Wednesday, 4 February 2009

deaf from the noise...

The buzz today has all been reflation cheer leading (not a pretty thought of workers in the square mile wearing those outfits). RIO up 10% today! Oil looks pretty steady, gold has had a decent range over the last couple of days.

The Raven dumped his GS today (don't blame him for the short termism - that will happen when a stock moves 10% in 24hrs), he's now flat financials. MSFT still remains very interesting, its not been as 'frothy' and there is far less chatter in the stock.

To replace his delta the Raven has been buying 1-2M upside calls, they look like a cheap way to make sure you participate in the rally and don't have to panic buy every short squeeze, although the daily move breakevens don't look too clever the premium in the upside wing is cheap relative to the real risk of a rapid move, especially as credit seems to be improving and long term treasuries are weaker.

The Raven has been a little slack on monitoring his portfolio level risks, which is sloppy and he's given himself a slap on the wrist, lucky the market didn't do it for him! So just for discipline he's going to post his Long, Short, Net and Gross numbers to keep him honest:
L: 68%
S: 53%
N: 14%
G: 121%
As he can see, there is not a lot of risk on at the moment, more work to be done! as there is a real battle going on mentally.

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