JeremyK

So I guess the S&P analyst responsible for assigning the credit rating to U.S. sovereign debt ended his seventy year vacation on the golf course to issue a controversial downgrade to AA+.  Given the clumsiness of the report upon its release, I suspect the researcher constructed his note on the “19th green” inside the clubhouse after one too many beers on the back nine.  While my wife blasts me when I fail to balance the checkbook by $1.29, the ratings agency, while owning up to the $2 trillion calculation error the Administration accused it of, still proceeded with the move away from AAA.  S&P also leaned on a much diminished likelihood to the end of the Bush era tax cuts in 2013 as a major assumption to its conclusion Continue reading »

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Whenever I have misfired on predicting market direction, I review the data I used in my analysis in formulating my erroneous investment thesis.  I do this for two reasons.  The first allows me to make a more accurate prognostication the next time we encounter a similar environment while the second yields clues on what will precipitate the inevitable turn for equities.  When managing the Beacon Worldwide Opportunities hedge fund last August, I got caught long as the S&P 500 sold off 8% because I disregarded a reliable oversold indicator that I track as well as ignored weak economic data that I argued was dirty, thanks to a variety of outside influences such as the expiration of the first time homebuyer tax credit, and did not reflect the true state of the recovery as global numbers were accelerating aggressively. 

After reevaluating my research, I concluded that since the sentiment statistic had trended to more neutral territory and valuations on stocks had ventured to a point cheap enough to entice institutional buyers, I felt comfortable adding to my long positions which allowed the fund to finish that quarter up a solid 7% Continue reading »

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Welcome back large institutional investors.  Why don’t you take your coat off and stay awhile.  We missed you.  After nearly a fortnight dominated by day traders punting E-Minis around and hedgies looking to jettison risk in the futures markets, large vanilla funds announced they had seen enough and started to put money to work aggressively.

I have written many times how I use the NYSE TICK figures Continue reading »

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