Wild Week

Been a wild week.

Both my longs and shorts have been working.  I've been taking profit:

• Took profit on some shorts as they kept going down (precious, cyclicals).  I cover a bit on the day they breakdown.  Then sell down to my min one or 2 days later when they breakdown more. 

• Covered 1/2 of my Russell short after it dipped slightly on Thurs & Fri - its an overcrowded short which isn't going down enough.
• Stopped out Big Tech longs.  Now only 2 of the original Mag 7 left.
• Software longs went up a lot, took profits, position down to min.
• Added some shorts in private equity - but they turned against me Thursday.  These are my only short positions at a loss.  Its at a max position.

• VIX up to 19.

Looking to reload both sides when I get a chance.  If I get a chance:

Hard to know when a particular trade - or the market overall - is oversold or crashing.

Got Shorter

Wed morning 21st Oct, before market close.  Woke up and my shorts were up (against me), added some more.

Now filled around 3/4 of my max short position.

Sold Japanese SAAS Companies

My Japanese SAAS stocks were 2 cloud accounting companies: Freee (4478) and Money Forward (3994).  Got these ideas from Asian Century Stocks.  Since I bought them in Feb, they've been pushed up by good results, a buoyant Japanese stock market, and a recovery in software stocks being hurt by AI.

Sold them today.  Average over 40% gain in 8 months.  Supposed to sell Friday but busy at work.

Why did I sell?

• Market share data is hard to come by.  There is a big private competitor (need Japanese VPN), Yayoi, that has a large market share in legacy (desktop) accounting software.  They claim to have 560,000 active contracts (one or more users per contract) which is more than either Money Forward and Freee, and probably more than both.
• Both Freee and Money Forward are still in early growth stage, where PEs are not meaningful.  Price to sales.  The story is that they will grow profitable by converting greenfield users.  They may - recent growth figures have been good.
• I think we're at the end of the economic cycle, the current AI boom is ending.  Like 2001.  Stocks probably get hit, especially growth stocks.  I don't want to hold "Price to sales" stonks into a downturn.
• One of Hedgeye's signals for Japanese equities turned negative. last week  It was on a day that everything fell (Oct 15th), so it could be a false alarm.  But given everything else, now's a decent time to sell.

I may be missing out in two multi-year compounders.  But I also may be missing out on a market correction.

Quick Update

Earlier this week, got stopped out of some shorts and longs on Thursday's wild ride.

Sat Oct 17th. Woke up late this morning after mkt close.

• Q's down - the index is no longer holding up.
• Nvdia down - the AI king. 
• VIX spiked from 16 to 19.99 - fear is spreading to the big names that form the index.

‌This is a change in market tone. I want to be short. I expect the the economic cycle to turn down in 1Q27. Was wondering if we would get a blowoff top in the big caps, especially NVDA, but its looking less likely.

‌The market is oversold here. It can bounce Monday. Or crash.

‌Took small short positions in AI (data centers, private equity) after market close. Its 1/4 of my full short position. I want to increase those positions if we bounce, or if we drift along a 1 to 3 more days to work off the oversold conditions.


I want to get shorter. Lets see if I get a chance to increase those positions.

This is a good video of why the Nasdaq bull may have ended last week, starts at 1:15:

Covered the Bond shorts

Market open 14th Oct.  Covered yesterday's bond shorts on market open after the CPI release.  Made a small profit.  Not bad for one night.

Looking to load up on Big Tech and software longs.  But probably not today.

Pressing Shorts

Market open 13th Oct.  Got really short.

• Entered large position in Interest rate shorts (ie: expecting rates to rise).  Short term trade.
• Reduced crypto over the last few days.  Its getting less bullish.

Lets see how it goes.

I need to learn to trade options.

Quick Update

 Small changes:

• Sold Gold.  Look to buy it back in the coming months.
• Bought a little crypto earlier this week.  
• Cut short exposure a little.  Added a tiny amount to precious metals.
• Bought Big Tech today, plus some software.

Still just aiming to be short stuff going down and long stuff going up.  Hope the bifurcated market continues.  Probably get a chance to buy more and cover more shorts early next week.  Before reloading on the short side.

Gotten shorter

Market up for the past 5 nights, I added shorts, mostly in the last 2 days: interest rate sensitive sector, cyclicals, Europe and other countries which have lower growth than the US, and a few others:

My short trades (30%) are bigger than my long trades (10%) because:

• The trading shorts also offset the fundamental longs (around 45%).
• Narrow market breadth: even as indices risen, most stocks are falling.  Easier to find stuff to short.
• Market up for past 5 days.

Short term, I am near my max position size for most of the shorts.

My aims now:

• Keep shorting stuff thats going down on bounces.  Don't overthink it.  Preference for stuff that can still keep falling when economic growth, inflation and interest rates go down.
• Review all the individual fundamental picks, do I want to hold them into a bear market?
• Buy stuff thats still going up on dips.  Especially big tech.  Might get a 2001 blowoff top - this time its probably NVDIA which is sucking cash out of the rest of the ecosystem for their chiiiipsss....

Quick Update

Market up a lot in the past 2 days.  Took profit on some Big Tech, software and crypto.  Covered some shorts.  Then bought back the crypto end of Friday's session after it corrected.

Next week, look to take a little more profit, then Short more.  Prefer to short stuff that: even apart from high rates/oil, will do badly in a contracting economy.  I might still be short it 3 to 6 months later.

Quick Update

Just before market close Thurs 1st Oct US time.  Market up.  Sold Oil.  Added to my shorts in small increments:

Quick Update

Last 2 nights:

• Added some Big Tech longs.  Then took some profit.
• Cut some of the Crypto trades that weren't working last night.

Day-to-day many individual trades I'ver taken are too choppy.  I may consider:

• Take profit on individual trades sooner.  On extreme overbought/oversold.  Sell/cover half, leave the other half to run.
• Only trade the more liquid ETF.  Ignore ETFs and stocks with a high spread - only experienced traders should touch them.
• Position size by volatility.  Or simply only trade the lower beta ETFs.  eg: If I was trading gold, pick GLD instead of GDXJ.  Less likely to be shaken out.

Reframe what I am trying to do:

• Even through the market as a whole is unclear, there are clear trends.  Look at three month charts of bitcoin/ETH (up), Apple/MSFT/NVDA (up), XLU (down) or the Russell (down).
• I'm trying to jump on board the trends, at a safer place where I don't lose too much when the trend changes, and in a way that I won't get shaken out by noise.

Under current conditions - near the end of the economic cycle, with rising rates, fighting an oil-war in the mid-East - take smaller and safer trades.  Don't swing for the fences.

Portfolio down; Sold LATAM

Portfolio was down 1% last night: mostly from LATAM and gold.

I sold 2 of my LATAM positions.   These were longer term trades, or shorter term investments.  Bought several quarters ago as South America had upcoming elections expected to swing to the right.  Now thats behind us, the macro outlook for the next few quarters is bad, and the price action starting to reflect this.  They were cyclicals (banks), not buy-and-hold-forever stocks.  Took profits of 20% and 35%.

I need to think about the remaining LATAM position.  It fell due to stock specific factors, and the factors above are more balanced.

My new crypto position from last week is down a bit, I could buy more or cut loss.  If it does work out, I must remind myself to take some profits when overbought.  Crypto is really volatile.

Only consolation is that my short term trades, both long and short, are mostly working.  I may take some profit in oil if it keeps going up next few days.  Now 34% net cash.

This year has been tough for my account.  Up 9% YTD, but been through a grinding 9% drawdown in the past 7 months.  I remind myself that I've been through worse, a learning experience.  My trading style does not do well in non-trending markets.  Eventually the market will start trending again, probably to the downside - if it hasn't started already.  Need to be ready for that.

Bought some crypto

After falling one-and-a-half years, crypto broke out last month, I managed to buy a tiny bit.  It broke out again 2 weeks ago and corrected over the past few days, letting me buy bigly, up to a 6% position.  Lets see if it keeps going up.

Other than that, just made a few small trades:

• Managed to add to some shorts, and Europe, Russel, some rate sensitive.
• And to some longs: software, consumer, and refiners (long oil/refiners is that same as shorting the market).

No change over the weekend.  I had thought that Xi and Trump might come to some sort of deal.  For example, the US could allow Iranian oil to be sold to China, if Xi lifted the export ban on refined products.  Instead, the opposite may have happened.

And there was never any chance the Iran/US sides could reach a deal.

Expect the same as before.  Iran gets slowly strangled, as oil/product grinds higher, pulling most stocks down, even as mag7 and the indices rise.  Eventually the IRGC loses effectiveness and Hormuz gets fully restored.

Longer term, expecting a bear market next year.  Here is a good interview:

  

Neither here nor there

Added some shorts plus long oil at market last nite.

Its a mixed market.  Some sectors are going up, many down.  Short some stuff, long others.  It changes, with no overriding themes.

Probably looking to buy some crypto soon and cover some shorts.  Before flipping back to do the opposite a week or two later.

In the short term, rising oil/diesel is grinding almost everything else down through higher rate expectations.  In the long term, I think we are near the end of a multi-year boom.  Stay small, nimble, and don't get attached to anything.  Float like a butterfly.

Wait and See

We don't know how the market will go, so wait and see.

Everything depends on oil and Iran and Houthi news.  We could get a new war or a TACO tomorrow.  My base case is that the US continues to strangle Iran while the Houthis allow non-Saudi oil out.  Crude in the 90s. Inflation grinds up while the market grinds down.

I added some shorts (High Tech Beta) and some trades.   Not much change.

Waiting to add some gold, copper and rate-sensitive shorts.  We'll see if it haoppens.

Some Links

• US negotiates with Houthis.  Not a big deal, but theres scope for a quick deal.  The Houthis said they do not want to attack US interests, and will not attack Israeli vessels, or any commercial vessels apart from Saudi's.  Back-of-the-envelope its 3.5m bbl/day crude, with 1-1.5m of that re-routed through Suez - based on ships docking at Saudi terminals, not just Saudi flagged.  If this is true, we could see a quick deal between the US and Houthis, leaving the Saudis out in the cold.  

Options from here (not mutually exclusive): 

• Saudis rally the Sunni world against the Houthis after an alleged(?) drone attack on Mecca. 

• Saudi signs Abraham accords after their 'Mecca pact' proves useless. 

• US peace deal with Houthis.

Bab Al-Mandab closure is now being priced in, but may not be as bad as expected.  Geopol changes faster than macro.

• China passes mass mobilisation law.  For Great Reunification.  A day after they imposed travel bans on their citizens.

• Hedgeye talk with Mike Taylor: The AI bubble numbers are too big to make sense.

• Michael Every.  Economically, the US must become more like China, while China is not becoming more like the US - in a zero sum world.  Economic statecraft, US grand macro strategy and Brazil.

Sold stuff

It was a mistake buying gold (miners) on Fri, I have sold these down to a minimum position.  Kept only some Royal Gold.

Sold some trades.  Losers that I got stopped out of and winners that are overbought.

Separately I sold one of my speculative miners.  They sold their best producing asset a month ago, and the stock price went up but this removes the asymmetric upside.  Small profit.

Now 36% cash.

Rising oil/diesel kills everything.  Probably continues until Trump taps out or the IRGC is strangled and Iran breaks up.

Waiting for signs to buy.  Either golds or stocks.  Or maybe to short stocks/bonds on the next bounce.

Bought Gold

Bought Gold on Friday night.  But I may have been too early as oil went up and the market dropped on news of the Houthis capturing Bab El Mandeb.

Hard to know how this plays out for gold.  Its a risk-on asset, any hot war in the ME means they sell gold.  Rising oil/diesel increases the chance of rate hikes on Wed.  I don't think the Fed should increase rates - we've reached the stage where US govt debt cannot be paid off unless the dollar devalues, and increasing interest rates doesn't help cost-push inflation.  But they might do a token rate hike just for credibility.

Looks like higher inflation for a few months.  This is the IRGC's play to unseat Trump in the mid-terms.  Maybe the market picks up if Trump does a helicopter-dump of money on voters, but I haven't see any signs of it in the market yet.  And if it happens, gold goes up further :)

Still haven't found anything to buy, for the rest of my trades:

Sold more

Sold more gold after Wednesday night's bounce (before market open US Wed morning).  Next we have US CPI numbers (Sept 11th pre-market) and Warsh's decision to raise or hold (16th).  May buy some back after the CPI release.

Also finished selling Delfi, and some trades that didn't work out (Silver) later in the week.

Am now 20% cash.  Its not intentional, I don't like having so much cash in a bull market.  But I'm also expecting a bear market next year, so only want to enter short term trading positions.

Look for stuff to buy in the current dip.

Sold a little on the bounce

Gold and my portfolio corrected for 4 days before recovering last night.  Sold a little after the bounce because:

• I had too big a position.  It was 17%, excluding 2% silver.  And this is high-beta gold (miners and royalties), not low-beta pussy gold (GLD).  Now its around 14%.  Sometimes you think you can weather a drawdown till it slaps you in the face.
• A medium risk for the gold trade is the rising price of oil/diesel.  Rising inflation increases rate expectations.
• The US is trying to strangle Iran, who has an incentive to increase oil prices, possibly by kinetic action.  Gold trades as a risk-on asset, it fell throughout the war.
• A short term risk is Warsh's decision on the 16th.  I think the market is starting to price in a hike.  Gold either pops or drops that day.

Still think theres a 3/4th chance that gold continues trending upwards, from here and now.  I am bullish long term on gold as a neutral reserve currency, and as a hedge against governments inflating away their debts.  But I was sized too big.

Also got kicked out of some market broadening trades.  Small loss.

Separate from my trading, I sold half of Delfi, Indonesian chocolate manufacturer today.  Will probably sell the rest later:

• I've held it too long.  Over 5 years.  Its a cyclical that trades inversely to cocoa prices, not a compounder.  Its a perpetual value stock.
• Risk of cocoa prices continuing to rise next year from El Nino.
• Increasing Indonesian political risk.  Not the economic cycle, but degrading rule of law and institutions.  For example, they have stopped companies exporting commodities, offered immunity to money laundering charges to people buying government bonds, and replaced the central bank governor.  If things get worse, you could imagine them restricting dividend payouts by companies listed on foreign stock exchanges, for example.
• If we do get an El-Nino cocoa spike into next year, it might be worth buying back again then.

I'm now around 10% in cash.  Can buy a bit more, but I need to remind myself to relax and just take trades when I can.

I expect a bull market till the mid terms.  Bear in Dec or 1H27.  Looking forward to it.

Still a bull market

Not much change.  Sold some losers, ride the winners:

• Sold some things that didn't work out.  High beta tech, and EMs.
• Replaced them with things that are working: gold, copper, precious/industrial metals & healthcare.
• No changes to my fundamental picks.  The Japanese SAAS stocks, NICE Information Services and the LATAM banks have been rising nicely.

Still think its a bull market.  I am 100% invested so cannot take advantage of Friday night's drop.

My portfolio is up nicely, nearly 4% in the past month.  Lets see how long it goes on for.

Finished buying the dip

Finished buying the dip in the last 2 nights.

Last night I was really lucky to buy 3% gold stocks before market open, just before Bessent's news that he would buy 30 year bonds.  I bought because it was in the middle of Hedgeye's risk range- which is about the best opportunity you can get in a strong trend, the gold price was inching up, and FOMO:

Its overbought now, after the good news.  I should probably sell some, but its been so hard building a position that I wont.

Now 100% invested.  No cash.  No shorts.

I'm now a pig.  This bull market could last 1 or 2 quarters.  Lets see how it goes.

Bought the dip

Bought a little last night (too early), and a lot tonight:

• Big tech, Gold, commodities, high-beta tech, software, market breadth broadening.
• Sold a little of my healthcare stock.  It seems to go up when everything else goers down.

Am now 6-7% cash.

See if I get a chance to buy more tomorrow.

Still buying. Market overbought now.

I've been buying last week:

• Finally got a chance to buy some gold on Thursday night
• Bought some more ETFs expecting market breadth to expand
• Covered high-beta tech shorts.

The market is overbought right now, so used the chance to sell some trades that weren't working last night.  Try buying different things when the market corrects.  Theres a lot I could buy: more market breadth, commodities, software, high beta tech or EMs.  And my favourite: Gold.  Wait for dips to buy.  Probably wait 2-5 trading days.

Some of my fundamental picks shot up last week: the Japanese stocks and a South American bank.  Up 10-20%.

I remind myself not to get carried away with buying.  Bull market probably lasts 1-2 quarters.  Everything I buy now is a trade.

Its a Bull market!

Now betting on a bull market, I am buying whatever dips or is flat:

Gold looks like its bottomed.  After a 6 month correction.  I want to buy more miners or royalties but haven't had the chance.  The risks are that inflation expectations may rise next months (ie: less chance or rates dropping).  And gold now trades as a risk-on asset so is affected by the war.

Don't get carried away, the bull probably ends within 6 months.  And $100 oil could end everything sooner.

Quick Update

Positions still unchanged, except for "Shorts" and "Trades":

Been a good month:

• My two Japan SAAS stocks are up 30-50% since mid June.
• My LATAM stocks are up in the past 2 months

• Gas pipelines flat
• And my short term trades are working.  Made money shorting EWY and other tech stuff, covered most of it on the way down.  Cumulating in Situational Awareness being taken out by Citadel.

• Also made money buying interest rate sensitive plays, trading in and out.  

So far we've see a bifurcated market, AI and high-beta tech down, (non-AI) software and low-beta up.  The blast wind from the blowup.  Does it continue?  Might depend on if Citadel is unloading their new bargain basement AI stonks.

Once the bodies are carted out, we should go back to our regular programming.  Either:

• A bull market from a few months of rising US growth.
• Or a downward chop from the war.

I don't know what happens.  Just trade whats working till it doesn't.  And remember that cash is a position.

Quick Update. Float like a butterfly.

I am holding a lot of cash, and doing short term trades:

Everything depends on oil (or product) prices, which depends on whatever Trump does next.  I have no advantage in a flip-flop market, I make big money from Trends.  But not now.  No need for me to keep playing a losing game.

My base case is that both sides keep fighting, until one is worn down.  The US does not have any good options left, and the IRGC can be strangled by blockades.  The war could continue for 2 weeks or 2 months.  If it goes on, and real destruction starts to be priced in, Dubai stocks may be worth a look.  Not buying oil because of the flip-flop risk.

Notes:

• Sold some interest rate sensitive stocks and healthcare as they rose.  Taking profits quickly (several days to 2 weeks) in an uncertain market leave me less exposed when the trend changes.
• Bought Copper ETF and some other stocks.
• Sold bonds at a small loss, bond yields are higher.  But the above interest rate sensetive stocks are still working, I don't know why,
• Shorted high beta tech. 
• Crypto *might* be making a comeback.
• Avoided the tech crash on Thurs.
• Thurs was one of my best days from paper gains on my Gas Pipelines, as gas breaks out.

Both my longs and my shorts are working. Small trades.  Don't expect any trend to last.

Neither Here nor There

 Two scenarios for the medium term:

• Rising real GDP growth from Sept onwards, combined with stimulus for the mid-terms propels the market higher.  I want to be 100% long a rising market.  Buy the dips now, don't sell.  Being a pig made me a lot of money in 2024 and 2025.

• Rising crude or product prices derail real growth and hit market confidence.  We go back to our on-again off-again war.   Market chops, slightly downwards.  In this sort of market I want to cut exposure, both long and short.  No FOMO, have a comfortable cash cushion, let the world pass me by.  Only take trades heavily in my favour.  Swing trades, take some profit after a few days.  Any profit is a good profit.  Float like a butterfly.

I don't know which scenario happens.  Maybe some messy combination of both.

I have cut back on my trades and shorts, both cutting losses and taking profit.   Added a LATAM bank:

Lets see how it goes.

Another podcast abt the war

A different PoV from Anas Alhajji on Macrovoices.  He expects product (esp diesel) prices to rise, not crude:

• Oil market knows the war will drag on, even after the mid terms. 
• Iranian regime fractured: IRGC hardliners benefited greatly from sanctions.  These "rebel" factions benefit from Hormuz tolls.  Irans oil production increased substantially - in Feb 2026 Iran oil exports were highest since 2017. Hardliners benefit from prestige, control and money.  If everything goes back to normal, they lose everything.  They attacked ships and other countries to derail the negotiations.  The negotiating team does want to bring about a peace deal.
• Anas is not bullish on crude:
• During the crisis China reduced imports by 6m bpd, reducing price from 90s to 70s.  They did not draw down their inventory significantly: only 50m bbls.  Of the 6m:
• 800k-1m bpd was for filling their onshore inventory.  
• 1.5m for filling floating storage.  
• Banned exports of refined product (1m bpd decline in crude).
• A little declining consumption from declining growth.
• Significant domestic oil production increase.  
• Market was balanced at $75-85.
• So far decline in crude inventory levels has been is US & Japan SPRs, not commercial inventories.  This does not affect prices. 
• Only risk for a short term crude oil spike is Saudi/Houthi attacks - they had agreement where Saudi supported economy of Sanaa, while Houthis stopped attaching the Saudios.  It held well, but was broken.  May see attacks on ships in red sea (6m bbl/day - mostly Russian/Saudi oil).  4m bbls per day of Saudi crude at risk.   Would push prices way above $100.  Only for a short time as the Saudi/US response would be hard.  But a disruption is unlikely, they are likely to go back an agreement.
• US shale (light sweet) can produce gasoline but not diesel.
• SPR can only be refilled max 400k barrels a day.  Will not raise prices signifigantly.  China will not refill above $70.  SPR refilling creates a floor, but does not increase it.
• US refining sector running at 96-97% capacity, even if product demand recovers, they cannot take more crude inputs.
• Anas believes the US originally wanted Hormuz to be closed as a message to China:
• US wants "Energy Domination", both Trump and Biden want the US to supply energy to the world to make them dependent.  
• 75% of Helium comes from Qatar, that plant was destroyed in the beginning of the war, Bessent declared last month that semicon industry is returning to the US.  TW investment in Arizona, 150 bn, mis more than the revenues of Kuwait & Iraq for a year.  Asian energy prices rose more than US or Brent.  Giving their AI production problems.
• Straits closure hurts Asia/China more than the US.
• China weathered the storm well, but they cannot do it long term (eg: 1 more year).  China wants to help the US get out of the mess.
• But did not go according to US plan.  Bad execution.  Later when the US wanted the straits open, they cannot make the Iranians factions open it!  US does not have a problem with the Iranian negotiators.  Will it turn into a full scale conflict?  He believes it will not be a full scale war: they will attack the IRGC elements who attach the ships, not the regime, watch where the weapons and drones are coming from, and attack to weaken them substantially.  So the negotiations can continue.
• No one wants Iran to collapse, which would be a disaster (civil war, refugees).  Turkey wary of Kurds, Pakistan of Baloch.  
• Refined product is a problem, not crude:
• 3 refineries in Gulf (UAE, Kuwait, Saudi).  All their export of diesel and jet fuel is shut down.
• Trump released medium/sour crude from SPR for Asian refiners to produce diesel.
• Russian refining capacity lost to Ukranian drones (with US support).
• The US is now exporting products to countries they have never exported before.
• Most likely, will get rising diesel/gasoline prices, not crude.

Iran War and Consequences

Interesting interview with Michael Every on the Iran war and consequences: Kaos Theory episode 13

Hard to summarise the nuance, but the main points are:

• Base case is for middling peace till the mid-terms, war resumes afterwards.  But this could be disrupted anytime by a rogue IRGC commander with a few manpads.
• Saudis and regional countries are re-arming drones and interceptors, have a deal with Ukraine.
• Geopolitically, it would be a big loss for the US to just walk away from the middle east.  Harder to TACO.
• A realistic US victory means 1) Stop Iran from using uranium, they know where it is, monitor it and drop a tactical nuke if anyone goes near it 2) Keep the straits of Hormuz open 3) Bypass the straits, Saudis and UAE building alternative pipelines. 4) Stop Iran from rebuilding military capability by blockading them and cutting off belt-and-road links (eg: bridge bombing).
• No Iran regime change.  If it happens, its a lot later, after the above "victory" conditions and Iran gets choked a for few years.
• Israel is exhausted from fighting.  But the IRGC is an existential threat, they won't sleep at night until its gone.  Same with Hezbollah, Israel cannot accept peace with them.  Israeli election in Oct, Netanyahu is unpopular.  There is zero intersection between what the Israelis, US and IRGC need for a peace deal.
• Republicans win the Senate in mid terms, the House is a toss up.  If Trump doesn't win, he goes back to issuing Executive Orders on statecraft and foreign policy.  For the 2028 elections, one faction of the Republicans (Vance) and all the Democrats are isolationists.
• In the future, the US could create its own oil trading block: NAFTA + South America + UAE + a few more oil producers + Japan & South Korea (refiners).  Everyone else gets left out to die in the cold (Europe).

The key to everything is US disinflationary growth.

Covered most of my shorts

Covered most of my shorts at a small profit.  The market was overbought 2 days ago when news of the war hit, its not anymore.

I doubt the war will last, Trump cannot afford high oil prices into the mid terms. Cut my shorts on the dip,  as Trumpian news changes too fast.  

Cut most of my crypto and EM shorts, and all of my commodity shorts (mostly precious/industrial metals), and all the Mag7 shorts.

Will post my holdings tmr.

Update Monday 13 July before market open: My current holdings:

Cash includes cash from short positions.

Quick update. Short as hell.

 I am very short.  80% invested, 20% cash (excluding cash from shorts) and 41% short.

Green rows have new trades, black rows are unchanged:

• Sold the higher beta LATAM stock
• Added a few more longs, mostly rate sensitive.
• Shorted moar crypto.  And Mag 7.  And EMs.

We are in a short squeeze, which is starting to hurt, but I think its still part of a (probably) brief correction.  We'll see in the next 2 weeks - either my shorts make a lot of money, or I cut my losses.

Quick Update

 Made a few trades since the last update:

• Shorted some Mag7 stocks.  Unfortunately I shorted when they were oversold a few days ago, so the position has bounced into the red.  The addition of Marvell and SpaceX to the S&P500 and Nasdaq should squeeze out Mag 7 and result in selling pressure.
• Used last nights rebound to reload my MSTR short.
• Also increased positions in 'interest rate sensitive stocks' as they corrected a little yesterday.
• High-beta tech (longs) got kicked out.

If the market goes up tonight I may increase my Mag 7 shorts.

Only the last 3 rows here have changed:

After end-of-quarter window dressing tonight, I am bearish on the market for the next few weeks.

Market correction

 The correction is probably a buying opportunity:

• Have cut the EM shorts that were based on rising oil.
• I cut my Memory stocks before the correction, but only by 10%.  Bought it back on the first night of the correction.  Look to increase my memory holdings slightly.    I have to learn to trade around it cause its so volatile.  Daily 10% drops are normal.  And one day the bubble pops - probably not today.
• Sold off copper miners.  Another sector rolling over.
• Bought some lower beta stuff in other sectors.  Anything is lower beta then Memory stonks.
• Covered some crypto shorts last night, hope to reload.

I'm holding 30% net cash, with my fundamental plays (56%), and for short term trades, being long and short really high beta stuff like memory and crypto.

In the next few days/weeks I'd like to buy more Memory, plus lower beta stuff (as trades), and reshort crypto and EMs (the new short targets seem to be mostly oil exporters).  Longer term I'd like to buy gold royalties/miners, but no signal for this yet.

I've be too fast to buy into these past few corrections.  Need to earn to wait - when the market has a potential economic growth slowdown ahead, and VIX/VIXN are in the 20s or 30s, then wait 3 or 4 days into a correction for the market to fall before covering shorts and buying new longs.

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.