Iatrogenics comes to mind when viewing today’s tape. Last night, in a hurried panic, I sold SOXL in the after-hours, alongside NVDA — thinking both would trade lower. I ended up correct about NVDA — but SOXL made up much of its losses and rallied hard into the close. When referring to iatrogenics, it is the process of doing something just for the sake of doing it — thinking it’d be beneficial — when in fact it hurts you, or the patient.
Sometimes the best thing to do is nothing. But please observe my overall position so you can make a better assessment. I am repeatedly telling you this — because my hyperbole often gets in the way of my overall investment philosophy.
My trading account is 25% of my overall investable money. The balance is in my quant fund, which was up 32bps today and +1.26% for the week.
So my SOXL mishap was 5% of an account that was 25% of my total. These details make the difference between a winning strategy and a losing.
In the close, I had 15% cash in my trading account, with one hedge: SOXS. My other defensive positions, TMF and NUGT, seem to be doing well even with equity reflation. All in all, I consider my position to be good and I should make money if the market rallies next week.
If we head lower, which, admittedly, is my hunch, I’ll quickly sell some longs and add to my shorts.
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