Category Archives: Defeat

Change of Plans

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Well, this sucks. Mr. Permabear is looking at numbers that would normally have him dancing on his desk. However, in a perverse twist of date, he has no positions at all, either long or short, and this is one of those days that will be permanently seared into his memory. FOMO has a basis after all. I’m missing out.

It would be foolish, I think, for me to clamor into shorts at this point, no matter how elegant the charts. Instead I think I will focus on those sectors which, until today, have been beaten to pieces (energy and precious metals) on the long side, but on a fairly small scale.

Suffice it to say that I hardly slept at all last night, and starting the first trading day of the year with my stomach tied up like a knot is hardly a propitious beginning. Below you can see where the ridiculous and logic-free Santa Clara rally died:

0104-es

Two Ways Of Hedging ATVI

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Our Current Number One Stock: Activision Blizzard

Activision Blizzard (ATVI), which just announced its purchase of King Digital (KING), the Dublin-based maker of the Candy Crush mobile gamecurrently has the highest potential return of any security in Portfolio Armors universe, at 20.8%. Potential return, in our terminology, is bullish estimate of how a security will perform over the next months. Below, we’ll explain how we calculate potential return, and then we’ll show a couple of ways of hedging ATVI.

How We Calculate Potential Return (more…)

The Spoilers Today

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What a crummy day for your beleaguered host!

The core problem, of course, was my idiotic refusal to accept the reality that if Gartman had turned bearish on crude oil, then the downturn was completely through. My portfolio is fairly heavily influenced by crude oil (in spite of me having no position in it directly), so the benefit that crude’s weakness had been giving me in recent days was totally ruined today. It was ugly.

Even worse, though, was what happened with small caps (to which likewise my portfolio is inversely correlated). Let’s take a glance at today’s action:

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Well THAT Was Stupid

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I am so furious at myself. And I don’t normally give Springheel Jack’s post so little time, but I had to get this off my chest.

Remember that terrific day I had yesterday thanks to energy? Well, it’s been completely unwound by a huge rally in crude oil. It’s like it never happened.

Well, that sucks, but why am I so mad at myself? Simple. I ignored the clearest, most important indicator ever, as shown below.

1028-cl

Now let me be stone cold clear here: I’m not trying to cute, clever, witty, funny, or snarky. I’m dead serious. I had before me the closest thing to a foolproof signal ever created in human existence, and I thought, “well, maybe it’s different this time.”

Shame on me. Shame. On. Me.