Bookkeeping: Buying Back some Regions Financial (RF)

Someone stop me; I feel like a bull in a China shop. This is the last purchase of the day on the long side - but it is hard taking a short position into the weekend knowing "the world will be saved" by Bush Sunday night. This is the problem we've discussed with this market for months - government actions mean more than fundamentals - and CNBC announcements can move this market 5% in a blink. It is so detached from anything relating to the market of 2005-2006 or 1998-1999 or 1996-1997; it's all just a betting parlor based on what government will do and who will save us from ourselves. Anyhow, I digress. 3 PM fast approaches and our hostess is getting her drinks ready.

Monday, we cut back heavily on our financial exposure; you remember Monday right? That was when Financials, Retailers, and Housing was the cool thing to buy. That was a LONG time ago and the theme has since been abandonded (although that darn Lennar (LEN) is holding up very well and mocking me for selling it). Since then you have to buy global growth as hedge funds change their mind on what they want to run up on a daily basis.

I took out almost all of our Regions Financial (RF) in the $9.90s as the stock hit resistance, reducing our stake from 1.5% to 0.1%. Now the stock is in the $8.50s (14% lower 4 days later) so continuing our theme of emphasizing the Trader part of TraderMark, we are finding opportunities left and right to sell high, rebuy within days lower, reduce our cost basis, and selling a few days later on the pop - churning out a living. I should of bought near $8 but this is not a full time living so I missed it. We are going to re-up our position stake to 2.2% (we'll try to sell in the mid $9s) while stressing that any act of buying financials is a lewd one based on nothing more than "financials are early cycle and the economy shall turn around in 6 months". Remember we got rid of one of our bank stocks earlier this week so this means the position size in the remaining financial positions will need to be larger to maintain the same "exposure".

We exited a lot of our early cycle exposure early this week and we want to have some exposure in every sector since hedge funds change their minds every day what they want to run up. Next Monday it could be global growth, or it could be housing. Or dry bulk shippers, or retail stocks. Or it could be gold, or it could be financials. It all depends what government initiative is announced and what HAL9000 and his quant fund computer decide is the theme of the day.

That's what our casino is now all about. See how inane it is when you pull back the covers and watch it real close? The term "investing" has now become a laughable concept; it's all about hedge fund flavor of the day. Instead of favorite sectors you have to own everything because on any day the hedge funds come in and run up X sector to generate a return to show their investing prowess! Yes... "investing" 2008 style.

Long Regions Financial in fund and personal account