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Press Conference!


There aint gonna be no rematch!


It's another wild day in Minyanville and I've called this press conference with hopes of communicating some thoughts to my fellow Minyans. I will humbly ask that each critter be limited to one question and that you ask them in an orderly fashion. (looking around the room) Hoofy?

Hoofy: I'm a little flummoxed by your reticence on the long side, Toddo. The dollar has reversed higher, crude is spilling, the internals are firm and everybody and their sister knows that "they're" gonna try and mark 'em higher into quarter end. Denial isn't just a river in Egypt you know!

Toddo: As I've said, Hoofy, I understand that I'm simply a pawn in the bigger picture and, for the most part, that's why I used yesterday's melt to cover the lion's share of my underlying exposure. With so many traders focusing on S&P 850-860, it was bound to hold the first test. Now, as the market lifts, I'm attempting to use prices to my advantage. That doesn't mean I'm blindly shorting -- that's risky business -- but I'm certainly scanning the globe for cheap vol. With the VIX nearing 30, I can pick up some May downsides (out-of-the-money puts) and tuck 'em away. It's a relatively low risk way to play a failure.

Snapper: Mr. Harrison, you've been pretty steadfast in your big picture bent. I'm wondering how you'll handle a rally if, in fact, it carries us into quarter end?

Toddo: I'm not gonna tell you I'm immune to the notion of performance anxiety -- that would be fibbing and I don't do that. What I will say is that I'm risking relatively small pools of capital and making an educated bet. I can't tell you when (if at all) the schvitz will hit the fan but if it does, my sense is that you won't have a chance to sell 'em. As always, that's simply an honest observation.

Daisy: Isn't that a little extreme, sir? There sure seem to be a lot of people waiting to buy the dip. And if they don't get one, they'll buy the rally. Look at the alligators today -- portfolio managers are rotating money into equities and they don't seem done yet.

Toddo: That's a valid point, young miss, and I'm conscious of the snowball effect (particularly into quarter end). However, mutual fund cash reserves have dipped to 3.9% and that's a red flag. It may not matter today and it may not matter into quarter end, but it's certainly something to note. Again, let me stress that I'm defining my risk and if I'm dead wrong, I'll simply lose premium and opportunity. We're talking dollar kind puts out to May -- not naked short exposure.

Sammy: You understand that many technicians are calling for a rally above S&P 900 before a potential spill, don't you Toddo? If form holds, you're gonna be early on this call. If there's anything you can set your watch to, it's the fact that you always set your watch fast!

Toddo: Point well taken, Sam. If we've learned anything during these past few weeks, it's that timing this market is a lesson in futility. I'm not projecting this stylistic approach either. Every Minyan has their own style and methodology. I'm simply communicating my process hoping that it adds value to yours.

Boo: I, for one, would like to applaud you. I think this will prove to be a money trade. There are a lot of influences in the marketplace right now but we've learned that, over time, stocks don't lie and people do. Besides, once the war focus dims, investors will turn their attention to the other metrics and realize that nothing much has changed. It's a matter of time before perception morphs back to reality.

Toddo: Thank you. And please understand that I only want the best for the critters, the Minyans, the market, our soldiers and the world. I won't confuse hope and faith, however, and as long as I'm operating with my right hand up, I'm going to call it as I see it. Due to the nature of my defined risk, I'm comfortable with the one appendage but, at the same time, I'm hopeful that this press conference helped to explain my current posture. Thank you all and may peace be with you.

With that, I stepped off the podium and made my way through the crowd of reporters. Tony Dwyer and Brian Reynolds are due to arrive on the bell for a closed door cabinet meeting and I need to manicure my risk profile before they arrive. These are trying times indeed, and it's important to surround yourself with people you trust. In Minyanville, trust is a common thread.

Good luck into the close.
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