November 28, 2021 | Daily JAM |
On the theory that after Friday’s panic, we will get at least a modest recovery on Monday, I’m selling the three VIX Options in my Volatility Portfolio as soon as the market opens on Monday. The CBEO S&P 500 Volatility Index (VIX) jumped 54% on Friday to close to 28.62. My opinion is that we’ll see the “fear index” give back some of that jump on Monday if the market stabilizes. (If you think the market will plunge further, you should, obviously, hold onto your VIX Call options.
November 20, 2021 | Daily JAM, Friday Trick or Trend |
Our regular (or occasional or perhaps occasionally regular) Friday series (actually running on Saturday this week) Trick or Trend looks at what might (or might not) be emerging investible trends. Exclusively on JAM. This post won’t run anywhere else. Ever. There might be a trend here but with the recent performance of the CBOE S&P 500 Volatility Index (VIX) it’s really hard to tell.
November 17, 2021 | AMAT, AMD, Daily JAM, F, Mid Term, QCOM, Special Reports |
Tolstoy was wrong when he wrote at the beginning of Anna Karenina that “All happy stock markets are alike; each unhappy market is unhappy in its own way.” (That’s what it says in the original Russian, I swear.) Truth is that all happy stock markets are different.
There are the long rallies from valuation bottoms that come after a disaster like the Global Financial Crisis and the Great Recession. There are the sharp quick explosive moves higher that come after the passing of a panic with less damage than expected like that after the Pandemic meltdown in the spring of 2020. And, among all the other happy markets, there are the market melt ups that come after a long bull market has already driven valuations to nose-bleed levels. Sometimes that melt up turns out to be the final blow out stage that comes before a big correction–but not always. And sometimes the melt up just drives stocks to a high where they stagnate while fundamentals catch up with prices. I believe we’re in the midst of a market melt up now. In this Special Report I’m going to outline the ways in which this “happy” market is different; give you advice on how to adapt this rally to your portfolio goals; and finally give you 10 picks for profiting from this melt-up.
November 6, 2021 | Daily JAM |
Even as stock market indexes hit record high after record high, Wall Street is buying options to hedge against risk in the Standard & Poor’s 500.
October 19, 2021 | Daily JAM, Volatility |
Investors and traders are showing no interest in paying to hedge risk in this market–even though we’re again near the all-time high for the Standard & Poor’s 500. Today, as of 3 p.m. New York time the CBOE S&P 500 Volatility Index (VIX) has dropped another 3.31% to 15.77. That puts the index back in my buying range and today I’m adding the December 22 VIX Call Option with a strike price of $18 (VIX211222C00018000) to my Volatility Portfolio.
September 28, 2021 | Daily JAM, Morning Briefing |
In a letter to House Speaker Nancy Pelosi today, September 28, Treasury Secretary Janet Yellen told ... To subscribe to JAM you need to fill in some details below including, ahem, some info on how you'll pay us. A subscription is $199 (although if you're subscribing...
September 21, 2021 | Daily JAM, Morning Briefing |
Retail investors sure tried. They bought $1.93 billion in stocks on Monday. But after a solidly higher open today, Tuesday, September 21, that saw the Standard & Poor’s 500 up 0.78% at 9:48 a.m., stocks drifted slowly lower for the rest of the day as a second day of buying on the dip failed to emerge.
September 20, 2021 | Daily JAM, VIX, Volatility |
Huge surge in volatility this morning. It’s as if everybody woke up and said, “Hey, you know there are risky trends in the world.” As of 12:30 p.m. New York time today, Monday, September 20, the CBOE S&P 500 Volatility Index is up 29.51% to $26.08. I think there’s more volatility ahead so today I’m going to sell the VIX November 17 Call Options with a strike price of 18 in my Volatility Portfolio and buy some more time with a purchase of the VIX December 22 Call Options with a strike price of 19.
September 18, 2021 | Daily JAM, Short Term |
I expect that the the financial markets will remember this week that the Federal Reserve will actually say something after its meeting on Wednesday, September 22. Even if the Fed doesn’t change policy at all, the central bank will deliver a new set of economic projections with views on inflation and GDP growth that could add volatility to an already nervous markThe CME Fed Watch Tool, which looks at prices in the Fed Funds Futures market to calculate market expectations for an interest rate move by the Federal Reserve, says there’s a 0% chance of a change in interest rates at Wednesday’s meeting. The odds for a Fed interest rate increase go up to only 1.8% at the November 3 meeting according to the CME Fed Watch. And are only 1.7% for the December 15 meeting. In other words the market is utterly convinced that the Fed will do nothing.
September 17, 2021 | Daily JAM, Volatility |
The CBOE S&P 500 Volatility Index (VIX) closed at 20.69 today, up another 10.7%. That took the “fear index” above the 200-day moving average at 19.98. The VIX had previously moved above the 50-day moving average at 17.86. I’d be surprised if we don’t see more market nerves driving more buying of S&P hedges to send the VIX higher next week.
September 14, 2021 | ALB, CMI, CRWD, Daily JAM, DE, PANW, Short Term |
I found myself humming “I scare myself” this morning as the market continued its September selling. The Dan Hicks and the Hot Licks song pretty much sums up the market action this morning. We all know that stocks go down in September so we’re sending stocks downward. And we all know that September 17 is the Big Bad Day in the month so it’s unreasonable to expect a turn in sentiment before that date. But so far, I’d note, the selling seems “orderly” with the usual candidates bucking the trend and showing up in the green. It’s when those still in the green stocks start tumbling that I’ll really start to worry.
August 26, 2021 | Daily JAM |
Investors and traders are hedging their bets–a little–ahead of tomorrow morning’s speech by Federal Reserve chair Jerome Powell at the central banker’s (virtual) Jackson Hole jamboree. The worry is that Powell will says something relatively concrete about the Fed’s plans for decreasing its monthly $120 billion purchase of Treasuries and mortgage-backed assets. An end to those purchases is a prerequisite to any move by the Federal Reserve to raise interest rates. So any move on the purchase schedule would be an indicator of the Fed’s thinking about when/if to raise benchmark interest rates now at 0% to 0.25%. The odds on bet is that the Fed chair won’t say anything–something Fed chairs are very good at tomorrow–and that the Fed’s Open Market Committee won’t say anything of substance at its September 22 meeting.
