Recap & Outlook: A Recap of Views Shared so far in 2023 (Opened to the Public) - Understanding Intermediate-Term Investing
Recap & Outlook: A Recap of Views Shared so far in 2023 (Opened to the Public) - Understanding Intermediate-Term Investing
Premium Resources opened up to Public until the Weekend is over.
Note to Readers: As we wrap up a tremendous January, I believe the easy money for 2023 has been made. For this reason, I want to take a moment to share exclusive research for you this weekend, and open up several premium posts I’ve written to my members. Once Monday starts, these posts will be made back to Private. I will have more Strategy posts for Members on Patreon/Private Substack as markets progress - stay tuned.
This accomplishes 2 things: 1.) I get to help more people & practice the Good Karma and 2.) You get to understand the views I’ve shared so far, plain and open.
My goal is to share with you my methodology and its outcomes. If I win, I will inspect why. If I lose, I shall also inspect why. This is a game of probability, not one of certainty. To me, methodology is king. What is repeatable has enduring value.
If you appreciate my efforts to help you, please help me grow our Community by pressing the share button below.
Public Friends,
By this point I’m sure you can tell that I’m strongly invested in your success and well-being. As markets are at a critical inflection point, more and more people are reading my work to garner a diverse set of viewpoints on where markets go next.
This weekend, I wanted to share with you several research posts that I sent over to my members on Private Substack/Patreon (links below) in the last 2-3 weeks so that you can see my views vs. how markets materialized. As mentioned above, I am interested in sharing with you how I think.
The reason I do this is to show you clearly that my style is Intermediate-Term investing (3-6 month target timeframes, 9 months if necessary). This timeframe is my specialty. It is where my accuracy and conviction is highest. I personally believe that my strategy in this timeframe is distinguished in the marketplace.
My sharing with you what my methodology is also helps you to understand if I’m the right Strategist for you.
About 70% of opinions shared in my Investment Community are designed for Intermediate-Term Investing. About 15% will be near-term (several days/several weeks) opinions, and the remaining 15% will be long-term ideas (past 9 months).
In all my guidance, going forward, I will always make clear what’s the timeframe that it may take for certain targets to materialize: Near-Term, Intermediate-Term, Long-Term.
Given that I think market risk/reward is greatly against Bulls in the Intermediate-Term (looking out 3-6 months), I wanted to take a moment this weekend to help the public friends with sharing my content.
All paywalls have been removed for the weekend. They go back to Private on Monday.
So, if you have 20-30 minutes this weekend, get a cup of tea, and enjoy!
Premium Note 1: February Strategy (Part 1 released on 1/26) - Link here Paywall removed until Monday
Core Views Expressed
Opinion 1: There is near-term momentum for Equity Bulls in the context of a larger decline that I believe will happen.
Opinion 2: Execution methodology discussed to stay in markets to ride upside, despite bearish “view”.
What worked in my favor: Continued SPX upside as execution methodology kept me in the market.
What worked against my favor: Rather large opportunity cost in TSLA as it skyrockets well above levels that I had anticipated.
Premium Note 2: Strategy Note BEFORE Fed FOMC (Released 1/31)-Link here Paywall removed until Monday
Core Views Expressed:
Opinion 1: Risk/Reward for equity markets is fading, but to stick with execution plan and not sell down exposure (yet).
Opinion 2: Personal belief that Dollar (DXY) would stage a recovery with implications discussed. Then 102. Now 103. 100 basis points is very significant on a currency move.
Opinion 3: Believed Gold at 1930 was Overbought and vulnerable to pullback. Now 1860.
Opinion 4: Get cautious on China in immediate near-term. Long-term staying constructive
Opinion 5: American Express is overbought and its stock doesn’t make sense in white-collar recession.
Opinion 6: Discussed ZIM (value name, NOT growth) as searching for a bottom at 19. Now 23
Opinion 7: CF Industries (value name, NOT growth) looks attractive to me at 84. Now 86.
What worked in my Favor: Opinion 1, 2, 3, 4, 6, and 7
What worked against my Favor: Opinion 5
My very small hedges on high-beta (NVDA, MU, DIS, SHOP, and META) are a drag on my longs. However, I intend to keep hedges on. I believe high-beta will see an air pocket when people least expect it.
As you can see, I am very focused on constantly improving my methodology. While I of course want to improve a Win ratio, I am exclusively focused on advancing my personal edge and methodology. My win ratio on intermediate-term ideas (given 3-6 months to play out) shared within the Community is about 62-68%. My win ratio on long-term ideas (past 9 months) is at the upper end of this range, and my win ratio on near-term ideas (days and weeks) is on the lower end, around 55%-60%.
For me personally, the longer the horizon, I’ve found that my methodology works better.
To get more specific: I define a Win on the long side as a transaction that has a 5% positive ROI at any point within 3-6 months for intermediate-term ideas.
I see a lot of experts on the internet say they win 90% of their ideas. Some of them are even able to do 90%+ on an intraday basis - wow. 🤩
Well, that’s not me. I’m not able to do that. Please do not come to me expecting me to do that - I’m not able to produce those numbers.
I’m always going to communicate with integrity.
I win about 2 out of every 3 ideas, so I do have a statistical edge (anything over 50% is a statistical edge) in my 3-6 month timeframe specialty, but it’s certainly not 80% or 90%. I’m completely objective about this.
I am definitely not interested in trying to win them all or even to maximize returns for that matter.
I am interested in following a repeatable methodology and raising the Sharpe Ratio of my own performance, and also for those that I take care of inside my Community. Please understand that my goal may be different and most likely is different from yours.
My Strategy at this moment in time is very focused on Capital Preservation and attempting to seek tactical well-thought out risk-ADJUSTED returns in a market that I think is generally dangerous and now very overpriced.
I share my research to help you navigate this bear market. My pricing in my Community clearly conveys that I’m here to help people at a globally accessible price point. At the moment, I have no “tiers” in my membership, so everyone is treated 100% equally. Even investment professionals and financial advisors join my Community at the same price. Whether I change that policy for non-professionals vs. professionals in the future, I haven’t decided, but for now, even professionals enjoy the same rate. I would estimate that about 15% (1 in 6) of my Community are investment professionals, an extremely high ratio for a retail investment Community that I’m quite proud of.
I practice quite a bit of good karma every day to the public. I would appreciate it if you share this email and help me grow my network to help more folks if you appreciate my work.
Most of all, I hope to help you avoid being the exit liquidity to institutions that has plagued retail folks for much of 2022 (and soon to come, in 2023).
~Larry
Let’s Connect on Social/Resources (Don’t fall for impersonators, please):
Twitter: https://twitter.com/LarryCheungCFA
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My Brokerage: Interactive Brokers