My portfolio is not the market. I am not just referring to the fact I am a shameless, card-carrying permabear and that my portfolio is the inverse of the market, because it isn’t. I am referring to its behavior in the context of general market circumstances.
There are times when the market is weak and my portfolio isn’t moving. This is terribly frustrating for me, and I’ll glare at my screen and say GO DOWN! although it never helps. There are also times, like in recent days, when no matter what the market does – – even when it’s very strong – – my portfolio is a total champ, even to the point of me having no idea why on earth I’m doing well in the face of a screamingly green market. Wednesday was particularly like this, even with my myriad screw-ups.
As Thursday’s trading day wound down, I was getting a very good feeling about what today, Friday, was going to be like. When I feel that strongly about the market, I basically shut myself off from it. I don’t look at any screens. I don’t look at any updates. If I’m near a screen that might have a chart or a quote on it, I avert my eyes, much as you would at a YWCA locker room where you heard Yellen might be changing into her gym clothes. I want to keep my mind blank.
Thus, when I woke up at 5 a.m. and trotted over my home office, I was eager to see what was happening. How pleased I was to see an entirely red screen of futures quotes, as the /ES took another cardiac arrest lunge lower.
It does, in fact, look an awful like an EKG, doesn’t it? It’s uncanny.
In fact, I’m thinking we’re in heart attack mode, wouldn’t you say?
One other curious tweak I’ve noticed is that the market LOOKS like it’s going to launch into bull mode at precisely midnight, and then it feels woozy, gets sweat, and then barfs all over the lapels of its blue rented tuxedo.
In point of fact, the small caps have been so weak that, incredibly, we are approaching the lowers of the Rolo Bottom of October 13th!
I will offer one more tidbit of excitement for my bearish brethren: we have broken the trendline anchored to the March 13 bottom. This isn’t a huge deal, but it’s good.
As I enter this trading day:
- 25 bearish equity positions (long puts)
- 1 bearish ETF position (QQQ puts I bought late yesterday which, unlike my other puts that have months and months of life, actually expires TODAY!)
- 16.2% cash, which I will probably deploy
So I wonder what kind of bailout they’re going to try THIS Sunday, huh?
