Markets roar to start 2023, with almost everything up. My trading account was up about 2.6%, which sounds good, but trails all the US stock indexes. Keep in mind that I was mostly in cash on Christmas 2022, and slowly deployed assets. So I’ll take it.
Here are a few etfs year-to-date for 2023:
EEM emerging mkt 10.1%
TLT US20 yr 6.7%
QQQ Nasdaq 100 6.2%
IWM Russell 2000 6.1%
GLD gold 5.7%
SPY SP500 3.5%
SLV silver 0.0%
Last year’s big losers, bonds and the Nasdaq were up big. Emerging markets had a year’s worth of returns in three weeks. Captain Obvious will say that the pace is unsustainable. The bigger question is what next? Is this another short term rally in a longer term bear? A short term bull market? A new longer term bull?
My guess is that this is a short term bull. Enough juice to get people excited, but not near enough to make new all time highs. The middle road is the most likely scenario. So lower lows may also be unlikely. One play would be to sell puts at the 2022 lows, because there may be more buyers there.
As always, I am not one that makes bold moves. So perhaps credit spreads, selling puts 1% or 2% below the 2022 lows, and buying some protective puts a bit below those.
Thanks for reading. Happy Lunar New Year for those that follow that calendar. It is the Year of the Rabbit, or I like to say Year of the Hare because it rhymes.
