I'm covering the Jacobs Engineering (JEC) short we put on last Friday @ $41.10 here in the $38.50s. This was a 3.3% stake and a 6.3% gain in 4 days; second time to the well with Jacobs on the short side.
I am quite happy with performance on the short side of the portfolio overall - if I could only get any of these darn long positions to work it would make for better times. Not pleased with the long side of the book the past 3 weeks at all.As of early morning we are down below S&P 820 which has been the magnet. S&P 800 has been the line in the sand; as we have been saying for weeks - play the range until the range breaks. It will break eventually but bulls have been in denial and stubborn. I'll be getting more aggressive on the short side if we break down below 800 but for now you have to assume the magical buy orders from out of the ether will show up again as we test 800.
No position
3 comments:
I love your shorts, and I think this is as good as one can be in this market!
I'm not sure if that's a shine or if gold is actually winking at you Mark ;)
Hey mark, when you established this short, didn't you comment: If we are wrong, we can be out at $42.50 and take a modest loss of 3% (on feb 6th).. that said, didn't you/we already get stopped out? unless you were using that for a "closing" price. please clarify, thank you. Andrew
Anon,
Excellent question
I guess the best way to say it is I am not a "mechanical" trader - i.e. I don't have those stops set physically, more mentally and I look at it within the mosaic of the market
Let me talk you through my thinking with JEC
$44 was the recent high; if it had broken north of that I would of gotten nervous and cut back half and then on the next downfall get out more in the $42s (if given the opportunity)
On the 9th it rallied since the market was still in "commodity/global growth" love stage... but that was more of a "sector" trade than a JEC trade. On the 10th a smallish US centric competitor ACM had a nice report and brought up the whole sector... but JEC still did not get over $44... so I held. Plus this was right near Geithner and we were at the top end of our recent range so a "sell the news" reaction seemed likely - although you never know.
So all that went into my viewpoint; I guess the best way to say it is I don't look at each position independently but in terms of portfolio management. I had also covered some other shorts early in the week so if I had covered JEC I would not have that much downside protection in case of a adverse reaction to Geithner. So that was another consideration - I wanted to be about 50% long/50% short going into that day. And I had let go some short exposure already so I was already below the 50/50 split; selling JEC would of made me even more unbalanced.
I hope that answers it, and again those are really guidelines on how I view a chart when I make the trade and considering the portfolio I have when I enter the position.
Post a Comment