Friday, November 9, 2012

Obama Cliff

The weakness that has been building for the past few weeks, the election was the pure catalyst, and a lot of technical traders are taking the post election weakness with another large selloff today.  The market opened fairly strong premarket, then completely clobbered those trying to buy the weakness.

I added some SODA as they came out with strong earnings and guidance; however, I didn't leave myself naked to the market weakness, picking up some LULU shorts.

I bought some ASX ETF cash and moved a lot to Aussie bonds early in the week. and reduced my PEN position, and stayed patient not adding any beta for the past 3 weeks.  I will wait and see where the market starts buying again, my guess is late December, but I'll sit in cash and bonds for now.        

I'm holding SDL and SBT which are both under takeover offers; and both looking like they have a high probability of being acquired.  SBT will mean that I marginally gain on the position, after being underwater for 3 years, and SDL will be a good adder in the current negative action.

I'm short ATVI puts, with expiry next Friday and exercise 11.00.  The close was 11.01 as of yesterday, despite very decent earnings on wed.  This will be interesting to follow next week.