Do I really have to pretend it's some kind of coincidence that we have raced back to close the quarter just above where we started it in order not to be percieved as a conspiracty theorist? It's not a theory when it happens all the time, is it?
And look at the volume, we gained 70 S&P points in two days on less than half the volume we had when we fell. How does the market go up that much with so much less money coming in? As I noted yesterday, it's a house of cards that can be easily toppled once today's window-dressing event is over. Also, bulls should be very concerned that 2,076.50 is the 50-day moving average on the S&P and, if we can't get over that today – it's a technical failure anyway.
This is not, by the way, sour grapes. Though we believe the market is heading lower (still looking for 1,850 on the S&P over the summer), we are very much in neutral with our paired long and short-term portfolios. On Tuesday we noted that our STP was up to $536,627 and our LTP was at $959,373 as of Mondays close at the lows (see post for strategy details). 70 S&P points later, our LTP has jumped to $1,004,321 and the STP as fallen to $510,062 and that's a combined $1,514,383 (up 152%) and that's UP $18,383 in two days (1.2%).
So we made more money on the way down and we made more money on the way up. Is it alchemy? No, it's BALANCE! We balance our portfolios into uncertain events and, although we have an overall neutral stance, because we are "Being the House - NOT the Gambler", we are still collecting those premiums – no matter which way the market goes. I don't think you can have a better stress test of our system than we've had in the past few days!
Learning how to Be the House and how to balance our portfolios allows us to make money in any kind of market conditions and, more importantly, it allows us to TAKE A VACATION. I went to Florida last Thursday and came back on Tuesday