Cut exposure

Drastically cut my trading exposure last night.  This week I'd been selling individual holdings as they went bearish, last night I cut a lot:

Why?

• Two spikes in VIX over the past 4 trading days:

VIX is still low compared to previous corrections.  But the spikes are too fast....intraday.

• Sector by sector turning bearish.  Last month Crypto.  Last week high beta tech and oil.  Last night mag7.
• *Possible* growth deceleration in July. 

Quick Update

Shot my load too early.  Was 100% invested Wednesday night, Thursday recovered, Friday the market got hammered:

High beta tech got hammered more:

Past Moves:

• I bought a little more midnight (mid-day) Friday, as my portfolio was down 2%.  It was down another 2% by close.  Now 105% long, 2% cash, 7% short.
• Covered my rate sensitive shorts on Friday.
• Hedgeye's ten year yield's trading risk range had 4 consecutive lower highs on Friday (based on Thursday's closing data).  

• After that (Friday), TLT did not fall when good employment data was released.  If high employment does not make interest rates go up, what will?  Covered my TLT short  and some other rate sensitive stuff.  We may be moving closer to buying gold.

Future Moves:

• Still think its a bull market.  Was going up to fast, everyone on the same side of the boat with too much leverage.  Needed a correction, someone got blown up.  The correction could go on for a few more days.  Or it could be a distant memory by middle of next week.

• But as we go out 3-6 weeks, I want to get more cautious.  Possible stagflation.

• Will probably cover my remaining shorts (EMs) on Monday, as they are down so much and the positions are too small to trim. Reshort on post-correction bounce.  I'll keep my MSTR short since its still sizeable and seems to be uncorrelated with the market, maybe add a little.

Quick Update

Last night (Wed night) was the first day of a correction:

• Bought some space related ETFs on market open.  They are correcting - could be because of the New Glen explosion, could be a sell-the-news event for SpaceX IPO (in which case I'll lose money).  But its a bull market, buy stuff thats going up till it stops.
• Also bought some other low quality techy/AI adjacent stuff.  Shit flies in a Quad 2 bull market.
• Bought a little IWM.
• MSTR is dropping like a rock, regardless of wether the market is up or down.  2 days ago they sold bitcoin to pay preferred stock dividends.  I have a good position.  Its falling so fast you can't even short it anymore (SEC uptick rule).  Good chance that bitcoin only recovers after Saylor is carried out in a body bag.
• Sold Google on a small bounce at open.  Small loss.  Its oversold, but Hedgeye risk range has 5 consecutive lower highs.  I don't know why its selling off on news of the Berkshire Hathaway's stake...stock down on good news --> get out.

My IWM and space-crap buying was a bit early, its down this morning.  I'm at 8-9% cash.  Want to buy base metals (incl. copper miners) and small caps, probably in the next 1-2 nights.  Enjoy the bull while it lasts.   "As long as the music is playing, you've got to get up and dance."

Bought Nice Information Services (030190 KS)

Bought a 5% position in Bought Nice Information Services (030190 KS), a credit bureau in Korea.  See the Asian Century Stocks writeup (paid).  Its sells mostly consumer credit scores, and is part of an oligopoly, with past 6% CAGR, trading at single digit PE.  It pays a 4% dividend, or half its profits.  The risks are: Korea is already heavily indebted, the corporate structure, and the stock is illiquid (buying 50 shares can move the price 1%).

Sold Nam Cheong

A Malysian OSV provider that went bankrupt 3 times.  I bought some in July 2024 and again in July 2025.

Name Cheong is a cyclical, not a long term compounder.  It has no moat.  

Trying to estimate their long term operating profit:

I get RM 30c per year, at the current utilisation rate is 58%. 

Increase utilisation to 70% and I get 50-55c per year.  At a maximum possible 85%, I get 80c.

The above does not take into account increased rates, which can push it up more.

The company should do well as the OSV cycle keeps improving.  We may be halfway through - we are nowhere near a the top of a bubble like 2008.  Although the easy money has been made, there's still some meat on the bone.  Main reason for selling is to buy something else.

Its up 3 times since I bought from my average price.  Been a good ride.

Quick Update

Think a correction may have started Friday night.  In a bull market, it probably only lasts 2-3 days.  I'm at 15% net cash now, look to buy Monday and Tues.   15% cash is too much in a bull market.

• Sold some Mag7 as they went up last night.  Before dropping into last night's close.
• Bought a few more "high beta tech" ETFs as they corrected Friday midnight.  Junky stuff really, but they can fly in a high growth and/or inflation environment.  
• Memory would be included in "high beta tech" above.  Already got a full position.
• Wanted to sell oil (Var Energi) but woke up 10 mins after the Oslo stock exchange closed.
• MSTR rose quite a bit Fri, now got a full short position.
• Long term bonds are overbought, re-shorted TLT.  They should bounce (down) now, but keep this on a short leash see if/when high rate expectations begin to falter. 
• Colombia has elections (tonight) Sunday: binary event, right or left.  One of my LATAM positions (2%) is a bet on this: it either flies or drops like a rock.

I would like to separate my trading and non-trading portfolios to measure performance separately, but in Interactive Brokers it affects the margin limits.  And I may want margin in years to come.

Separately I have:

• Created a LLM wiki knowledge base to hold topics from investment related articles.  Mostly fundamental related stuff.  Its to keep track of articles/topics over the years.  May write about it after I've used it a few months.  AI makes it possible to specify things in English that could not be done before.
• Been plotting Hedgeye's daily risk ranges onto charts, to be able to see trends and changes in trends easier.  Claude code makes scripting 10X faster.

Quick Update

 Short term trades:

• Portfolio up bigly on Tuesday, down medium last night.
• Some of my shorts did not work out, cut loss.
• Sold my crypto stonk at a small loss 2 nights ago.  Most of crypto is falling, BTC is dropping like a rock despite tech going up.  Last night shorted my favourite crypto PoS, MSTR.  Its falling so fast its hard to build a decent position. 
• Memory up 15% in Tues night.  I decided to keep it.  Its a bubble, but we don't know wether is 2001 or 1999.  The big question is when Korea/China increases capacity, or HBM demand from Mag7 fades.
• Small position in QTUM also up bigly.
• Added to some Mag7 positions, they are down over the past 2 days while everything else is up.
• Reshorting TLT.  Rising growth and inflation leads to higher rates.

Medium term:

• Looking for signs to buy gold, when rising rate expectations peak.  No sign of this yet.
• Cut my position in Var Energi from 4% to 2%, as WTI/Brent start to break Hedgeye's trend.  The market is pricing in an Iran resolution. 

Long term, conflicting views:

• US is in a growth phase now (mid-terms, tax stimulus, data centre buildout), but there's a chance it turns to stagflation in the next few months.
• Even if we get the growth, end 2026 is probably the peak.  2027 is a bear.