Our 1 year Anniversary!!
Week 50 - Equity Portfolio Update
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The line in the sand coming into a new week is ~5890.
Daily
Subscribers can see all the individual Signal Strength scores for each ticker. You can see here for SPY that all the different timeframes SoS are all high. What is important for this system is both new prices and old. We have to consider in our ranking that old bad prices disappearing from our lookback window are just as important.
My signals to short are not as robust as our long signals. Therefore my goal is to find where to buy but always have price at which I close the trade if it goes wrong. From the Uppsies you can see momentum is falling but this simply means prices are rising slower than before. From Downsies we can see the volatility compression has driven that price signifies “we are wrong” is now much closer to last price.
The Orange Pivot showing a break of Trend previously was -5% is now -2.5%.
This drives everything about our portfolio construction!!
I track the index. I track the components of the index. I have multiple layers to derive how I make changes to the portfolio.
All of these layers are weighted. They have a different impact on the whole at different times.
We should never lose sight that none of this is easy. Could you imagine just rocking up at the Camp Nou on any given Sunday and putting yourself in the Barcelona team.
We cannot escape the fact that we are taking on allocators, hedge funds, PHDs and Jim Cramer! We are taking the decision “yeah I can play against Messi”!!
We can never let ourselves mistake skill for what really has been a bull market. That is why I have points where I say “nope I am not going to play”. I care far more about those than what any individual ticker might be the next one that goes up 50-100%.
Current Open Equity = 36.3%
Stop Loss Trigger = 30.8%
Current Closed Equity Return = 26.6%
Our open equity outstanding is just over 36% since we started in Dec ‘23. We have been able to capture 26.6% returns in closed trades, meaning ~10% open equity still belongs to Mr Market. Until we close the trade it doesn’t yet belong to us!
If all our stop losses hit bar any gap risk we hope to close ~30.8%
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And our current open positions:
Example of positions closing this week.
The Energy experiment this week came at exactly the wrong time. I don’t like it but at the same time this year, we have benefitted from big overweight moves in Tech, Discretionary, Utilities and Industrials. Those worked and this one didn’t. Thats OK. Those moves came when they were non-consensus and didn’t “make sense” but to our benefit.
Please subscribe to see more of the portfolio we are constructing.
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