I grabbed some of our favorite position this morning, in the low $8 range. My position is now .5% of all assets held, and I am treating the notes like covered option positions. If we experience a major reversal in the next few months, my gains from the position should stand north of 2-3%. If not, I lose .5% (or less) and move on.
Really, it’s pretty straightforward. Since the value of TVIX’s assets have undergone “price discovery” there’s little chance of continued bloodshed. Thank God I didn’t own more before now. And since I’m looking for that major correction, those assets can appreciate in price quickly and with great multiples.
Also, I’m contemplating selling off some of my AEC holdings. As I mentioned a few days ago, hearing talk of reform to Fannie Mae and Freddie Mac has me jittery. Those organizations fling cheap financing through the system, and AEC has admitted to being influenced by it.
I doubt very much that Democrats will permit overt change to come to their favorite pet projects. However, I don’t doubt for a second that Republicans would try to curtail Fannie and Freddie. Since I’m predicting a small Democratic Party resurgence in this election, I am calm. However, if I catch wind that Republicans are going to do better than I first supposed, that could be forbearing of trouble for me.
So maybe I scale back AEC. Right now, my portfolio is more than 60% comprised of just three positions: AEC, CLP, and CCJ.
That’s not how it always was. I used to have BG and AWK also, but the sheer magnitude of losses from my former short position in UCO forced my hand. I have since rolled over my energy and oil shorts into “fixed risk” positions of ERY and SCO and am waiting patiently, hoping that coming months redeem my portfolio of the 20%+ losses I incurred late last year.
However, if that doesn’t happen, I am very exposed to just three positions (plus assumed losses from the continued deterioration of the ETF’s).
In short, I feel comfortable that my portfolio is stable for the moment.
But damn, I really don’t need another blow up.
If you enjoy the content at iBankCoin, please follow us on Twitter
Democratic party resurgence? I beg to differ. Did you see what happened in 2010? Multiply that by 100.
First, let me say major points for your Gravitar.
When I say Democratic Party resurgence, what I really mean is that they’ll probably pick up a few seats while otherwise things hold mostly static. They’re not coming back to full power like they did in ’08.
Sorry, but I just have to disagree with you. I do not see the energy in the GOP necessary to get those kinds of numbers. Obama is vulnerable, but the GOP is populated by idiot freshmen.
This is not a political prediction, simply realism; I also predicted that 2010 would be a bloodbath for Democrats and chose to spend election night watching MSNBC in amusement.
Awww, you changed it back. I was a big fan of the GTFO sticker with the Obama election crest.
just say no
lol
Careful with that 2x leveraged contango in the front month vix futures. A non leveraged VXX position should lose approximatel -10% per month if spot vix stays flat (With today’s vix futures term structure). TVIX’s 2x daily compounding will make this even more expensive to carry. I find VXZ has a far lower cost to carry (rolls 4th to 7th month futures) and has approximately a -4.68% monthly cost to carry with the current term structure, downside is it won’t spike as much as TVIX. Or there is also TVIZ which gives exposure to 2x mid term vix futures.
I love these vix ETP’s, XIV has been a great trade year to date with the huge backwardation (up 77%), the tough part with XIV is having an exit strategy and not loosing all profits when the trend changes and VIX spikes.
Thanks for the heads up. Please understand I’m not going to be careful with .5% of assets though.
is TVIX dying, geez ???
Yes, it is.
God Thaler.. come over from the dark side and start BANKING COIN (no exclamation out of respect)
Best case scenario, ccj is a laggard looking for rotation love. I’m still long.