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 Bill Davis, 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. Read more
Global Market Comments
November 2, 2015
Fiat Lux
Featured Trade:
(WHY TECHNICAL ANALYSIS DOESN?T WORK)
(SPY), (QQQ), (IWM), (VIX),
(IBB), (HCA), (PANW), (SCTY), (TSLA),
(BIDDING FOR THE STARS), (SPX), (INDU),
(TESTIMONIAL)
SPDR S&P 500 ETF (SPY)
PowerShares QQQ Trust, Series 1 (QQQ)
iShares Russell 2000 (IWM)
VOLATILITY S&P 500 (^VIX)
iShares Nasdaq Biotechnology (IBB)
HCA Holdings, Inc. (HCA)
Palo Alto Networks, Inc. (PANW)
SolarCity Corporation (SCTY)
Dow Jones Industrial Average (^DJI)
S&P 500 Index (SPX)
Dow Jones Industrial Average (^DJI)
A few years ago, I went to a charity fund raiser at San Francisco?s priciest jewelry store, Shreve & Co., where the well-heeled men bid for dates with the local high society beauties, dripping in diamonds and Channel No. 5.
Well fueled with champagne, I jumped into a spirited bidding war over one of the Bay Area?s premier hotties, whom shall remain nameless. Suffice to say, she is now married to a tech titan and has a sports stadium named after her.
Obviously, I didn?t work hard enough.
The bids soared to $15,000, $16,000, $17,000.
After all, it was for a good cause. But when it hit $17,750, I suddenly developed lockjaw. Later, the sheepish winner with a severe case of buyer?s remorse came to me and offered his date back to me for $17,000.? I said ?no thanks.? $16,500, $16,000, $16,250?
I passed.
The altitude of the stock market right now reminds me of that evening.
If you rode the S&P 500 (SPX) from 700 to 2,100 and the Dow Average (INDU) from 7,000 to 17,750, why sweat trying to eke out a few more basis points, especially when the risk/reward ratio sucks so badly, as it did then?
I realize that many of you are not hedge fund managers, and that running a prop desk, mutual fund, 401k, pension fund, or day trading account has its own demands.
But let me quote what my favorite Chinese general, Deng Xiaoping, once told me: ?There is a time to fish, and a time to hang your nets out to dry.? If you followed my Trade Alerts this year and are up now 38%, you don?t have to chase every trade.
At least then I?ll have plenty of dry powder for when the window of opportunity reopens for business. So while I?m mending my nets, I?ll be building new lists of trades for you to strap on when the sun, moon, and stars align once again.
Time to Mend the Nets
?Short term volatility creates long term opportunity, said Rupal Bhansali, of the Ariel International Fund.
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