21 October 2016: Rate hike fears will resurface

8383% of the companies which reported earnings haven beaten expectations. Earnings season has not disappointed so far and has kept investor’s attention away from speculation about central-bank moves and election results. For a few days, that is. It might feel like earnings do matter again, but nothing could be less true. Rate hike fears will resurface and it might happen as early as today.

white-chapel-logo-smallAll major US indices lost their upward momentum during Thursday’s trading session. The S&P 500 lost 0.14%, the Dow 30 lost 0.22% and the NASDAQ around 0.1%. The VIX ended lower by almost 4.6%. Our XIV ETNs gained over 1% nevertheless. Return for the year is now 244%. Return for the quarter stands at more than 12%. Our model had a good week: our XIV ETNs made good profit by riding a wave of easing volatility that lasted four days.

Trading signal: as a result of a change of momentum, White Chapel gave a trading signal at the end of Friday’s session: a “V” (volatile) signal. As a result of that, we sold our inverse positions (XIV ETNs @39.06 ) this morning and bought volatile ETFs (UVXY ETFs @15.01).

Accumulated capital at close of previous trading day

Return since start

Return this year

Return this quarter

$34,424

+244.24%

+244.24%

+12.4%

Our initial capital was $10,000 at 1 January 2016. Our average Annual Return is 374%.

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René’s Reflections @ Friday: Ceci n’est pas une réflexion

Ah, Friday again. I have a lazy weekend looming right in front of me. No early morning alarm clock. No obligations. No deadlines. No rush hour traffic. No work. No pressure. Just shrugging off the working week, and chilling out. Doing nothing. If I want.
But wait, it’s still Friday! Uh-oh! So I’m supposed to write my “Reflections @ Friday” today. And I can’t skip that. Or can I? No, I can’t. Or I could, but I shouldn’t. Because on Fridays, tradition has it that we close the trading week with my “Reflections”. Only in case there is a good reason for it, I am ‘dismissed’. Like on 2 September. But today, there is really no excuse whatsoever to neglect my duty. So I will prepare myself a strong cup of coffee, sit down and write my Friday’s Reflections. Now.
Having said that, what would it be like if I just skipped for today? If I just drank my strong cup of coffee, and kicked off my weekend right away? My best guess is that no one would notice. And in case anyone would notice, he or she most probably wouldn’t care at all. And in the most unlikely event that anyone would mind, it would be nothing more than a minor annoyance. That is a reassuring idea. So maybe, one future Friday, I might be tempted, be it only for once, to skip writing my Reflections. But not this time! Have a good weekend. May the Volatility be with you.

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