Thursday, June 30, 2011

Market Beta's On

It's undeniable now, the markets are definitely back to risk-on mode - sp500, gold, euro, aud all overcoming their resistence levels. This may continue at least into the first week of July as people start resetting their equity portfolios.

Some key positive newsflows last night:
Greece vote came in despite the protests
BoFA reach agreement on its debts
AUD back to its winning ways

Interestingly my longs in the eur were stopped out on some very sharp whiplash action I got set at 1.44, then go stopped out at 1.433; i.e I bottom ticked my stops. I started yesterday's session bearish trying to fade the action, then was bullish mid-day on the 1.44 breakout, and was stopped on by US open. The volatility is killing me when I'm away from my computer.

However, I picked up PAN into my equities portfolio yesterday, and this morning added some beta, with RIO and FMG getting thrown into the mix. PAN and RIO look awfully cheap.

I did a quick and dirty corr on my equity holding for the past 6 months and they look a little too cosy.

rio

fmg

pan

gns

cvn

sbt

bpty

rio

1

fmg

0.822346

1

pan

0.854976

0.663739

1

gns

0.687508

0.41117

0.823953

1

cvn

0.794955

0.557788

0.930432

0.830988

1

sbt

0.60632

0.420213

0.698344

0.707208

0.773388

1

bpty

0.599707

0.39698

0.77788

0.791088

0.867457

0.784906

1