Quicknote for Year End

I've been more awol than expected this week, and traveling again now today. As always, it is easy enough for me to update trades via Twitter, since it requires less time and energy vs. blogging. When I go missing here, I have so far kept up with updates over there.

I'm still holding a few smaller-cap longs (HMIN, CISG, HRBN and ULTA; 14% invested overall) and at this point expect to take them all into next week.

I did play several more, with the intention of selling by today. The year-end didn't work out so well, but no disasters either.

I don't like the idea of holding anything long into next week which has had an exceptionally strong 2009, as these have a tendency to sell-off early in the new year (historically). This was a mucky quarter for me (basically flat in a decent market), but the year over all was very strong; so I'm far from complaining.

Straight-up or straight down action next week would surprise me the least (and drama is possible in either direction). The common idea held of a short-term pullback early in the year is the scenario I agree with the least. I would argue we've had a pullback already, in most of the leadership names (although the NDX leaders did finish the year strong); so opening the new year and rallying strong from the get-go will make perfect sense; short-term.

Otherwise, I would be surprised to see early weakness, followed by strength; or if not straight-up, I would be wary of the potential for straight-down instead.

As always, we shall see. Keeping small here going into the year, so I can adapt easily.

Best luck in 20TEN!

Mavvy Christmas

Laying low, blog-wise (though I did a brief post at ES yesterday).

Mavericks is about to pump Santa. The Contest window is open and judging by the data, we're about 100 hours now from possibly 25 foot breaks; which would make this year's event well worth watching. I'm in SCal (unfortunately, since it means I can't get to Mavericks), and moving to the desert for the weekend and much of next week.

Cheers!

Quicknote on Action (chinese growth suspect)

The market indeed rocked higher, so I got that right.

Or wrong.

Chinese growth, where I accumulated most of my line, is acting poorly this week. Shanghai is at an almost two month low, down another 2.3% last night. So while US equities continue (so far) to fade the stronger Dollar and have worked back to highs, leadership growth in China is behaving a bit sick; especially in terms of relative strength.

Given that this has been the leadership in the market, it commands some attention. We might see strength in the China names between now and year end (cannot count out the strong seasonal period we're entering, unless/until it becomes clear the market is selling-off in spite of the calendar). But without renewed strength in the higher-growth Chinese plays listed in the US, I wont remain bullish for too long; China or elsewhere.

Total Position: ~3.5-to-1 net-long; 34% invested; Pure longs = 29%

Currently Long (according to size): CML (reduced today, 5.9%), AMZN (5.4%), HMIN (4.9%), CISG (4.1%), RINO (3.7%), HRBN (reduced today, 3%), ULTA (2.2%)

Currently Short (according to size): TWM-long (R2k Dbl-short, reduced today 5.1%)
(Note: inverse-ETF TWM represents being dbl-short the respective index)

Futures Accounts: No current position (see the Twittspitt for details)

Catalysts and Cattle Lists

Let's go ahead and say the least - this was a beast of a week in the markets. First let me say - I wasn't the first guy to turn bearish on stocks, but I do like my killing to be easy; especially since markets have a way of chop-dropping downward with greater velocity than they do in fact rise. So at the risk of refreshing my status to born again idiot, I will admit to you now I'm beginning to turn a lot like bullish.... More

Updated Position...

Total Position: 4.5-to-1 net-long; 45% invested; Pure longs = 39%

Currently Long (according to size): CML (9.3%), RINO (6.6%), HMIN (5.1%), CISG (4.3%), CAAS (reloaded today, 4.1%), HEAT (reloaded today, 3.9%), HRBN (3.8%), ULTA (2.1%)

Currently Short (according to size): TWM-long (R2k Dbl-short, reduced today 5.3%)
(Note: inverse-ETF TWM represents being dbl-short the respective index)

Futures Accounts: No current position (see the Twittspitt for details)

A Trader’s Guide to Hedging Strategies - Part III

A Trader’s Guide to Hedging Strategies - Part III posted earlier on ES Here.

The FOMC announcement is out and while the Fed is signaling the beginning of the end of zero-rate stimulus, the market's reaction is rather benign so far; while the VIX only continues to erode (down another 4% today). I've been scaling into a larger net-long position, although at this point I remain rather lightly positioned overall.

Total Position: 1.33-to-1 net-long, 34% invested

Currently Long (according to size): CML (increased today, 9%), HMIN (5.2%), RINO (4.3%), CISG (4.3%), HRBN (4.1%), ULTA (2.2%)

Currently Short (according to size): QID-long (NDX Dbl-short, reduced today 5.4%), AAPL (out for now, 0%)
(Note: inverse-ETF QID represents being dbl-short the respective index)

Futures Accounts: No current position (see the Twittspitt for details)

Updated Position

Total Position: 1.21-to-1 net-long, 45% invested

Currently Long (according to size): CML (7%), HMIN (5.2%), RINO (reduced by half today, 4.4%), CISG (4.3%), HRBN (4.1%), ULTA (reduced today, 2.3%)

Currently Short (according to size): QID-long (NDX Dbl-short, 7.5%), AAPL (10.5%)
(Note: inverse-ETF QID represents being dbl-short the respective index)

Futures Accounts: Short 10% Mar NDX future, from 1800.75

A Trader’s Guide to Hedging Strategies - Part II

A Trader’s Guide to Hedging Strategies - Part II
...just posted to ES Here.