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Standing Stills

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May peace be with you!

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Chestnut brown canary
Ruby throated sparrow
Sing a song don't be long
Thrill me to the marrow


(Crosby Stills Nash & Young)


The afternoon tone is a minxy wishbone as traders set sail in the choppy cyclone. Half my screens are glistening green as the semis march higher and embolden the four-letter bulls. The other names are up in flames as the bulls get smoked by their silly games. If the dicey dichotomy isn't enough, we're now staring into the double-barreled shotgun that is Elmer and earnings. You wanted action? Well you got it cookie--and it's gonna be a heckuva ride.

Fear is a powerful emotion--we've learned that lesson on both sides of our P&L. That, more than anything, is why I'm trying to keep an open mind as we race towards the fourth quarter. Most funds aren't having a stellar year. Heck, most funds are downright frustrated and have pressed for performance by substituting size for scope. That "compression" is ever-present and may lead to a spooky move. And when you combine acute performance anxiety with other people's money....well, nutty things tend to happen.

Be that as it may--and it may be a lot--I'm still thinking that the double-edged sword may slay the double-barrel shotgun. The combination of earnings disappointments (slowdown) and rate hikage may finally paint the painful picture for portfolio managers. The corporate bond market doesn't support that vibe--Brian Reynolds would be quick to mention the warm reception for the recent issues--and I've learned to respect those variables. But I'll also note the uncanny complacency (VXO), widespread hope and "left field" elements that lurk in dark corners.

I will offer that my risk profile got a bit tighter today as a function of the slippage in Citigroup (C:NYSE) and the financials. The great part about uber-defined (and uber-cheap) volatility is that you can peel a portion off and ride the rest for free. That's admittedly a small portion of my portfolio but it's a stylistic approach that I wanted to share. Our goal in Minyanville has always been to bait the hooks and pass out the rods rather than fillet a fish and serve up your dinner. The shelf-life is much longer and the educational lessons will last a lifetime.

I've gotta jump back to the Buzz as Laurie has technology issues and Succo is sunnin' his buns in Monte Carlo. We will announce a new professor in the coming days (he's a beauty) and we're in talks with another gentleman who I think you'll dig. All good things in all good times, Minyans, as we build our foundation brick by brick and person by person. I sincerely hope you had a fantastic day and, if not, that you're disciplined enough to trade 'em right into the closing bell.

Have a peaceful evening.

R.P.
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Todd Harrison is the founder and Chief Executive Officer of Minyanville. Prior to his current role, Mr. Harrison was President and head trader at a $400 million dollar New York-based hedge fund. Todd welcomes your comments and/or feedback at todd@minyanville.com.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

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