TRADING UPDATE
Same-o, same-o. Another 52.54 points down on the S&P500 (-6.1%), and 427 points on the Dow (-5.1%). Personally I think the problem is fund redemptions. As people’s home equity is wiped and/or they’re losing their jobs, more and more are having to tap into their retirement savings for living expenses and redeem mutual funds – which just hit the bids the next day. It doesn’t help that people opening their statements in November are processing the large losses of October.
There used to be a saying “as goes General Motors, so goes the United States”. Back in the recent dot.com times, everyone was going on about how now because of the information age that no longer held true. Today, the U.S. car companies are being dismissed as bloated, bureaucratic, up their eyeballs in debt, rudderless, and without vision. All three will most certainly go bankrupt without outside intervention. Hmmm.
Today’s big move created two more REAP signals.
| REAP TRADES | ||||||||
| # | Trade | Qty | Stock | Symbol | Price | Grp | ||
| 179 | Sold | 40% | HBP SP500 Bear+ ETF | HSD | @ | $38.62 | 1 | |
| 179 | Bought | 80% | ProSh Ult Financials ETF | UYG | @ | $34.69 | 1 | |
| 180 | Sold | 36% | HBP GlbGld Bear+ ETF | HGD | @ | $10.59 | 2 | |
| 180 | Bought | 73% | Genesee & Wyoming | GWR | @ | $24.59 | 2 | |
| Sold | 31% | HBP Djia Ag Bull+ ETF | HAU | @ | $5.32 | 1 | ||
| REAP methodology detailed in the blogroll under “My Portfolio” | ||||||||
| Qty % are amount by which shares counts are decreased/increased | ||||||||
Not a big surprise that the short side was involved in both profitable sells. HGD did its thing again – bought last Friday at $8.64, taking profits today at $10.59 just 3 sessions later. This ETF continues continues to be an amazing trader. And that’s the 2nd straight buy of Genesee and Wyoming railroad (GWR), suddenly making it the largest holding in the portfolio. The HAU sale was to continue to raise cash and to ease out of most of the commodity 2x ETFs (because of the way they erode over time other than than for pure market reasons).
Because I’m now up to about a 75% net-long portfolio bias, today’s losses pretty-well tracked the market in Canadian dollar terms. Much of what I’ve been gaining with the compounding dynamic of REAP, I’ve been giving back from the rapid decline of the Canadian dollar, so not all that much has changed in the past month or so relative to the S&P500’s performance, but I’m still well ahead of it on the year by 13.7%. But it’s a new low in absolute terms with a year-to-date loss now of almost 9%. It seems I started taking my hedges off a tad too soon.
| PORTFOLIO SUMMARY | 19-Nov-08 | ||||
| (in $C, adjusted for $US exchange rates) | |||||
| PORTFOLIO | S&P500 | S&P500 | SP500 $C | REAP | vs S&P |
| Tot Retrn | |||||
| Reference Date | Start | Last | % | % | Var. |
| Inception MAR 07 | 1406.2 | 806.6 | -32.9% | -30.5% | 2.3% |
| Re-start OCT 07 | 1526.7 | 806.6 | -24.5% | -18.3% | 6.3% |
| 2008 Year to Date | 1468.4 | 806.6 | -22.5% | -8.8% | 13.7% |
| Discretionary Trading P&L (included in above results) | -5.8% | ||||
| Canadian dollar | Last | Inceptn | Var. | Restart | Var. |
| 0.799 | 0.8547 | 6.5% | 1.0069 | 20.6% | |
| Dividend Yield (current) | 3.93% | ||||
| Intrinsic leverage (from 2x ETFs) | x | 1.32 | |||
| Currency Mix | 100.0% | ||||
| Canadian Investments/Cash | 54.0% | ||||
| US Investments | 37.6% | ||||
| Other (country ETFs) | 8.4% | ||||
| Market Bias | Net Long | 73.7% | |||
| Cash | 5.4% | ||||
| Short | 10.5% | ||||
| Long | 84.2% | ||||
| Theme Mix | 100.0% | ||||
| Commodity ETFs | 18.6% | ||||
| Short Commodity ETFs | 3.6% | ||||
| Short Equity ETFs | 6.9% | ||||
| Energy | 3.0% | ||||
| Agriculture | 8.8% | ||||
| Alt Energy/Infrastructure | 9.1% | ||||
| Financials | 11.3% | ||||
| Health Care | 4.5% | ||||
| Technology | 9.7% | ||||
| Transportation | 5.5% | ||||
| Restaurants | 0.0% | ||||
| Country ETF | 8.4% | ||||
| US Closed-end Funds | 5.1% | ||||
| Cash | 5.4% | ||||
| Portfolio Notes | |||||
| Inception date is when I started tracking portfolio performance in | |||||
| this blog. I track it to reflect total performance after initial mistakes | |||||
| and discretionary trading losses. A more accurate representation | |||||
| of REAP’s “pure” performance is as of 10 Oct 07, when I | |||||
| re-established it after selling out the portfolio twice due to | |||||
| sub-prime systemic concerns. | |||||
| *** S&P Comparison is total return to reflect dividend re-investment | |||||
| REAP GROUPS | |||||
| Stock | Sym | Last | Gain % | Weight | Yld |
| Group #1 | |||||
| HBP DJIA Ag Bull+ ETF | HAU | $5.10 | -53.95% | 2.7% | 0.00% |
| Global Agri-Bus Trust | ABG.UN | $4.00 | -0.74% | 4.7% | 12.41% |
| HBP CrOil Bull+ ETF | HOU | $5.03 | -45.12% | 5.5% | 0.00% |
| HBP SP500 Bear+ ETF | HSD | $41.01 | 34.02% | 1.9% | 0.00% |
| Intel Corp | INTC | $12.49 | -14.89% | 3.0% | 3.82% |
| Sun Hydraulics | SNHY | $12.52 | -6.23% | 2.2% | 2.69% |
| PrSh Ultra Financ’l | UYG | $4.63 | -43.02% | 3.2% | 4.83% |
| Zweig Fund Inc | ZF | $2.47 | -13.77% | 2.6% | 16.19% |
| Group #2 | |||||
| Arc Energy Inc Tr | AET.UN | $18.59 | 6.06% | 3.0% | 16.43% |
| HBP GoldSh Bear+ ETF | HGD | $10.60 | 4.67% | 3.6% | 0.00% |
| HBP NASDAQ Bear+ ETF | HQD | $49.75 | 42.46% | 4.9% | 0.00% |
| ISh Australia ETF | EWA | $11.92 | -15.15% | 4.6% | 9.10% |
| Forest Labs | FRX | $21.49 | -23.31% | 2.4% | 0.00% |
| Gen & Wyom | GWR | $24.64 | -7.34% | 5.5% | 0.00% |
| Nvidia | NVDA | $6.23 | -26.23% | 1.9% | 0.00% |
| Group #3 | |||||
| HBP Gold Bull+ ETF | HBU | $11.60 | -14.12% | 2.3% | 0.00% |
| Potash Corp Sask | POT | $81.02 | -15.28% | 4.1% | 0.42% |
| Nthld Pwr Inc Fund | NPI.UN | $11.20 | -3.23% | 3.4% | 9.33% |
| CME Group | CME | $170.88 | -40.34% | 4.0% | 6.99% |
| Cree Inc | CREE | $16.53 | -15.58% | 1.1% | 0.00% |
| Formfactor | FORM | $12.16 | -9.26% | 2.1% | 0.00% |
| Zweig Tot Ret Inc | ZTR | $2.96 | -11.75% | 2.5% | 12.88% |
| Group #4 | |||||
| HBP GoldSh Bull+ ETF | HGU | $5.03 | -32.37% | 3.1% | 0.00% |
| HBP NGas Bull+ ETF | HNU | $7.66 | -36.01% | 5.0% | 0.00% |
| IGM Financial | IGM | $32.92 | -5.61% | 4.1% | 5.87% |
| FTSE/Xinhua China ETF | FXI | $22.28 | -26.49% | 3.8% | 3.67% |
| Nokia | NOK | $12.98 | -20.82% | 2.5% | 4.76% |
| Eli Lilly | LLY | $31.41 | -3.24% | 2.1% | 5.79% |
| Claym Gl Solar ETF | TAN | $6.77 | -36.49% | 2.5% | 0.00% |
| Nortel Networks | NT | $0.62 | -58.51% | 0.2% | 0.00% |
Since Obama won the election just 15 days ago, there’s been a bear-market within the bear market – 20% down. And there are no obvious reasons out there for a market turn. There never is during the worst of a bear market. It certainly takes nerve (or a plan) to be buying in this environment. We’re in leap of faith territory here if you don’t want to miss the big initial move when we do finally turn.
Leap on.
Cheers
Allocator
a.k.a George Parkanyi
gparkanyi@parkanyi-intl.com
Copyright 2008 – all rights reserved
