The Goods of Today:
- Major Indexes are at highest level since December 2007, back to pre-recession level
- ADP says US Company added 201,000 workers in August
- US ISM Non-Manufacturing index 53.7 vs 52.5 expected.
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J.P. Morgan Chase (NYSE:JPM) experience a huge appreciation today , along with other banking companies, due to ECB movement. I keep mentioning JPM particularly in the industry because it has low PE ratio and healthy revenues. Despite of the huge trading loss early in April, I like the attitude how CEO Jamie Dimon responds to the trading loss with a tone of accepting mistakes and problems existed, instead of blaming others. I am skeptical about Europe’s bond-buying program, but JPM is definitely in my watch list.
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UVXY had been in my portfolio for a long while, not only because the economy is recovering and indexes are doing good, hence the volatility would be small. It is also because the contango relationship in spot and distant futures prices. Today’s action makes UVXY touches the lower B-band again, giving us a sell signal. If you are expecting volatility to get smaller in the future, short UVXY, TVIX, VXX or similar ETN or Long XIV. One reason I like shorting VIX instead of Long a fund shorting the underlying futures is that there would be less short squeeze effect on the particular ETN, making it easier to predict the outcome.