BEHOLD: The January Effect

I’m busy this morning reshuffling my portfolio. What you need to watch is crude, crude stocks, HYG, SRLN and also IWM — because weakness in small caps have nothing to do with China.

The opening decline is severe and often times these gaps lower lead to buying. I cannot say with any degree of certainty that this dip will be bought.

In the meantime, it’s important to note we’re at the top of a downward channel.

Observe.

5,800 is in the cross-hairs.

As many of you fuckers know, 75% of my money is managed quantitatively, a method that was very pretty and beautiful during the halcyon days of when the bull market roared, but ended up being mechanized ribald in the bear. For the past 3 months of the year, all of my gains, AND MORE, have been washed from my account. The net results for 2018 was a loss of 8.6%.

Jan: +6.1%
Feb: -6.13%
March: +0.5%
April: +1.04%
May: +4.5%
June: -0.41%
July: +2.25%
August +4.4%
September -1.08%
October -10%
November +2.79%
December -10.5%

Total return for 2018: -8.6%

In comparison to what stocks did for 2018, this was in line with most investment strategies.

My trading account faired far better. Much of these gains were enjoyed during the summer months, especially during my winning streaks of 28 for 31 and 31 for 34. Net net, I had a profitable 2018 and have made adjustments to the Quant strategy to protect against further downside in the broader markets. The details of this plan, AND MORE, are in the Exodus blog now.

My methodology going forward is to be more defensive in the Quant and more aggressive with my discretionary account. I’ve been catacombed in cash for the past 3 months, placing small bets which have, more or less, resulted in marginal returns. A lot of circle jerking, if I can say so myself.

Over in my other service, The Capstone Programme, I intend to review long term portfolios for January. If interested in an annual plan, the discount code INDEUD will be effective for approximately 1 day.

Starting tomorrow, I expect markets to set a tone early on and I will attempt to position aggressively, either long or short. Market price action will be my guiding star.

You wouldn’t know it by my daily commentary, but 2018 was a dreadful year for Le Fly. Professionally, I’m fine and will always be fine. My genetic make up ensures that I thrive and continue heading higher. But life has a way of surprise raping you when you least expect it — which is why it’s called a surprise in the first place.

My best friend growing up killed himself and a very close family relative of mine was diagnosed with brain cancer. These are the two things that placed a shroud of melancholy on my year. I am grateful for my health and the people who love me — but it’s very hard to walk the black dog sometimes. I am prone to brood, often disappointed and infrequently pleased with outcomes.

Life marches on, with or without me. The things I hate the most sometimes become endearing to me, such as downward spiraling stocks and political upheaval. I’ve concluded long ago that I enjoy chaos and function best inside a razing fire.

One of my goals for 2019 is to help others manage their affairs better, specifically people from the interwebs. You rarely disappoint me and I love the banter, the back and forth between total strangers, whizzing throughout the trading day with zero fucks given. Who would’ve thought I’d give up managing money in real life for The Pelican Room, filled with drug addicts and gluttons for pain?

For this evening, as always, I’ll be at home with the family. I’ll eat a rib roast and consume wanton amounts of champagne. I don’t drink pretentious champagne, just Moet — because it’s dry and wonderful. I’ll make a lot of noise and play music loudly, and then sink into the couch and watch teevee. I’ll be dressed to the nines, clean shaven, and polished — optimistically welcoming in another year that might be filled with incomparable glory and winship — because I’m aspirational and want the best out of life.

Don’t we all?

Happy New Year’s everyone and thanks for reading.

I am going to do a wrap up post later on today — because I have some things I’d like to say and discuss. This is going to be a quick post, as I am busy with Capstone appointments all morning and afternoon.

BTW: We’re running a New Year’s Eve special today for annual Capstone plans. Use discount code INDEUD at checkout.

All of my positions are smartly higher today, even though I’m short and even though I’m also long. My shorts are up and my longs are up. Quite literally, I cannot be stopped.

Where am I most horrendously bearish?

Oil and RE.

My top positions there are DRV, NUGT, TLT and DRIP. Those 4 stocks represent 40% of my trading account. This never gets boring or old — because the mysteries and the intrigue are in a constant state of flux.

Be back a little bit later.

God damned it — I’m angry for no reason at all. I just made some sweet and sour chicken, which is basically lots of sugar and chicken. I must admit, being a top tier chef, such as myself, makes one into a top tier barrel ass. For 2019, I will be eating like a smaller man, heading back to the gym with great alacrity, and avoiding the pitfalls of good tasting foods.

I’ve recently gained 10 pounds, which would be fine if said poundage was, in fact, pure muscle. Then I’d be able to walk around, menacing people with my might, punching holes through concrete walls and bending iron beams with my forearms. Instead, I’m typing fast as shit into a keyboard, virtually hanging out with morons, whilst eating sugar cubes of fried chicken.

Something needs to change.

On the issue of stocks — believe me — futures are sharply higher. But no one gives a shit. The Champagne is getting chilled and the degenerates are preparing to partake in grande displays of hedonism for the New Year’s. Enjoy it while you can, faggots, for this time next year you’ll be on the ass-end of a soup line gawking at tumbleweeds rolling by the dustbowl, as America is seized by the Greatest Depression Ever, believe me.

Leave your top picks in the comments section.

Dismissed.

I can boldly and flatly tell you here that I believe markets will crack asunder, very soon, and very fast, providing Wall Street with ample blood letting from the undistinguished advisory community, parasitic faineantise with vicious eyes and wet mouths.

Truth is, I’d be foretelling something that may or may not come true. We have our probabilities and our little models, systems that make us feel better at night — to make us think we have it all figured out. But it’s all bullshit. The winds of war and famine destroy almost everything over time and men resort to their most basic primal form, after the pageantry of enlightenment ends and morsels of food become scarce.

Your models and ideas mean nothing in real time when standard deviations blow out. Understand that? When something happens that has never happened before, all of your learned experience is valueless. You will need to depend upon instinct and disciplines to prevent falling into an endlessly deep crevasse.

Number one: invest in your business. Subscribe to great services like Briefing.com, RiskAlyze and of course Exodus.

If you need one and one guidance and value my opinions, book a Capstone appointment now (extra shill).

Don’t just sit there stupidly and faintly fading into irrelevancy. Some of you inherited better than average DNA, which allowed you to access the very best schools and set you on a solid career path. But you’re still not happy — because one can always do better, make more. Am I right?

The majority of you hail from ordinary DNA, blue collared parents who toiled and slaved over hot stoves, shoveled gruel into your gobs and signed you up for baseball and soccer, took you to Disney, and kept your spirits high, made you believe you too could become President.

(pause)

Both of you are here now reading, hoping for some insight into the never-ending quest for happiness. You think it’s found with success and more money. Those of you who have money know that’s not the case. Once you have the money, there’s always more to attain — things to buy, private jets to maintain.

I’m not a fucking psychologist and cannot make you feel better. But what I do know is behavior and mistakes people make when investing. Much of your unhappiness stems from the desire to get rich quick. You read about fuckers turning small sums into large and you want to replicate that. Well, I’ve read about people winning the lottery and I want to do that too. But it’s not going to happen. Get it into your thick skulls: you will never get the next Amazon or Netflix; but what you can find is consistency of returns, compounding over a life time that will grow your net worth over time to become substantial.

Got it?

Instead of trying to turn $100k into $1m over the next year, try to do it over the next 15 years — by measuring position sizes, diversification, constantly adjusting to market conditions, becoming a student and a teacher — humbling yourselves to the idea that the market is right and your job isn’t to counter it — but to follow it.

Listen to me now, since you’re unable to think for yourselves.

The volatility will kill you. It will really, really kill you. You’re in a car made of dynamite heading for the sun and you don’t even know it. Harvest those losses, lads, and BEHOLD a new era of the Bear, once festooned with the limbs of the very rich. Not the marginally rich, but the very rich. We will eat them with great avarice and their estates tossed into escrow, assets frozen, stocks liquidated — markets bludgeoned to nothing at all.

Ergo, I bought more DRIP.

Now I’m all over the road today — but bear in mind these intra-day moves are equal to weekly moves, so my actions are in response to that.

The thirst is real and the pension fund buyers are done.

Here are my biggest trading positions.

DRIP 10%
DRV 10%
TLT 10%

Forty percent cash, barreling into the New Year’s.

Enjoy your weekend lads, Jungle.

Throwing shit against the wall — hoping those magically awesome pension buyers step in and bid it higher.

I also sold EXK, +7%.

Are you enjoying yourselves yet?

Regardless of where stocks end up today, down 200 or up 200, I am preparing for the EXTREME eventuality of much lower stock prices.

I predict these matters will come to be in early 2019. As such, I bought PG, doubled up on my TLT position and doubled my DRV position. I have 45% cash and lots of bearish positions set up, like DRIP and NUGT.

It’s all bullshit anyway. Trump trying to jimmy markets. Judge Wapner on CNBC taking phone calls from Leon Cooperman out of a tin can, with intent to rig markets higher. Fuck all of that. Let’s set new records and push this fucker down into the dirt. Let’s reset the financial system and rise above the horseshit, tossing fuckers into prison cells. And not the people who lie and do small crimes. I’m talking about CEOs of major corporations going directly to jail and then executed.

These are my dreams; but they will not come true — because the world is evil and ruined by catamites.

You didn’t think the market could just go higher like a fucking normal market, did you? American stocks are unique and trickery reigns supreme. A knife around every corner. A trap inside every jar of jam. Just when you comfy enough to head outside for a breath of fresh air, a piano will fall from the sky and flatten you dead.

There is only one cure-all for this ailment: BOARD THE ARK.

Why play games and continue to lose money like a fool, when you can enjoy the safety and wondrous world of The Ark?

Aside from that, I have some DRIP, NUGT, DRV — and 50% cash. This is a dreary market, one forged by demons in hell and designed to destroy you — the unwashed pleb. Do not drink their toxic tonic. Wait for a better market with a more defined direction. Playing these trends is equal to riverboat gambling. Fun fact about that, 90% of bettors end up getting tossed, headlong, into the river.