In case you missed it May 23rd 2022
Gallimaufry: Here are some popular posts from Beachman over the last 4 weeks
Last Friday’s market close was encouraging, imo. After the expected morning volatility due to monthly options expiry, there was a tug of war between the bulls and the bears and the former did not give up.
Since Dec 2021, we have been mired in the longest period of short gamma and low liquidity. This has accentuated the violent up and down intra-day market swings.
Short gamma is a situation in which market makers are forced to buy equity at higher prices and sell them at lower prices to maintain the neutrality of their options trade books.
However, VIX has been well-behaved in the 22-36 range. And, markets are performing efficiently. No circuit breakers have been triggered...not even on major down days. Melvin Capital blew up last week, liquidated their positions and the markets took it in its stride.
Sure, valuations of high growth stocks have been reset lower, however no one knows what a reasonable valuation level is these days. Everyone is guessing.
And the the key question is…which stocks will start commanding a new higher valuation as the market recovers?
Look for my opinion on this question in the next edition of the comeback plan.
I am hearing a lot less talk about inflation and more chatter about a possible recession or stagflation. Maybe inflation concerns are already priced into stocks and bonds. The term "mission critical" is being bantered about in fintwit circles. This is a nebulous and subjective concept, imo. What is and is not mission critical is in the eye of the customer and no external party has a clue. CFOs will cut budgets and headcount when they have to preserve cash and CIOs will have to adjust accordingly.
Here are some popular Beachman posts from the past 4 weeks:
FinHabits
Portfolio report porn is a curse
Musings
Why the US$ Index (DXY) matters
Recent interesting market indicators
Let’s not uncork the bubbly just yet
It's OK to panic...just do it according to your investing plan
It's time to plot our comeback - Part 1, Part 2, Part 3
Portfolio
Which growth stocks have attractive valuations now?
Paid subscriber content
In case I need to sell something to raise cash
Barbell Hedging Beachman's Portfolio - Part 3 (Final)
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