Investments Trade Log

[giskard]

Sold more weekly puts this morning on GDX and GDXJ. Gold blasted off again so going to guess they go unassigned. Tried to sell puts on GOLD, but Barrick went up 8.8% already today and my limit orders never hit.

[jennypenny]

I've seen some odd market maneuvers in my time, but the oil moves today ... negative contracts.

It gives a whole new meaning to the phrase 'peak oil.'

[jacob]

Crazy stuff. How soon until we see supertankers parked offshore again?

Add: nm, supertankers have already been recruited.

[Jason]

Somewhere, somehow the Koch brothers are minting money off of this.

[Lucky C]

I couldn't resist buying some SPY puts today (before oil went negative) because the past month's momentum has slowed down and because economic reality vs. stock market optimism seemed to be at an extreme. SPY got very close to positive 1-year return territory before failing today. The oil price crash is a sour start to the week.

If you want to get a little superstitious, but also recognize that market psychology tends to cause a bit of month-month mean reversion, note that it's also the start of a new month based on the first case of COVID-19 in the US. Check out this pattern!

1/20 - 2/19: Month starts with first case in US reported on 1/20, ends with the bull market peak on 2/19
2/20 - 3/20: Worst start to a bear market ever
3/23 - 4/17: Fed printing & V-shaped recovery hopes
4/20 - 5/20: Negative oil, lockdown protests, and economic data dashing hopes of a V-shaped recovery?...

[theanimal]

I put $2000 into UCO yesterday at $1.30. It went 20x overnight with the contract change. I'm debating whether to take out and take the quick profits as there may be a very good chance that this happens once more when the June contracts come up for expiration.

Edit:Well, they did a reverse split on the ETF and the trade wasn't executed to this morning. So I'm actually in the red. Lessons learned.

[George the original one]

Yay, The Psy-Fi Blog is back in action!

Deferral to experts is an understandable response to scary situations but whereas listening to the medical experts is a sensible strategy – because they’ll be actual experts with qualifications to show it – it is not an intelligent response to defer to people who have real expertise in anything other than talking persuasively – which is the stock in trade of most stock advisers and politicians.

http://www.psyfitec.com/

[jacob]

https://www.marketwatch.com/story/gold- ... 2020-04-22

BAC predicts gold at $3,000 by next year. I remember last time such predictions were made.

[Mister Imperceptible]

On this the ninetieth anniversary of The Great Crash weekend, I chant and dance in drunken ecstasy to INVOCATE the spirit of John Larry Kelly Jr.

Levered long gold, levered long volatility.

IACTA ALEA ESTO

My brokerage account is down 7% in one day.

I think this is the scene where Michael Burry starts screaming as he plays the drums.

An interesting test of my resolve

Good news is bad news for me.

Although in this bizarre world where bad news is good news because it means central bank easing, bad news is generally good news. Which means for me, bad news is good news is bad news. Until the bad news is really bad, in which case bad news is mistaken for good news and everyone missteps before realizing what terrible news it is, and that would be great news for me.

Infinity Candle

Risk capital account down 8.75% today.

Down 13.7% , or 0.36 years of living expenses, since quadrupling leverage on 20191025.

Down 10.85% today, the worst one day performance yet. Down 21.6% since 20191025, the steepest drawdown yet.

Deepest drawdown 12Feb2020: -48%

6 month return as of 25Apr2020: +252%

Largest single day gain on 16Mar2020: +83%

[Seppia]

Well that’s pretty awesome.

[IlliniDave]

In my little Roth I moved some cash from a recent conversion into a value factor ETF and into an energy sector fund, about $4K total. I can't get over my contrarian nature, I guess.

[thedollar]

Considering if now is the window to sell before a larger downturn hits. What are you guys doing atm?

[Mister Imperceptible]

@seppia @bigato Thanks!

Howard Marks recently said “The stock market is down 15% from all-time highs. The world seems more than 15% screwed up right now.”

US market cap to GDP was at a record 158% in February. If the numerator is down 16% to 133, and GDP is down 40% to 60, than at 133/60 the US market cap to GDP is at 221%. Which means the SP500 at 2836 in April is even more hypervalued than it was at 3386 in February.

Of course, anyone who stayed in cash post-2008 based on “fundamentals” would not have been wrong if the market were based on fundamentals alone. The question is do you think central bank support is actually stimulus, or just palliative care at this point.

In Weimar Germany, and more recently Venezuela, the nominal price of stocks went way up. How committed is the US government to making this a third world country? I do not know from my place in the cheap seats, so I have OTM GDXJ calls if there is a superabundance of liquidity and OTM SPY puts for debt deflation black hole spaghettification.

In between those derivatives I have a large position in the miners.

Long OTM GDXJ calls, OTM SPY puts, SIL, SILJ, SGDM, SGDJ, and a lot of miners via participation in actively managed funds.

https://m.youtube.com/watch?v=ebmwYqoUp44

https://m.youtube.com/watch?v=HbsPgGpfKpU

[giskard]

In Weimar Germany, and more recently Venezuela, the nominal price of stocks went way up. How committed is the US government to making this a third world country? I do not know from my place in the cheap seats, so I have OTM GDXJ calls if there is a superabundance of liquidity and OTM SPY puts for debt deflation black hole spaghettification.

In between those derivatives I have a large position in the miners.

Long OTM GDXJ calls, OTM SPY puts, SIL, SILJ, SGDM, SGDJ, and a lot of miners via participation in actively managed funds.

First off, nice work on your returns!

As to your current positions - I also have a large long position in the miners too but directly with no leverage. The reason is because I think we could get a spike, or a market crash (and all equities drop), or deflation or anything in between, or we could just grind sideways. Not feeling good about timing but I mean I think everyone can tell where the price of hard assets and gold is going eventually.

Are you doing a pretty long dated expiry on your GDXJ calls? I was tempted to do something similar but I don't even know if Jan 2021 contracts are far enough out.

[Mister Imperceptible]

GDXJ Jan 2021
SPY Dec 2021

Looks to me like volatility is mispriced again, albeit to a lesser degree than 2 months ago. There is only really one trade at this point, and it’s liquidity. $260 trillion in global debt imploding, so that’s why the Fed progressed from $500 billion to $700 billion to $1 trillion to “F#%k it, QE INFINITY.” Not enough liquidity and even the miners sell off with everything else, despite the wonderful fundamentals (increasing price of gold, collapsing energy input costs, current pricing as if $1400 gold instead of $1700 gold because institutional investors are allergic to “unorthodox” allocations to gold miners). Enough liquidity and the miners will go beserk (and Boeing and Carnival and junk bonds appreciate on hopium). The entire mining sector currently has a lower market cap than Amazon.

On March 16 I realized gains on puts when the VIX hit 80 and used all of the proceeds to buy miners which have since roared from the day I bought them. Over the last week as the broad market struggled to meaningfully pass a 50% Fibonacci retracement from the March low and the VIX stalled at 40 I took gains on the miners and bought another slug of SPY puts. In the last month realized volatility has been around 60 so an implied volatility of 40 actually looks cheap in this environment. If the VIX hits 80 again I will just make 2x instead of 5x or 10x.

I have held all of the GDXJ calls I bought in October and November and plan to continue holding until the miner valuations acknowledge at least the paper price of metal.

I cannot time anything or sit in the room when J Powell, House of Rothschild et al determine how much currency debasement is required to make themselves whole and when they will do it, so I just have to identify the mispricings and wait for collapse or supernova. Every time the VIX hits 80 I will sell my puts again and buy back more miners at presumably cheaper prices.

Aha Aha, Money Printer Go Brrr

https://m.youtube.com/watch?v=KiOv5HZwyxQ

[Seppia]

The way I’m wired doesn’t allow me to trade as you do, but I have been acting on similar observations, just a lot more slowly and gradually.
For example, as much as I feel terrible about it, I bought a lot of big tobacco* throughout the last year (bat is now my largest single holding, excluding indexes), I have started to buy a tiny bit of Rio (I wanted a miner that 1- had low debt and 2- had no coal), and have upped my cash reserves.
I invested about half my investable** cash reserves on the way down, maybe a bit early but I have a fairly large bonus hitting in a few days that will basically replenish 2/3 of what I’ve invested.

So I see most of your points but could never bring myself to do what you do.

*my inflation/defensive play
** not counting the 12-18 months cash cushion.

[giskard]

GDXJ Jan 2021
SPY Dec 2021

Nice those are fair points, I agree with you. They are probably still mis-priced just on energy costs & current gold price without even taking into account the anticipated price increase in gold.

I put in some limit orders below current bids for some GDX and GDXJ Jan 2021 calls, I'll just wait and see if any of them move enough to get filled.

Other trades today:

Sold some puts on SAND today. Sold some calls on WORK.

[Lucky C]

I bet against SPY a little bit more (September and December puts, as always only a small % of my net worth since it is usually not a good idea to do this). Smart investors and important data all seem to be pointing toward lower prices ahead, and soon.

Simply reaching last month's lows would be about a 22% drop whereas a 22% gain would put the S&P500 at new highs over 3500. I think it's safe to say that this is not a time when the probability distribution of the stock market return over the next year is a bell curve with mean of 10% and standard deviation of 15%. Beware the fat left tail!

[IlliniDave]

I'm hanging in there about 4% down for the year--net of contributions--so investment return has probably been around 3% lower. Still dribbling some money back into equities in sort of a rebalance with a long time lag. Like many, I'm certain we are not in the clear yet, and it's possible the worst is yet to come.

[jacob]

Nasdaq is taking damage. I'm thinking this is just [traders] taking gains out and plowing them back into the Dow thinking that things are returning to normal.