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Mad Hedge Fund Trader
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John Thomas graduated with a bachelor’s degree in biochemistry with honors and a minor in mathematics from the University of California at Los Angeles (U.C.L.A.) in 1974. He moved to Tokyo, Japan where he was employed by a medium-sized Japanese securities house. Thomas became fluent in... More
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  • There Will Be No Place to Hide in the Next Downturn 0 comments
    Aug 18, 2009 1:34 AM | about stocks: SPY, GLD, USO, TBT, UUP
    When the stock market rolls over, don’t expect to be able to hide anywhere, except in cash. If someone mentions the word “decoupling”, turn around and walk away, delete their number from your Blackberry, delink from their Facebook page, and block their Tweets. Knowing this individual will be seriously injurious to your wealth. To see how highly correlated markets are these days, take a look at the chart below from StockCharts.com. It shows high correlation between stocks (SPX) , gold (GLD), and oil (USO), and similarly high inverse correlations with bonds (TBT) and the dollar (UUP). I have always viewed diversification as a great way to lose more money in varied places with more exotic sounding names. When the Dow drops, the Shanghai market ($SSEC) will probably fall twice as fast, as it did last year.          
    Stocks: SPY, GLD, USO, TBT, UUP
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