Friday, January 30, 2009

Fund Performance Period 1

For those who read the content of the website via email or RSS reader, you can come to the website at any time and click on 'Performance/Portfolio' tab in the menu bar to get updated positions (weekly) and performance.

Total Portfolio Value, as maintained by 3rd party, can be checked here each day with 20 minute delay vs real time (starting value $1,000,000 or $10.00 NAV)

I will post an update of performance versus Russell 1000 every 4 weeks; our first 4 week period is now complete. (for newer readers, we've been at this for over a year and a half, but just switched over in 2009 to a more appropriate portfolio tracking system - hence I'm "starting over" in terms of performance with portfolio "B")

(click to enlarge)

We made a lot of transactions to effectively stay hedged versus quite a significant drop in the market. During the first part of this period our long positions held up quite well during a vicious sell off, and we had no government interference. In the latter portion, we got stung by the "invisible hand". If not for this past Wednesday when we got "Bad Banked" and fell 0.7% versus the market rising 3.3% (4.0% variance) performance versus the market would of been even better. Unfortunately, we locked in a nice loss in Goldman Sachs (GS) and our Ultrashorts took serious hits, but you have to stick with your discipline; otherwise you are just flailing around without a strategy.

Overall, it's a good start - we've been playing defense and jabbing in and out of a market that cannot be trusted. Investing is still not possible and we're stuck with trading. One day that will change. It's tiring and wearing to be making all these transactions to scrape up a buck. Until we get some panic in the market, we won't be materially deployed on the long side - and on the short side the government can destroy you overnight with a surprise announcement; eventually the market will overwhelm the government and we'll go where we deserve to go, but that does not mean those surprises won't harm you in the short term. For now, I'm sitting in extremely high levels of cash.

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