I just got done reading some of my posts from Sept-Oct of 2011, just to see where my head was at. If you recall, that was the Euro-crisis era, when the markets were collapsing and Zerohedge was feeling his oats. I lost a considerable amount of money during that correction, broadsided by WNR dropping from $17-11. I believe it was a 30% weighted position.
Some of the things I learned when reading those blogs is this:
I was and I guess still am an arrogant prick. I can’t believe the sort of behavior demonstrated in those missives. I promise you, The Real Fly isn’t nearly as obtuse and obnoxious in real life. Something happens to me when I get behind the keyboard. I transform into a demon and a stream of consciousness spills onto the internets. I can write a 1,000 word blog in under 5 minutes. I never edit them and rarely think twice about what I write. That’s why, every so often, a complete jackass appears on the site before you.
Secondly, after getting smashed about in longs, I restructured around WNR and GSVC (protect the head strategy) and opened a series of short positions, as well as raising a large cash position. That’s exactly what I might do here, but only after a bounce.
I love me some four horsemen of financial death (WDAY, SPLK, FEYE and YELP); however, I am in this game to win and my losses of 23% is clearly a steep wall to climb. Keep in mind, total drawdown over the past month stands at around 37%, patently absurd.
The only way I get back in this game is to trade with agility, do it perfectly, and hopefully get lucky. Luck certainly plays a role when investing. It’s important to put yourself in a position to get lucky, however.
Futures are exactly flat, which probably means a catastrophic opening on the opening tick.
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The fly is hog.
Mister Fly ,
Can you please tell me if you are still considering opening the gates of the ppt on a trial offer for the uncircumcised, I mean the unwashed?
JEW
Don’t make fun of religions. Everyone who belongs to a religion is a god damned idiot. Pun intended.
That’s right Fly, and those who worship themselves are the smart ones. Keep shining your own butt so you can kiss it.
I don’t know who/what burned you in the religious world, but I would be curious to know where your bitterness comes from.
Science
We were afraid of server issues, since traffic is through the roof. I will likely do it from Friday night to Sunday, off market hours.
FLY, you are thinking straight again. Good to see it….god knows you’ve set me straight when i was on tilt…or tried to.
Anyway, we go down the rest of this week….we bounce for a week more than likely two, and then we decline more than 10% as we near May.
We aren’t going to make new highs on the upcoming bounce, but you could get $75 on yelp and something similar on the others.
Best of luck to you….if you miss the big decline, you won’t be far off the S&P on a relative basis.
1 if we get a correction in May, SPY is at new highs by years end. Only China scares me.
I meant 1
Nice post. That was a crazy time indeed. I am torn as to what the markets do from here in the short term but a Ben less fed will hurt the markets for a while I believe. Doesn’t matter if the economy gradually improves. The animal spirits will dissipate slowly. Traders will get chewed up by the ups and downs but ultimately by the end of 2015 we will be sub 1500
Did you say you were “torn”?
lol. You’re an idiot, sir.
What’s up real fly
Fly, the tweet someone sent you about $NUS is interesting solely because I was just looking at that chart the other day.
I think NUS goes back to $150 too.
Indued
That draw down number took my breath away. You have never been a good protector of capital for as long as I have been reading your blog. However, during good markets you kill it for months only to get destroyed in days. This Fly is the painful unfair game of the markets where poor timing decisions can take you out of the game. The crow eating is not over just yet so continue to be on guard.
My Beta is always too high, which is why I will never attract Bill Ackman type money. However, I am usually infinitely better than this. I must admit to being broadsided again, long the four horsemen into the death camp.
Normally its in more of a down-market…..i think thats what makes this one a bit unusual. But, its not just you thats experiencing it obviously.
More importantly, it may still end up being a down market soon enough. That will make everyone’s drawdown seem “normal and unavoidable.”
The only thing I will say to rebut you is that this correction is simply a supply/demand thing, none of which is based on business.
Theoretically, every single momo stock should trade back to new highs, once this settles.
Well i have no idea, obviously. But the valuations on some of these companies have been kind of crazy. I would feel better about the certainty of a cyclical FTK play than a definitive return to the recent valuations on these MOMO names.
But, on the other hand, i would never have believed YELP would be worth $7B in the first place (on current financials).
If i had to guess, you are probably roughly correct, but i would say its even odds on much lower prices first.
I hope you get a huge bounce in the meantime….that seems pretty likely.
I’m disappointed by this comment section. Where are all the drunks?
Wait for the MEDICAL DOCTORS to arrive.
LOL!!!
Don’t count on a bounce tomorrow. In other words, get some protection asap. Sounds like you’re getting your head in the right place – have you actually looked at your P&L (it takes guts to click on it, & more to look!), or just estimating??
estimating still.
Sir Fly, how did you handle WNR? Did you keep holding?
I averaged down like a lunatic at $11-12, made it a 40% holding and rode the wave up. I sold my last piece around $30.
Nice. I intend to do the same with FEYE. Holding puts now but won’t add a share until sub 45. The growth prospects of the four horsemen is too strong. I believe we will see new highs this year. Thanks for your input.
Jules. There is a slight difference in the stake in the ground Fly picks of old. Most were deep value and a couple were depressed price high growth.
Ftk was teetering on bankruptcy. Hardly deep value.
Apologies for giving any opinion on your trades. Jules seemed not to remember the WNR trade. Then i flamed out with unneeded and unwarranted advice. Like a fucking idiot. Never again.
Don’t change. The lack of a filter is what cracks me up. Good luck. Been there. It wasn’t pretty but it all has a way of working out.
Let’s not forget my 2009-2010 crisis, dealing with big drawdown in FTK, buying as low as $1
https://ibankcoin.com/flyblog/2009/12/29/fly-buy-cmi-ftk-sd-coco/
I’d buy a hardcover book that simply consists of all your posts from day 1.
iBankCoin Community:
Did you curse me earlier when my YELP prediction of 70 missed by a mere 40 cents? Do you scoff at missing a target by 40 cents when I made the prediction $6 lower? YELP will be at 70 tomorrow, which was my original prediction last week. Go back and looksie for yourself. Still angry? Fine, I share more of my vision quests with you that make you a big ton of Yen. (For you merica-centric hillbiliies, the yen in currency YELP now takes from Japanese mom and pops who serve Toyko and Kyoto hipsters. YELP shall rally.
Anywho, earnings season is now upon us. I have smoked a ton of opiates and I present…
RONG XU’S EARNINGS FORETELLINGS:
4-15 YHOO – leaning short
4-16 GOOG – buy
4-17 GS – strong buy
4-21 NFLX, AMZN, TWTR, and UAL are all confusing to me, but should faded no matter the direction.
4-23 AAPL – buy
4-23 FB – buy
4-24 GIGM – buy, P – short
4-28 BWLD – strong short, YELP – ARE YOU PAYING ATTENTION? SUPER BUY!
4-29 LOGM – strong short, EBAY – leaning short
5-5 ATVI – short
Sincerely,
Rong Xu
your prediction was until Wednesday if I recall. YELP is my favourite stock in the market right now. Good luck Rong Xu.
You heard it here first folks:
RONG XU, messenger of the one and only Cai Shen, has upgraded YELP to a “Super Buy.”- price target is just $70, however (a few measly points from here)
No fighting in the war room!
Nice Buck Turgidson reference.
Fly, its been 5 years or so and I still enjoy reading your drivel
and yes i’m still here. shorting shitty stocks and buying margin calls!!
crazy cuz wnr and gsvc still in my core holdings for last 3 years
and as you stated eralie bears are the the smartest and true men
Fly.. how come you never take the approach of “screw the past as of now this is what the value of my current holdings are”.. And perhaps cash out and play alternative names if warranted??
For instance, it’s my opinion FEYE is too dangerous here for you (or anyone) to continue to hold: it could drop to $45 in a matter of days. Why not cash out and put your money on something less risky, that can still bounce?
That makes no sense. The risk reward now for FEYE is skewed to the upside. The only proper time to have cut FEYE was when he was initially say 8-10% down on it. Not 40% or whatever he is.
Dyer
I am actually a huge advocate of what you just said. It’s not where you bought the stock, but where you think they are going.
The reason why I am still in these stocks is because I do believe they will trade materially higher. When I said these were “the very best stocks” I meant it.
.
… dare I recite perhaps the oldest and best “Market Axioms” ever uttered …
—–
The Market Can Remain Irrational Longer Than You Can Remain Solvent !!!
~ John Maynard Keynes ~
.
At the end of the day, foot care is of the utmost importance….this is especially true when the market is at its most stressful.
.
… I have become a BIG believer in pedicures !
Just sayin’
.
Wtf?
Alright a Podiatrist! How relatively obscure. Congratulations on your degree good Dr.
Yours,
Dr. Muppet
Top of the morning to you, Dr. Muppet.
Hope you are certified, do surgery, on a major carrier list, and affiliated with a hospital because 0care is going to screw you.
My brother is a podiatrist and after 5 years of declining medicare revenue, increased administrative expenses, joke reporting and auditing decided to chuck a solid 30 year podiatry practice.
I have a word for you: Palladium
Dude, when it comes to trading, I think you’re about as honest as it gets. Besides the endless entertainment, you call shit as you see it and regardless of if it’s right or wrong, you work it all out with the critics and naysayers watching. Balls of steel.
Y’know, I kind of miss the old disclaimers. Just remember, if you update your blog post because of this comment, your steel balls may revert to lambskin and be susceptible to a good kicking from the market. And, you may lose money.
Another reason you’ve gotten so fucked is that SPLK, WDAY, & YELP are insanely correlated to each other – there’s no point owning all 3? It’s like 1 large position in geeks from San Francisco!
I learned that after the fact
Yeah, I guess that’s the last thing someone thinks about when they’re all making money.
yet they all aren’t making money
Making money doesn’t dictate where a stock goes.
.
… someone said the other day “they are ALL the same daily chart” !
So true … “synchronized swimming” !!!
Or, “synchronized drowning” … might be more accurate !
.
Fly, are you lying?
23% hit is not a big thing. you can trade/buy goog, pcln, amzn and other gems on this fall (or) you can even buy/trade v, ma, axp to get that 10% back and leaving 13% to losses which is not a big loss either.
So you are down big like buying $splk at 100 and down 40% and same with other stocks (or) you have lost ur mind crying daily over 23%loss.
In my world -23% is catastrophic. I need to make 50% to break even.
30%
First time posting but have been reading since 08.
I’ve ridden the bull market in a similar fashion to you. I’ve been long and strong for most of the last 5 years and feel I’ve traveled the same road as you.
I returned 100% last year doing the same reckless trading as you and I’m now down 20% for the year. I had a 50% drawdown in during the summer of 2011 and almost lost my sanity.
I feel like an idiot but I remind myself that this is all part of the painful game we all play.
You are the most honest blogger out there. Twitter is full of frauds selling their worthless subscriptions. I come to you when I feel like I want to quit this. You are a reminder that even the best traders make mistakes and lose.
Good luck to you and I hope you make it all back.
Thanks
Is that 23% of your whole hoard?
Holy crap!
Yes
Hey, it’s only clients’ money, yo!
Not quite!
Fly, long time reader first time poster. I blog at evilspeculator dot com and I read your blog most days. I’ve been in awe of your performance over the last few years and you should not be disheartened by the last few days. You have enormous balls.
Evil
I stop by your shoppe from time to time. Fine blog.
sad sad
you sound scared? not the fly i remember
The good people of Europe do not seem to give a fuck tonight. Currently green after a kamakazee dive in the Nikkei.
u need to integrate futures or index etf into portfolio to get a sense of market direction.
Also you need a business plan. if you have one, you arent following it. A 23% drawdown should close the account for the sake of yourself and your clients.
right now i think the biggest rats r leaving the ship.(they are the first ones to know its sinking) i see it, thou i might be wrong,as for the people who believe in god being idiots, sir isac newton was one. i believe we are in birthing pains. fly u say things about god ? but have you read his whole book. surly you must have to give a critique as you have or are you commenting on something you dont have all the facts on? assumption will damn you. …hey on the brighter side i just saw the movie” GODS NOT DEAD” was right up your alley …hope you go to see it ,if only to prove your point.
buy some coal stocks, lol, imho, the solar play was one huge hedged postion, short coal, long solar, now imho, it’s being reversed, as long as ute’s rise, imho ur good to go
25/40/50 percent drawdowns, are you guys crazy or what!? I haven’t don’t that since I was 22 years old. Even 10% in crash of 08 was unbearable, and I finished up more than 100% that year, ending year with 8 figure personal account. Although it’s happened before and may happen again, there is no guarantee you will always make these losses back in meaningful time frame. But I hope you do. Buy some safer assets and trade with a lesser base and keep your sanity.
Futies all up…lets see where she goes
I told u fuckbois that STZ would chop dicks off this morning, where dat cray batch nymph at? She prob got short stz after my earnings call and now is lookin for some prosthetic titties
Fly, this place is filthy. please make money soon so you can rehire the butler and have him sweep this place out.
The third paragraph of this post is why you are the only finance writer I read with any regularity.
” I promise you, The Real Fly isn’t nearly as obtuse and obnoxious in real life. ”
~ Bullshit
Where Munch?