Tic, Toc

With each tick higher in the stock market, interest rates and commodities I see a better setup on the short side. I view a stiff correction as a question of when, not if. That said, my net short position remains small for two reasons. Gilead took a dive late in 2010 and I decided to scoop it up, which lowered my net short exposure. Secondly, I am having a hard time wrapping my arms around the timing of a move.

I believe that yesterday's trading has brought us a lot closer to a correction. The news of 300,000 jobs was as good as it gets and call buying was exuberant, even considering recent history. Treasuries are now dangerously close to a level that I believe will start to effect the stock market and economy and  commodity indexes are perched at multi year highs.

The VIX is sitting at extremely low levels which allows one to achieve a significant degree of leverage without having to risk a large portion of money. I am stalking the short side and am getting very excited about the potential.


Anonymous said...

I've been watching the Vix too, think its time to buy some?

Thank for your blog, I follow you every day.

Dallas TX

Anonymous said...

Long CGA @ 7.23


nicasurfer said...

Wasn't it about 6 months ago you noticed that every hedge fund manager was long c and bac.

I think we are at that point with AAPL

Anonymous said...

surfer- if every hedge fund was long c. 6 months ago they are up 30% and still going higher...

Are you saying aapl is going up 30% in the next 6 months!!!!!!!!!!!!!

nicasurfer said...

Sorry, i just remember capital nailing a C short. It looks like it was in april.

His reasoning for going short at the time is that everyone was long C. In addition the goverment was looking at selling their stake also.

I am not short aapl ,but i am thinking of it. There isn't anything that can bring this stock down and it is the most owned tech company by hedge funds.