Friday, 1 February 2008

January P+L recap

Well...I think all in all, that was a pretty disappointing month. I've taken the P+L from just this morning, before the US open, but a rise overnight in some of the futures I am short means the actual Jan P+L was maybe a little higher, but lets go off this number.

Up $14,000, compared to up $10,000 in December.

I'm really gutted by this. I've been so bearish, and I managed to mostly miss all the equity falls last month. I didn't cover as much as I should of on the morning before the Fed cut rates the first time, although I had planned to as soon as the market open, but the f*cking Fed bailed out the longs by cutting before the open, scuppering my gameplan. I also stupidly shorted som Eurodollar futures, although managed to get out for ~$3,000 instead of the over $10,000 I was down at one point. And I've handed some money back being short oil as well.

I think some of my trades have been too short-term, so I'm going to try and hang on to stuff for longer going forward, so the stuff I am short, I am pretty comfortable being short for several months if necessary. No plans to particularly change the shape of my portfolio, although if we saw the carry currencies sell off (mainly Aussie), I'd maybe look to put some of that on. I also may get involved in some commodities from the long side, looking at livestock and cotton at the moment, and may short copper. Away from that, I'd like to have a larger equity portfolio, although I could do with finding some stuff to get long. I want to short some homebuilders and some REIT's I think.

Away from all that, I think the next shoe to drop in the markets will be the real pain in the European economies. There is no way they avoid the US-style housing-led economic pain, it's just a matter of time. So...I'm watching the UK market in particular with a view to getting short. Maybe I'll sell some June FTSE calls this month if the market rally continues.

That's about it. Like I say, an annoying month, I was up $35,000 at one point, so gave a fair bit back. I'd like to take some swings and try to push the P+L up to $70,000 by the end of February, so that's my mental target. Need some share falls, a rally in Treasuries, and a fall in the oil market to make that happen. Not unrealistic, me'thinks.


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