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SanDiegoNonSurfer

SanDiegoNonSurfer
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  • Why I Am Hedging My Portfolio With UVXY [View article]
    Close, but not quite equivalent. UVXY is 2x VIX. SVXY is 1x inverse VIX. (2x v 1x)
    Feb 24, 2015. 10:18 PM | Likes Like |Link to Comment
  • Why I Am Hedging My Portfolio With UVXY [View article]
    "it also allows you to get on the right side of 3x leveraged ETF tracking error"

    Yes, shorting UVXY is a good strategy. I prefer to trade XIV/SVXY instead. But neither hedges downside risk in a portfolio that's long the broader market, which is what the author is looking for. Correlation-wise it tracks the market rather than being anti-correlated. I prefer complementary strategies for hedging -- low beta, investing in out-of-favor sectors. But you can also hurt yourself with these by losing patience at the wrong time.
    Feb 24, 2015. 03:48 PM | Likes Like |Link to Comment
  • Why I Am Hedging My Portfolio With UVXY [View article]
    UVXY...bad choice to hedge a possible event at an unknown future time. This is a rapidly decaying product because 1) it's a 3x ETP, so tracking errors are magnified and 2) it only goes up when the VIX is in backwardation, which historically happens only about 20% of the time. 80% of the time it's falling so fast you'll have no chance of recovering your capital. Ever.

    Cash would be a better hedge than UVXY. Or sell covered calls on all or a portion of your positions you believe to be most at risk for some cash to offset a possible decline.
    Feb 24, 2015. 01:25 AM | Likes Like |Link to Comment
  • Investors pulling the plug on utilities as Treasury yields rise [View news story]
    "Is yield the only reason to get into utilities ?"

    Low beta can be a good reason.
    Feb 24, 2015. 12:17 AM | Likes Like |Link to Comment
  • The Biggest Risks To Stocks In 2015: A 10-Point Analysis [View article]
    Congrats, James!
    Feb 24, 2015. 12:16 AM | Likes Like |Link to Comment
  • The Biggest Risks To Stocks In 2015: A 10-Point Analysis [View article]
    Aw, thanks, James...ended up channeling A&C there :-)

    Thanks for your analysis...always enjoy them.
    Feb 22, 2015. 04:08 PM | Likes Like |Link to Comment
  • Hawks Take Flight [View article]
    "If these were noble people maybe, but these are bankers and academics."

    LOL!
    Feb 22, 2015. 03:39 PM | 3 Likes Like |Link to Comment
  • Hawks Take Flight [View article]
    Dr. Yellen is certainly more hawkish than market participants realize. She also has a record of doing what she says she'll do -- not necessarily a good thing, since there are times one should re-think a prior decision.
    Feb 22, 2015. 11:45 AM | Likes Like |Link to Comment
  • The Biggest Risks To Stocks In 2015: A 10-Point Analysis [View article]
    " There has been an economic crisis at the end of each two term presidency since Nixon"

    That seems tenuous. Carter (one term) was president during the oil embargo and stagflation that followed. Hard to say just when the S&L crisis started, but the first S&L failure (with bank run and capital controls) was in 1985, first year of Regan's second term. Seems more accurate to say there were crises at the end of two of the three two-term administrations, one crisis during a one-term administration, and one crisis in the middle of a two-term administration.

    However, there was also the Gulf war during another one-term administration (GHW), with yet another oil shock, so one could say there were crises during all of the one-year administrations. And of course there was also the "Reagan Recession", shortly after he took office in which unemployment reached ~10%.

    Given that 100% of the one-term presidencies since Nixon had an economic whammy, maybe we should be most worried about our next one-term president. Or, given that every elected President since Nixon has seen an economic crisis, perhaps we should simply worry....
    Feb 22, 2015. 04:22 AM | 2 Likes Like |Link to Comment
  • Unconventional Fracking: Changing The Future Of Drilling [View article]
    "The comments above about the environment are kind of funny in a sad sort of way. I weep for the products of American education."

    Why do you feel that interest in H20 conservation represents an educational failure? Minnesotans may not be especially concerned about having enough clean water, but that doesn't mean there aren't valid concerns in other regions.
    Feb 21, 2015. 09:33 PM | Likes Like |Link to Comment
  • The Biggest Risks To Stocks In 2015: A 10-Point Analysis [View article]
    " Greece must submit plans and Troika has til Wednesday to react."

    All that's absolutely required by Monday is a non-empty piece of paper:

    From the Eurogroup statement on Greece:
    "The Greek authorities will present a first list of reform measures, based on the current arrangement, by the end of Monday February 23. The institutions will provide a first view whether this is sufficiently comprehensive to be a valid starting point for a successful conclusion of the review. This list will be further specified and then agreed with the institutions by the end of April. "

    Source:
    http://bit.ly/1z7Bn2q

    Of course, everyone expects it will be an actual, serious submission to set the next round of negotiations off to a good start, but that's not an absolute requirement. Negotiations on what's eventually in this list won't be finalized until the four months have passed. As I've noted elsewhere, the EC are going to avoid making any actual decisions for as long as they possibly can.

    This is a great example of why it's important to go to the source. The news media have gotten nearly everything wrong, resulting in widespread misunderstandings.
    Feb 21, 2015. 06:24 PM | 2 Likes Like |Link to Comment
  • Unconventional Fracking: Changing The Future Of Drilling [View article]
    Reading this article, I was also thinking H2O conservation is already a huge environmental benefit, Frank.

    Not sure if aquifer contamination would be less...I presume contaminants can still migrate along the same fault lines that carry H2O, but possibly there's a benefit in using a different fluid...just don't know. A possible concern is the greater miscibility of CO2 might result in it carrying more organics to wherever it does travel.

    CO2 might have less tendency to induce small tectonic movements, although those never seemed a big issue to me.

    A possible environmental negative might be ground subsidence if CO2 migrates away from the extraction site more rapidly than water. Again, I don't know, just mentioning possibilities. Ground subsidence reduces aquifer capacity, so it's worth understanding.

    Cost to compress seems a non-trivial consideration...a detailed accounting of the costs and benefits would be very interesting.
    Feb 21, 2015. 05:00 PM | 1 Like Like |Link to Comment
  • The Biggest Risks To Stocks In 2015: A 10-Point Analysis [View article]
    "Why should anyone care"

    You're quite right about the magnitude of the money in a global context. But that alone should tell you the reasons lie elsewhere ;-)

    Greece's debt alone doesn't matter, but the whole of the EUM block does. NATO also matters. If you dig a bit into the background, you'll find discussions as to how potential outcomes for Greece might change things that do matter in a global context.
    Feb 21, 2015. 02:32 PM | Likes Like |Link to Comment
  • The Biggest Risks To Stocks In 2015: A 10-Point Analysis [View article]
    " Don't know any method he used for finding tops. Far as I know, EWA is the only tool capable of that independent of other tools."

    That's because the concept of "top" is ill-posed.

    The broader market does not have "a top". It only has local peaks that, in retrospect, preceded each correction before heading higher. And even these local peaks are scale-dependent. A peak at one scale may not exist at another scale (see Lindebergh on scale space in signal theory).

    EWA is useful because it takes scale into account. At every scale, there are local peaks. You need to start by defining your scale of interest...but no one does because that itself is problematic. Your scale of interest for local peaks will depend on what comes after, which of course we don't know yet.
    Feb 21, 2015. 02:16 PM | Likes Like |Link to Comment
  • MBA Mortgage Applications [View news story]
    Pogo study looks like a good reference. Thanks, Minutemen.
    Feb 21, 2015. 02:10 PM | Likes Like |Link to Comment
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