First
the recap, I count 39 winners 6 losers for the March option cycle.
Grade is C+. The steam roller rally caused losses on some sold calls.
I also took a loss on some COST puts and some legs of multi-legged
strategies. Overall, I felt frustrated and out of synch for most of
the month.
I am up about 4.8% for calendar 2017. As
usual, that's good news and bad news. Good news is a decent gain. Bad
news is that I am well behind the 6.0% for SPY buy and hold
investors. Here are a few other etfs (dividends are not included, SPY
already paid about a 0.5% div):
EEM
+12.8% Emerging markets equity
SLV
+9.0% silver
GLD
+6.7% gold
SPY
+6.0% U.S. large cap
IWM
+2.7% U.S. small cap
TLT
-0.4% U.S. 20 year Treasuries
Again,
my trading account +4.8%. With the rally, there are lot of posts and
questions about market tops. It's been a while since I posted a full
list so will do it again:
Signs
of a market top:
1 ) Inverted yield curve, when short term rates exceed long term
rates.
2 ) Transports lead the first leg lower. IYT is a good proxy for
the DJ Transport index.
3 ) Confirmation will come with the technical breakdown on major
indices. SPY, IWM, DIA break their 50 day and 200 day moving
averages.
4 ) Excessive optimism. It isn't scientific, but the sentiment at
the local "coffee shop" or similar arena can be extremely
powerful. When novices start giving advice, when novices start
bragging about their big profits, that's a time to head for the
hills. Not sure fire, but still something to look for.
4a) Look a bull on the cover of Barrons or Fortune or similar
publications. The sign of the bull is often the sign of the top.
4b) Look for projections for huge future gains from talking heads
on TV, and lead articles on financial magazines and websites.
Of course nothing is 100%. Corrections can happen at any time.
However, major tops tend to have most if not all of the above.
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