19 September 2016: An ambiguous mood

Also after the Fed’s meeting, the mood among investors will remain ambiguous.

swordIt was an interesting week last week. All major US indices ended the week in a minor key, but booked small gains for the week nevertheless. Volatility was also on the rise. The possible interest rate hike that is hanging over the heads of investors like a sword of Damocles is to many of them a big reason for concern. The crowd cannot decide where to go, so we end up with a rise of both stock prices and volatility.  This week’s Fed meeting will clarify things. But for how long? The announcement of a rate hike might bring stock prices down, but after a recovery from the shock, the prospect of an improving US economy might generate a renewed appetite among investors. If the Fed decides against a rate hike in September, stock prices will certainly get a boost in the short term. But after that, the uncertainty surrounding a possible rate hike in December will introduce new volatility. It is clear that in both scenarios the general mood among investors will remain ambiguous. We should prepare for more weeks like the previous one.

white-chapel-logo-smallAll major US indices posted small losses last Friday. But these losses could have been much larger. In the last hours of trading, stock prices made a turn to the upside. Volatility eased as a result. Our UVXY ETFs posted a loss of a couple of percents, having been positive for most of the trading day. Return for the year is now 306%. In comparison with a week ago, it gained almost one hundred percentage points. Our model White Chapel is still convinced about the likeliness of more volatility coming up. So it gave no signal at the end of Friday’s session. We can hold on to our UVXY ETFs with confidence.

Accumulated capital at close of previous trading day

Return since start

Return this year

Return this quarter

$40,641

+306.41%

+306.41%

+19.7%

Our initial capital was $10,000 at 1 January 2016. Our average Annual Return is 638%.

silhouetten these dutch guys klein

55-year-old Nigel Mills of Essex, England, has recently been clocked speeding while driving on the A12 near Margaretting. Normally, this would not be much of a news item. But in this particular case, the car in question was a DeLorean and its speed (according to the police report) was 89mph.
As you may know, the DeLorean was the iconic car from the Back to the Future film trilogy, that turned into a time traveling device once it reached a speed of 88mph. Mr Mills appeared before Chelmsford magistrates and protested his speeding ticket, stating “I can honestly say I was not trying to time travel.” His case was dropped after the police officer who clocked him speeding ‘failed to arrive in court’.
We guess Mr Mills must be a very smart man. Maybe he wasn’t ‘trying’ to time travel. But he just did.