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Random Thoughts: Into Risk Reduction Mode


A good trader knows how to make money and a great trader knows how to take a loss.

  • Couples check in but they don't check out!

  • We've chewed through the macro dew, talked about the daily tells and communicated the two-sided risk in front of meaningful catalysts (earnings, redemptions, credit dominoes) and in the context of thinning ranks into the holiday.

  • I nibbled on a sliver of downside December S&P paper yesterday but I wanna be clear that the risk is relatively negligible. And as I'm going to be out-of-pocket (tomorrow through Tuesday), my inclination is to pare further and get smaller.

  • Opportunities are made up easier than losses and I learned a long time ago that blind risk is a poor man's bet. In that vein, please know that I'm in risk reduction mode (both ways) and-being forthright-booked a small loss on some of those puts.

  • Someone once said that a good trader knows how to make money and a great trader knows how to take a loss. I'm far from a great trader but it's a mantra that has served me well through the years. Just communicating-wins, losses and pushes-with hopes that my process adds to yours.

  • Straight out of Shawshank!

  • The biggest flaw in Boo's paw might be (the multiple data points I'm picking up) that alotta hedges were slapped on and buy-side sentiment is negative independent of the FOMC toggle (25 vs. 50 bips).

  • The caveats to that stream of thought are Bob Marley (Redemption Songs) and Imelda Marcos (looming shoes). Forced selling tends to last longer and cut deeper than even the most fervent bears anticipate.

  • The most bullish thing on my screen? The bid to beta, as Amazon, RIMM, Google, Apple, UA and BIDU are giggling green in synch.

  • The most exciting thing on my radar? The Margarita Maven, who touched down from Rubyville last night and will be hanging with her grandson for the next few weeks.

  • I just found myself reading this article about the December CCA. Perhaps it's because we're planting the seeds for this year's event, a Texas style ho-down tentatively scheduled for Ruby's birthday on December 7th.

  • I just walked by Chachi's desk, pointed to the almonds and said "THAT'S NUTS!"

  • Nice scribe today by MV CMO Charlie Mangano, who ran global brand management for Merrill Lynch for sixteen years.

  • Please don't trade emotional. Flipping opinions as a function of price might work on television but it's a death knell in real-time trading.

  • What the Tuck!?!?

  • I was absolutely floored yesterday by the outpouring of love from around the world. There are alotta good people out there, folks who believe there's a better way to conduct business and a higher purpose to life. They are, in a word, "Minyans" and as I no longer take anything for granted, I wanted to communicate my gratitude.

  • I'm gonna navigate the rest of the Hump on the Buzz before focusing on the important stuff and readying for our West Coast swing. Fare ye well into the dwell and we'll circle up on the other side of the ride.

  • May peace be with you.


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