~reposted from pebblewriter.com (June 5, 2012)
As a member correctly pointed out in his comment on XLF Update, a ramp in XLF would mean some big returns for important components such as BAC, C, JPM, etc. This is very true. Though it pains me to say it, I think banks are ready for a bounce.
I sold all my remaining JPM, GS and MS puts Tuesday. I first jumped on the downside March 27 when JPM was 46 [see: End of the Line], GS was 127 and MS was 20 [ Lots More Where That Came From.]
I played the downturn with options, but even straight-up short positions would have made some decent returns over the past nine weeks:
But,
all good things must come to an end, and I think the tide is turning
for financials. Don't get me wrong... I still think they're dead meat in
the longer term. I just think we're looking at a sizable bounce here
and now if -- and let me be clear, it's a very important IF -- the rumors are
true and Kumbaya Banking and Quantitative Whatever are back.
If
not, this entire exercise isn't worth the bytes it's written with. The
financials, along with just about everything else Bloomberg quotes, will
roll over and die.
OK, with that huge caveat out of the way -- and before you laugh me out of cyberspace -- check out the charts at the new pebblewriter.com.
Note: due to popular demand, monthly memberships are now available. Convert to an annual membership within the first 30 days, and I'll rebate your first month's dues. For more info, click here.
As a member correctly pointed out in his comment on XLF Update, a ramp in XLF would mean some big returns for important components such as BAC, C, JPM, etc. This is very true. Though it pains me to say it, I think banks are ready for a bounce.
I sold all my remaining JPM, GS and MS puts Tuesday. I first jumped on the downside March 27 when JPM was 46 [see: End of the Line], GS was 127 and MS was 20 [ Lots More Where That Came From.]I played the downturn with options, but even straight-up short positions would have made some decent returns over the past nine weeks:
JPM: 46 - 32 = 31%
GS: 127 - 92 = 28%
MS: 20 - 12.50 = 38%
But,
all good things must come to an end, and I think the tide is turning
for financials. Don't get me wrong... I still think they're dead meat in
the longer term. I just think we're looking at a sizable bounce here
and now if -- and let me be clear, it's a very important IF -- the rumors are
true and Kumbaya Banking and Quantitative Whatever are back.
If
not, this entire exercise isn't worth the bytes it's written with. The
financials, along with just about everything else Bloomberg quotes, will
roll over and die. OK, with that huge caveat out of the way -- and before you laugh me out of cyberspace -- check out the charts at the new pebblewriter.com.
...pebblewriter.com...
Note: due to popular demand, monthly memberships are now available. Convert to an annual membership within the first 30 days, and I'll rebate your first month's dues. For more info, click here.
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