Well, I guess by saying on Tuesday I’m planning to write a comment when the stock index closes up or down 1% or more I’ve turned myself into a regular ole Mark Twain.
If you’ve ever read the “about” page, I poke some fun:
Mark Twain’s mother once said:“I only wish Mark had spent more time making money rather than just writing about it”.
I go on to say:
Today there is no shortage of writings about the capital markets and portfolio management. Many who write about money and the management of it provide no evidence to suggest their beliefs are useful. That is, they do a lot of talking and writing, a lot less doing. We are left to wonder if they have good results. The author of ASYMMETRY® Observations is no Mark Twain.
Ok, so March isn’t getting off to the best start so far. The stock market as measured by the S&P 500 closed down -1.45% today. Below is the intraday chart. This index was down most of the day, but it did trend up off of its low after 2PM.
Zooming out to a few months instead of intraday, the SPY didn’t care at all that I drew that black line to show the prior low. It traded right below it. Of course, we don’t own this index at Shell Capital, so I am just sharing this as an observation.
We can get more granular by looking at the individual sector changes instead of the broader S&P 500 index that includes some of them all. Below, I show that the Utility sector was the only sector in the green (barely), which is no surprise since it has been the laggard for a while.
We can drill down even more into the sectors and see the ETF subsectors. Here we see some shades of green.
Next, we could look at stocks within the sectors, but that’s enough detail for now.
I will add that today was a global market decline as several other countries stock markets participated. Japan declined more while Mexico, Peru, and Egypt gained. The emerging markets index which includes Mexico only declined -0.19% today.
Finally, below is the same table of bar charts I used earlier in February Global Market Trends, but this one is only the past three days. The U.S. stock market has declined the past three days, so I wanted to see what other markets have done over the same period. Let’s just say that a diversified portfolio of global asset allocation wouldn’t have helped since many markets are down like commodities and international markets.
If you haven’t read February Global Market Trends I encourage you to. Near the end, I discussed if an investor should pay too much attention to daily market swings. My purpose of writing this is to summarize what happened and that is always necessarily in the past. The future may be different.
How does this affect us at Shell Capital? I predefine my risk by knowing in advance when I’ll exit my positions if they decline. I do it to control my risk in each position and for drawdown control at the portfolio level. So, I respond accordingly.
If this keeps up, it looks like I’ll be eating dinner at my desk every evening, typing away like Mark Twain 🙂
Mike Shell is the Founder and Chief Investment Officer of Shell Capital Management, LLC, and the portfolio manager of ASYMMETRY® Global Tactical.
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Investment results are probabilistic, never a sure thing. Past performance is no guarantee of future results.
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