Bought More SDS 20091201
I have been in this trade since late May and am down about $1.7k. Yet, my thesis has remained strong, and I still believe the market continues to be overvalued. With the S&P 500 at 1109, expected market returns are somewhere between 6.0-6.5% per year. This fails to whet my appetite. With the economic pressures of deleveraging, housing, and regulation setting the stage for The Next Recession, I’m definitely cutting against the grain.
The Trade: Bought 50 more shares of SDS @35.64
New Cumulative SDS Position: Long 100 shares; sold 1 Dec $46 put option
Tactically thinking, I generally move gradually in and out of positions. This gives me multiple opportunities to reevaluate my investment thesis. There are instances when this delayed maneuvering forgoes profit potential; however, it has saved me money contrasted to had I gone all in back in May.
(Should the market remain elevated, I may extend this commentary with an update to the Market Valuation article. Or, if something in the upcoming unemployment data catches my eye, I may opine on that instead).
News item: The business cards and refrigerator magnets have arrived! They look great! Let me know if anyone needs a good logo. My design guy was great.
