Three winners, zero losers for the September option cycle. The winners were short puts on IWM, and GDX, long vertical call spread on GLD.
In the weekend edition of the Wall Street Journal there is a graphic of a bear morphing into a bull, with a lengthy article from James Grant about how strong the recovery is going to be. Interesting to say the least, for those that have heard or read Mr. Grant's opinions before. To me, this is yet another reason for stock market bulls to be cautious.
Most of the sideline money is pouring into bonds, not stocks, so it may be that stocks have more room to run, even after a six month 55% rally without a meaningful correction, even as overbought as they are. Wow.
As always, for long term money, age appropriate asset allocation, reached with gradual and modest moves is the way to go. All-in or all-out moves, and betting the ranch, is the kind of stuff for 25 to 30 year olds with a good career and the likelihood of an ever increasing income. For the rest, it is rarely ever a good idea to go all-in or move all-out in one fell swoop. The odds of those kind of decisions being smart ones are exceedingly small.
Long GLD (2 positions)
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