stops. I’m not expecting a crash on Monday (a snapback that ultimately fails is more likely), but neither would I rule one out.
Not sure if you bought but I grabbed a little aapl after hrs at 105.95
Delete(a) Near the close, I opened two small positions-> RYWVX (Rydex 2x Emerging Markets) and RYCVX (Rydex 2x DJIA). I closed FEMKX (Fidelity Emerging Markets) and opted instead for the leveraged Rydex fund b/c I want the flexibility of closing at the 1030 am window on Monday. Although EEM may see further downside on Monday, today's selling was pretty intense and already on the heels of a brutal multi-day decline. Ditto for the DJIA. So I hedged my bets. If we gap up Monday I'm good. If we gap down Monday I have room to add.
Delete(b) I also reopened a partial position in RYPMX (Rydex Precious Metals). It closed off -3%.
(c) Reopened a trading position in AAPL at 105-and-change.
(d) Took additional -3% hits on RYEIX + RYVIX. Margin calls accelerating the selloff in oils? No doubt.
So David-> Did you return from vacation holding positions in TZA and GDX?
ReplyDeleteThere's a distinct difference between a developing country and an emerging country, the latter is undeveloped and thus lacks infrastructure.
ReplyDelete"August 11, 2015
The Research Investment Committee believes weakness in China's economy by itself does not present a threat to the US, but emerging markets are likely to be affected."
CNBC apparently is doing another 1 hour special “Markets in Turmoil” on Sunday. The last time they did this was on 6/3/12 and we all know what happened after that.
ReplyDeleteWas out for dinner with my really bad investing friend and he was very bearish - said the world is in worse shape and higher risk than 2008. He insisted on making a bet (and we never bet) that the Dow would get below 15000 before the end of the year. He is a really good market tell for me as he is always jumping on trends right near the very end, so anecdotally, for me, a very good sign that the bottom is very close. He could be right on our bet and we do still get a big pullback soon, but another factor which makes me believe we end the year higher.
ReplyDeleteA Primary IV correction may be underway. ( https://caldaro.wordpress.com/ ) ... A Primary IV correction would suggest a decline back to the October 2014 lows around SPX 1821. If Primary IV is underway it should end with the largest percentage correction since 2011. All corrections in the SPX, since Primary II, have been limited to 10.4% or less.
ReplyDeleteAlso, some comments from Brandt on the complex HnS top. ... http://peterlbrandt.com/
I'm sitting with equal parts AAPL and RUSS heading into Monday, with 75% cash. After taking a hit this past month, I figured it would be a great time to go back and look at my mistakes over the years. I'm now sitting at about -15% this year, which stings pretty bad but I'm basically back to where I was last fall. Luckily my managed accounts are actually up about 5-7% (down from +25% a month ago). Literally every single mistake was the same this year and in years past: catching a falling knife or not selling some after a big move up. Every one of my big winners was when the stock had based over a significant period of time and began to show some signs of life either in the form of increased volume, moving above the 200DMA with a retest of it, or relative strength in the form of higher RSIs at equal lows. I studied each of these pretty closely:
ReplyDeleteREDF in fall 2010
YRCW in spring 2013
BALT in fall 2013
DGLY in summer 2014
LAKE in fall 2014
The only exceptions were NOK, FCAU, and SNE, all three of which were big caps that happened to be fundamental bargains on a sum of parts analysis, but they all had great entry points shortly after I bought them in 2012 / 2014, after they popped up above the 200 DMA and settled back into a basing pattern.
I'm using this info going forward to correct any mistakes and to prevent over trading. With the market now below the 200DMA, it's time to be as patient as possible. There's a chance this China / Russia stuff blows over and things get better. If that's the case, I am focusing on stocks that are coming back to their 200DMA but show very strong rev growth or have huge tailwinds behind them. On my list of ones to research more are:
FLML
AMAG
BSET
XENT
TCX
INUV
I also have TASR on my watch list as I think it's going to be very resilient now that they have a very strong SaaS business model that has huge tailwinds behind it (ie every police force is basically being pressured into using body cameras and therefore need digital backup storage to maintain all of their video camera evidence). I'd like to see it base out first.
My losses this past month include big hits on MMYT, SEDG, BITA, and PYPL. MMYT and BITA were perfect examples of buying falling knifes...great lessons in just waiting for a bottom to form. I used similarities from other internet stocks like CTRP and NTES as a basis for when to buy these two but in both similarities, I ignored the fact that both CTRP and NTES formed bottoms over a period of 3-6 months before breaking out again.
DeleteAnother mistake I made with these last few is focusing too much on fundamentals and thinking valuation had gotten low enough. That might be the case in the long term, but it would require holding on to positions that could go way underwater first, something I'm not mentally prepared for. Its better to couple the fundamentals with technicals and just wait for a clean setup. If I miss it then so be it, but there's tons of opportunities the majority of the time.
DeleteI figure with the market being so weak lately, it's a great time to stay in cash and analyze what has worked in the past and stay focused on that so as to avoid over trading etc.
I think the reality is pretty much everything has been hit hard the last while and while a few stocks are at their highs, many more are down 20% or more. So, anyone who isn't down probably has been in cash the last 6 years and not made any money on the way up either. Nice to avoid these takedowns, but very hard to do and I don't think anyone does it consistently.
ReplyDeleteI still think this correction is all about stocks coming to terms with a raising rates world. Stocks like the IBB types will fall out of favour as they are benchmarked against higher rates and I think large cap value does well, but it will be interesting to see who the actual leading stocks are out the other side.
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