From the beginning of this year, I was confident the Fed would start raising interest rates sometime by end of this year. Hence I had my long USD position on.
But last month, the price action of the markets - bonds, forex, equities - suggests to me I was wrong.
So I closed all my trading positions and stood on the sidelines (this wasn't easy).
Yesterday's Fed action confirms I was "right" to acknowledge and admit I was on the "wrong" side of the trade last month.
So no damage today ;)
Notice my wry smile behind the headline for this post?
But if I had failed to have the AWARENESS to notice I was wrong, and had stuck with my original trading PLAN, it will be a lot of hurt this morning...
I use 10 times leverage for my futures positions; so it's not tikum tikum.
You are right today is nothing to fuss about.
P.S. CW is right. You don't start to question about minimising further losses AFTER a SIGNIFICANT loss...
Just like u I do not know what's the big fuss actually. But after I watch the video of Economic Machines, I had more thoughts abt it. I m not saying he is right or wrong, just that I had some thoughts!
Maybe we cannot ignore that it do affects the world, maybe not now, but in the long run.
Just my thoughts here: I am wrong, I hope!
Prefer to pretend u dunno u have a cancer tumor n live happily for next many yrs until u find out or u decide to go for a 50-50% chance op to remove the tumor! Tough call...
When I say "what's the fuss" I am saying it through my lens as a "value trader disguise as income investor" LOL
I am sure every cause/ actin will have a effect, especially from fed interešt rate. But I dun see it affecting me to the extend that I need to position my money or glue my eyes at the news. I have already factored in interešt rate going to up to 3 % by 2018 in my calculation of possible earnings of companies. I am sure many companies also have made similar plans.
Also, interešt tightening and loosening when seen over a longer period of time is not going to affect the moat of business although it might quicken or steepen the market cycles.
It is just good news/ catalyst for traders and media mongers.
As for your example on tumor, it touched a raw nerve.
I will 100% choose to live ignorantly.
I have this "curse" of eye twitching non stop )more than 2 days and something seriously bad will happen. It's 95% accurate. I kept wondering what it is and if it is work or family?
Turned up to be my mum cancer cells might have spread to the lungs despite her seemingly successful chemo and good "health" even the doctors are surprise.
Well, I life, so many forces in play, some are more dominant but we can never draw a straight line and say because of A, we will have B.
What difference?
If karmic forces are like that, I believe fed is but a slightly bigger force in the globaliSed capitalism force.
Come what, do what.
Market crash, bunker down and feel depressed and then get on with life.
I think u misunderstood me. Never insulate u predicting future. SMOL and LP will know I free spirit, think what write what, so might but be very coherence Lol
SMOL, like you, i have a long usd position since last year. (check trading war stories comments sections) but it's not in any major currency pairs nor is it in a leveraged account. lol guess where it's in?
Nothing beats learning from first hand experience!
What we learn in this bull/bear cycle we will apply to the next bull/bear cycle.
I got screwed by the US Fed during Sept 2013 when the whole world expected Ben Bernanke to start tapering and positioned accordingly... The Fed blinked...
It was small consolation to read a few months later DBS reported losing couple of millions in trading losses due to "volatile" conditions... Yeah right. Got screwed by the Fed just like me!
And that memory saved me this time round. The US Fed is not the same Fed chaired by Paul Volcker :(
Hahaha SMOL.
ReplyDeleteJust another day isnt it.
B,
DeleteJust another day for long term equity investors.
Significant day for short term traders trading the S&P or Simsci futures; forex; and bond markets ;)
If not nimble, would get whipsawed by the price action last night and today!
Hmm.., 7 yrs with zero interest rate.. or maybe forever?
ReplyDeleteFundamental vs sentiment? Sentiment wins this time!
Rolf,
DeleteI would have been more optimistic if the Fed had hiked...
Now my bearishness has added another notch :(
lol i am already in bear mode since april for singapore, early june for china and US (since the long term trend broke).
DeleteSMK,
DeleteThat's why you are "active" in blogosphere now ;)
But we have to go through the din of people telling us money rotting in the bank...
LOL!
Hmm... But it's what u expected... Isn't it??
ReplyDeleteActually, I also dun know what is the big fuss over it? Raise or not raise...
Sillyinvestor,
DeleteYes and no.
From the beginning of this year, I was confident the Fed would start raising interest rates sometime by end of this year. Hence I had my long USD position on.
But last month, the price action of the markets - bonds, forex, equities - suggests to me I was wrong.
So I closed all my trading positions and stood on the sidelines (this wasn't easy).
Yesterday's Fed action confirms I was "right" to acknowledge and admit I was on the "wrong" side of the trade last month.
So no damage today ;)
Notice my wry smile behind the headline for this post?
But if I had failed to have the AWARENESS to notice I was wrong, and had stuck with my original trading PLAN, it will be a lot of hurt this morning...
I use 10 times leverage for my futures positions; so it's not tikum tikum.
You are right today is nothing to fuss about.
P.S. CW is right. You don't start to question about minimising further losses AFTER a SIGNIFICANT loss...
Hi SI,
DeleteJust like u I do not know what's the big fuss actually. But after I watch the video of Economic Machines, I had more thoughts abt it. I m not saying he is right or wrong, just that I had some thoughts!
Maybe we cannot ignore that it do affects the world, maybe not now, but in the long run.
Just my thoughts here: I am wrong, I hope!
Prefer to pretend u dunno u have a cancer tumor n live happily for next many yrs until u find out or u decide to go for a 50-50% chance op to remove the tumor! Tough call...
Hi Rolf,
DeleteWhen I say "what's the fuss" I am saying it through my lens as a "value trader disguise as income investor" LOL
I am sure every cause/ actin will have a effect, especially from
fed interešt rate. But I dun see it affecting me to the extend that I need to position my money or glue my eyes at the news. I have already factored in interešt rate going to up to 3 % by 2018 in my calculation of possible earnings of companies. I am sure many companies also have made similar plans.
Also, interešt tightening and loosening when seen over a longer period of time is not going to affect the moat of business although it might quicken or steepen the market cycles.
It is just good news/ catalyst for traders and media mongers.
As for your example on tumor, it touched a raw nerve.
I will 100% choose to live ignorantly.
I have this "curse" of eye twitching non stop )more than 2 days and something seriously bad will happen. It's 95% accurate. I kept wondering what it is and if it is work or family?
Turned up to be my mum cancer cells might have spread to the lungs despite her seemingly successful chemo and good "health" even the doctors are surprise.
Well, I life, so many forces in play, some are more dominant but we can never draw a straight line and say because of A, we will have B.
What difference?
If karmic forces are like that, I believe fed is but a slightly bigger force in the globaliSed capitalism force.
Come what, do what.
Market crash, bunker down and feel depressed and then get on with life.
Predicting it, fun meh?
Hi SI,
DeleteSorry to hear on that...
I do not predict future and will never bother too. But I do try to imagine what is the worst to be mentally prepared.
Natural pessimistic in thinking, but positive and enormous strength mentally to overcome current problems normally works for me.
Lol Rolf,
DeleteI think u misunderstood me. Never insulate u predicting future. SMOL and LP will know I free spirit, think what write what, so might but be very coherence Lol
sure got it totally and that is why I enjoying reading what u, smol, LP, Cw n lately More new open minded bloggers' blogs!
Delete:-) haze n rain over will come rainbow one day
SMOL, like you, i have a long usd position since last year. (check trading war stories comments sections) but it's not in any major currency pairs nor is it in a leveraged account. lol
Deleteguess where it's in?
mid year it did give me a scare though.
SMK,
DeleteAs a betting person, I'll put my money that it's US bonds ;)
haha but it's not easy going too. it's getting whipsawed lately.
Deletei'm thinking it's time to move again.
can you guess where i am heading next? ;)
Hello!
DeleteYou not a girl and I not 15 :(
Wait others do the Merlion seeing two grown men doing:
You guess? You guess? You guess, guess, guess!
LOL!
Well, if it looks like US will do QE4, I'll also look into adding to the barbarous relic too :)
wah! pei fu pei fu
DeleteWa 10 times leverage!!
ReplyDeleteIt's not call weapon of mass destruction for nothing ...
I know what CW is coming from.
Parkson retail is one I acknowldge some assumptions made were invalid or more risks had surfaced. It's a 10% cut loss of a small position.
Sembcorp Industries I like, I av down and now blue back. But I not thinking of cutting loss already ... LOL
I AM THINKING OF PANADOL
Sillyinvestor,
DeleteNothing beats learning from first hand experience!
What we learn in this bull/bear cycle we will apply to the next bull/bear cycle.
I got screwed by the US Fed during Sept 2013 when the whole world expected Ben Bernanke to start tapering and positioned accordingly... The Fed blinked...
It was small consolation to read a few months later DBS reported losing couple of millions in trading losses due to "volatile" conditions... Yeah right. Got screwed by the Fed just like me!
And that memory saved me this time round. The US Fed is not the same Fed chaired by Paul Volcker :(