While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to six-month time frame, Mad Day Trader, provided by Jim Parker, will exploit money-making opportunities over a brief ten minute to three day window. It is ideally suited for day traders, but can also be used by long-term investors to improve market timing for entry and exit points.
While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to six-month time frame, Mad Day Trader, provided by Jim Parker, will exploit money-making opportunities over a brief ten minute to three day window. It is ideally suited for day traders, but can also be used by long-term investors to improve market timing for entry and exit points.
While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to six-month time frame, Mad Day Trader, provided by Jim Parker, will exploit money-making opportunities over a brief ten minute to three day window. It is ideally suited for day traders, but can also be used by long-term investors to improve market timing for entry and exit points.
While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to six-month time frame, Mad Day Trader, provided by Jim Parker, will exploit money-making opportunities over a brief ten minute to three day window. It is ideally suited for day traders, but can also be used by long-term investors to improve market timing for entry and exit points.
Global Market Comments
March 6, 2014
Fiat Lux
Featured Trade:
(ORLANDO FLORIDA SATURDAY, MAY 17 GLOBAL STRAGEGY LUNCHEON),
(A SPECIAL OFFER FOR AUSTRALIAN SUBSCRIBERS),
(IT?S PEDAL TO THE METAL ONCE AGAIN),
(SPY), (IWM), (DAL), (GE), (EBAY), (GILD), (GS), (BAC), (DBA)
SPDR S&P 500 (SPY)
iShares Russell 2000 (IWM)
Delta Air Lines Inc. (DAL)
General Electric Company (GE)
eBay Inc. (EBAY)
Gilead Sciences Inc. (GILD)
The Goldman Sachs Group, Inc. (GS)
Bank of America Corporation (BAC)
PowerShares DB Agriculture (DBA)
Come join me for lunch for the Mad Hedge Fund Trader?s Global Strategy Update, which I will be conducting in Orlando, Florida on Saturday, May 17. A three-course lunch will be followed by a PowerPoint presentation and an extended question and answer period.
I?ll be giving you my up to date view on stocks, bonds, foreign currencies, commodities, precious metals, and real estate. And to keep you in suspense, I?ll be throwing a few surprises out there too. Enough charts, tables, graphs, and statistics will be thrown at you to keep your ears ringing for a week. Tickets are available for $228.
I?ll be arriving at 11:30 and leaving late in case anyone wants to have a one on one discussion, or just sit around and chew the fat about the financial markets.
The lunch will be held at a major resort hotel 20 miles to the southwest of the city.? The exact location will be emailed with your purchase confirmation.
I look forward to meeting you, and thank you for supporting my research. To purchase tickets for the luncheons, please go to my online store.
Executing the Mad Hedge Fund Trader?s Trade Alerts from the other side of the world can pose some annoying challenges. After speaking with many of my Australian followers on my recent trip down under, I learned of the obstacles presented by distant time zones, dealing in foreign currencies, regulations, and obtaining live customer support.
I want to make my service easy for everyone to follow. Execution of my Trade Alerts should never be an issue. The Mad Hedge Fund Trader has therefore tied up with Halifax Investment Services Limited, an established local broker, to provide support and execution serves for my Australian followers.
Halifax possesses an Australian Financial Services (AFS) License from the Australian Securities & Investments Commission to provide brokerage and custody services. It is a member of the Australian Stock Exchange. It has a relationship with the American firm, Interactive Brokers, which gives it access to state of the art online executive at competitive commissions.
Halifax can open trading accounts, Self-managed superannuation funds, or any other type of account. It also offers a wealth of educational resources you can use to improve your own trading performance.
If you open a brokerage account with Halifax they will provide the following for you:
1) Custody of your Australian dollar funds in a safe, segregated account.
2) Personal customer support from a professional financial advisor in your time zone who will explain the fundamentals, the logic, and the risks involved in every Mad Hedge Fund Trader Trade Alert. They will invest the time and energy to make sure you can execute these trades online on your own.
3) The ability to hedge out foreign currency risks in your trading.
4) Halifax can execute the full range of trades recommended by the Mad Hedge Fund Trader with the greatest of ease. These include stocks, bonds, commodities, foreign currencies, precious metals, exchange traded funds (ETF?s), options, and option call and put spreads.
Halifax is a well-capitalized firm. It does not engage in any trading for its own account. It is the subject of regular audits by its regulator. All cash accounts are insured in value up to AUS$250,000. In other words, it is a financial institution where you can place you life savings and sleep well at night.
To avail yourselves of these services, please open an account with Halifax Investment Services Ltd. by clicking the following: ?http://madhedgefundradio.com/hisl-australia/. Scroll down to complete a form with your basic information. Within a few days, you should receive a phone call from a Halifax financial advisor who has been assigned to provide you assistance.
Good Luck and good trading!
If the prospect of WWIII can?t knock this market down, what will it take? A giant asteroid that destroys the earth?
I would have used ?Balls to the Wall? in the headline for this piece. But as this is a family oriented newsletter I opted for the more politically correct screamer.
Even the most hardened and seasoned traders, like me and Mad Day Trader Jim Parker, were stunned by how fast the markets bounced back from Monday?s war scares in the Ukraine. Of course, everything I said in my Monday letter came true.
It would have been nice if the recovery stretched out over a longer period of time, giving me better entry points for my Trade Alerts. But that was not to be. Too many people are still frantically trying to get in this market. There are oceans of cash everywhere earning virtually nothing. It seems the new trading strategy is that if something hasn?t gone down for three days, you buy it.
Bizarre as it may seem, the weather is emerging as the big driver of markets this year. Even the Federal Reserve is now saying that the weather was a big drag on the economy. This means that every negative data point for the next few months has a great excuse to be ignored.
It also means the growth which was lost in Q1 will get added back in during Q2 as the economy plays catch up. This has the potential to create a growth surge, possibly from a 1% annualized rate to as much as a 5% in the spring.
It is inevitable that this would trigger a major spike up in all risk assets. This realization is rippling throughout the markets to create one of those ?Aha? moments, much like we saw last October, when it became obvious that the indexes would melt up for the rest of 2013. Fasten your seat belt!
If you have any doubts about this scenario, you better take a look at the commodities markets, both hard and soft (DBA). After a dreadful three years, the chart now has the trajectory of a bat out of hell. What might cause this? How about a global synchronized economic recovery that boost US growth by a full 100 basis points or higher in 2014?
So I am going to take advantage of the pre Friday nonfarm payroll doldrums to start loading the boat with positions and scaling up risk. That?s why I picked up General Electric (GE) and Delta Airlines (DAL) today, classic cyclical names. Also on the short list are EBAY (EBAY), Gilead Sciences (GILD) for another visit to the trough, Goldman Sachs Group (GS), and QUALCOMM (QCOM).
Today?s new trades graciously turned immediately profitable, taking my performance up to yet another all time high of 134.41% since inception, and a 2014 year to date gain of 11.91%. That improves my average annualized return to a stratospheric 41.4%. Incredibly, after last year?s torrid 68% profit, my performance is getting even better. It appears that, like a fine Napa Valley wine, I improve with age.
Yes, I know you have been told by the talking heads on TV that stocks are expensive, and that a crash is imminent. Personally, I think equities are cheap and that we are on our way to a Dow Average of 100,000-200,000 by 2030 (no typo here). I will keep that view as long as the stocks that I am buying pay higher dividends than the ten-year Treasury yield (TLT), now at 2.69%.
To support my view take a look at the chart below produced by my friends at Business Insider. It shows that the share of technology names, the lead sector for the entire market, trading at more than five times sales is below 40%, a fraction of the 2000 peak.
I think we have to match, or exceed, this peak before the party is over and the lights get turned out.
?You cannot trust bankers to control themselves. They?re like heroin addicts,? said Berkshire Hathaway Vice Chairman, Charlie Munger.
As a potentially profitable opportunity presents itself, John will send you an alert with specific trade information as to what should be bought, when to buy it, and at what price. This is your chance to ?look over? John Thomas? shoulder as he gives you unparalleled insight on major world financial trends BEFORE they happen.
Further Update to: Trade Alert -(GE)
Buy the General Electric Co. April, 2014 $24-$25 bull call spread at $0.82 or best
Opening Trade
3-5-2014
expiration date: April 18, 2014
Portfolio weighting: 10%
Number of Contracts = 122 contracts
If the prospect of WWIII can?t knock this market down, what will it take? A giant asteroid that destroys the earth?
Even the most hardened and seasoned traders, like me and Mad Day Trader Jim Parker, were stunned by how fast the markets bounced back from Monday?s war scares in the Ukraine. Of course, everything I said in my Monday letter came true.
It would have been nice if the recovery stretched out over a longer period of time, giving me better entry points for my Trade Alerts. But that was not to be. Too many people are still frantically trying to get in this market. It seems that the new trading strategy is that if something hasn?t gone down for three days, you buy it.
Bizarre as it may seem, the weather is emerging as the big driver this year. Even the Federal Reserve is now saying that the weather was a big drag on the economy this year. That means that every negative data point for the next few months has a great excuse to be ignored.
It also means the growth that was lost in Q1 will get added back in during Q2 as the economy plays catch up. This has the potential to create a growth surge that generates a spike up in all risk assets. Fasten your seat belt!
So I am going to take advantage of the pre Friday nonfarm payroll doldrums to start loading the boat and scaling up. That?s why I picked up General Electric (GE) and Delta Airlines (DAL) today, classic cyclical names. Also on the short list are EBAY (EBAY), Gilead Sciences (GILD) for another visit to the trough, Goldman Sachs Group (GS), and QUALCOMM (QCOM).
Today?s new trades graciously turned immediately profitable, taking my performance up to yet another all time high of 134.41% since inception, and a 2014 year to date of 11.91%. That takes my average annualized return up to a stratospheric 41.4%. Incredibly, after last year?s torrid 68% profit, my performance is getting even better. It appears that, like a fine Napa Valley wine, I improve with age?
Yes, I know you have been told by the talking heads on TV that stocks are expensive, and that a crash is imminent. Personally, I think equities are cheap, and that we are on our way to a Dow Average of 100,000-200,000 by 2030. I will keep that view as long as the stocks that I am buying pay higher dividends than the ten year Treasury yield (TLT), now at 2.69%.
To support my view take a look at the chart below produced by my friends at Business Insider. It shows that the share of technology names, the lead sector for the entire market, trading at more than five times sales is below 40%, a fraction of the 2000 peak.
I think we have to match, or exceed, this peak before the party is over and the lights get turned out.
The best execution can be had by placing your bid for the entire spread in the middle market and waiting for the trade to come to you. The middle market is the halfway point between the bid and the offered prices that you see on your screen with your online broker.
The difference between the bid and the offer on these deep in-the-money spread trades can be enormous. Don?t execute the legs individually or you will end up losing much of your profit. Keep in mind that these are ballpark prices only. Spread pricing can be very volatile especially on expiration months farther out.
Here are the specific trades you need to execute this position:
Buy 122 April, 2014 (GE) $24 calls at??.????$1.96
Sell short 122 April, 2014 (GE) $25 calls at??..?..$1.14
Net Cost:????????.???????..??....$0.82
Profit at expiration: $1.00 - $0.82 = $0.18
(122 X 100 X $0.18) = $2,196 or 2.20% profit for the notional $100,000 portfolio.
