Oh, and the US is investing $250 billion into the banks and guaranteeing loans for the next 3 years. And the futures are ripping again.
Finally, here is a comparison of The Great Depression and The New Depression. One thing they left out... in The New Depression, the stock market rallies 1000 points.
Just to fuck with my officemates, I've decided to apply a little pressure, Internet-style to get one of them to do a blog post.
So I'm starting a new poll... if you could read a guest post from one of these manly men, which would it be? Now, I'm limited in how many choices I can give, so I'll start with the ones who show up most often on the RO report. So, if you're dying to know more about Trader L, for example, you'll have to write him in...
You can vote for more than one trader... the poll is open for a week.
Go vote... this could start a good war.
NOTE: I offer no guarantees that I can actually get an RO to post. And even if I did succeed, the post would most likely be about Dirty Yeltsins or Sneaky Castros. In short, it's quite possible that the post would be unrelated to the stock market as most of the RO inhabitants are disturbed in significant ways.
Truly, these are wonderful times to be a proprietary trader. How much longer will it last? Your guess is as good as mine.
I mean, what's gonna happen tomorrow? Do we drop 500 points to consolidate?
Volume today, compared to Friday's level, was simply lame. We traded just over half the volume we traded on Friday... to me, that means shorts covered, and some longs entered the market, but for a 936 rip on the Dow, I'm left a little unsettled.
I haven't felt so neutral on the market since I started this blog. Amidst all this volatility, that feels odd.
Anyway, I just wanted to throw a few words out here about the RO. What it is, and why we kick so much ass.
When I started this blog a year and half ago, I was a lonely trader, locked in the confines of a spare bedroom in my house, trading for a mean overlord who didn't appreciate my consistency or work ethic. I needed some trading friends. So I started this blog, and quickly roped a few bloggers into reporting their daily P&L each day.
I called it, the Virtual Office. It was very gay, however, I made some good friends doing it.
Anyway, last December, after a string of 5 or 6 bad days, my old company, run by ogres and shitheads, called me and told me to send them money. My account wasn't close to being negative, and I had been with them for years, consistently making them money. So I took this request for more capital as an affront and told them to fuck off. They told me I could leave if that's how I felt. So I split.
Coincidentally, I had re-ignited a friendship that I had long thought dead. As it happens, this friend also ran a trading company, and so I joined his office in January of 2008.
At the time, it felt awful. However, as so often happens in life, events that you at first judge to be negatives, can turn out to be positives.
The vibe in the office was so solid, with great chemistry among the traders. They shared ideas, and they shared P&Ls. Soon after I joined, I decided to scrap the VO. I mean, I now had traders who played my exact game, sharing their P&Ls. I quickly lost interest in seeing how I compared to swing traders or futures traders. I just wanted to improve my performance relative to the guys who were trading what I traded everyday... stocks.
So the RO ("real office," as opposed to the original "virtual" office) that I report each day represents the top 5 and bottom 5 traders in my actual proprietary trading office. They are gross figures and they are real.
Okay, I hope that explains it. Let's get to the figures.
Out of 27 traders today, 23 finished gross positive, or 85%. 21 traders finished up over $1,000 gross. A record as far as breadth of wealth in the office goes... I was #11 of 27, nicely positive.
The Bosses demolished the Manservants today, so they get top billing.
Here are today's Bosses:
"Lucky Pierre" - Trader A, $93,496 on 798k shares traded.
2. Trader B, $87,744 on 1 million shares traded.
3. Trader F, $55,583 on 316k shares traded.
4. Trader D, $49,273 on 682k shares traded.
5. Trader Z, $32,509 on 430k shares traded.
And the Manservants:
"Chambermaid" - Trader K, -$4,417 on 274k shares traded.
2. Trader 3, -$481 on 9,600 shares traded.
3. Trader X, -$460 on 23,000 shares traded.
4. Trader Q, -$43 on 20,400 shares traded.
5. Trader 7, $308 on 2,600 shares traded.
Thus the quiet blog.
But I want to relay a funny conversation today. Not long after my XOM destruction, "Trader D" was bemoaning the fact that he owned 800 shares of CME, 10 points out of the money.
Trader D, "I'm fucking down 10 points on 800 shares of CME."
Trader I, "Why the fuck did you buy 800 CME?"
Trader D, "I dunno! I was planning on "lightening" once I went 2 points in the money!"
And that's why I bought so much XOM. I was expecting a quick break of $66 and I would have sold some out immediately. However, that scenario didn't play out and I wasn't fast enough to act on a quick exit.
Trader D, on the other hand, probably made 20 or 30 points on CME, because he stuck to his guns. Looking back, with XOM now nearing $67, I wonder if I should have held on...
Incidentally, Trader D is currently the "Lucky Pierre" while I'm on a few slots away from being "Chambermaid."
It's a funny game we play.
As you know, the market is in constant flux. So it's important to constantly search for new ways to make money in the market.
I'm assuming that soon, this "crackhead trading market" that we're currently enjoying will give way to a kinder, gentler market again. One that rewards actual research.
One thing I have always found extremely important when I'm grouping my stocks on my screen, is to place them with other stocks that trade similarly. For example, I don't have JPM with XOM and IBM. Instead, I have JPM with the other bank stocks, XOM with the oil stocks, and IBM with the tech stocks.
One easy way to find out how "correlated" stocks are, is to use robots. Check out this link, type in a bunch of symbols, and you can find out how closely correlated their movements have been over the last 60 days. I've now blogrolled that site.
Here's an example of a search I did. As you can see, PFE is not at all correlated with the ferts.
Anyway, it's a good tool to use. Check it out, once things settle down again, you might find it useful.
Because some of you have asked, I thought I would expand the RO just this once, to show the entire office, and also to show how many trades each trader executed on Friday. I won't be publishing this data again, since honestly, I have a lot of other shit to do on a weekend. But since Friday was historic, and the RO has generated a lot of buzz, I figured I'd appease the masses.
That said, given the current crisis, and the sudden zeal for scapegoating, I'm considering changing the format of the RO away from the actual P&L figures to something more based on relative performance and a point system. I mean, can you imagine the furor if some idiot took some of these figures out of context to make a point about speculators? Call me paranoid, but the political winds are shifting, and I'm just being prudent until this all blows over.
So anyway, I'm just going to do this list in the following format... Trader, P&L, total shares traded, and total trades. From that, you can do some division and figure out average position size, profit per share, etc. Enjoy!
Trader B, $299,723 on 1,516,780 shares traded. 5,880 trades.
Trader D, $175,271 on 1,047,600 shares traded. 3,765 trades.
Trader A, $61,677 on 588,192 shares traded. 2,258 trades.
Trader F, $41,831 on 314,800 shares traded. 1,975 trades.
Trader S, $23,140 on 119,800 shares traded. 775 trades.
Trader E, $22,010 on 229,100 shares traded. 1,361 trades.
Trader G, $14,653 on 161,000 shares traded. 1,279 trades.
Trader P, $11,009 on 495,100 shares traded. 2,122 trades.
Trader L, $10,107 on 102,200 shares traded. 669 trades.
Trader J, $8,122 on 93,000 shares traded. 714 trades.
Trader K, $5,936 on 181,200 shares traded. 964 trades.
Trader X, $5,191 on 26,000 shares traded. 149 trades.
Trader C, $3,609 on 420,300 shares traded. 1,992 trades.
Trader H, $1,570 on 500 shares traded. 1 trade.
Trader O, $649 on 26,200 shares traded. 175 trades.
Trader Q, $534 on 10,600 shares traded. 78 trades.
Trader 7, $322 on 5,200 shares traded. 67 trades.
Trader M, -$860 on 0 shares traded. 0 trades.
Trader U, -$1,064 on 0 shares traded. 0 trades.
Trader 3, -$1,289 on 5,000 shares traded. 39 trades.
Trader T, -$1,294 on 6,400 shares traded. 52 trades.
Trader R, -$1,616 on 103,482 shares traded. 650 trades.
Trader I, -$2,083 on 53,200 shares traded. 383 trades.
Trader 6, -$2,136 on 0 shares traded. 0 trades.
Trader Z, -$2,651 on 671,310 shares traded. 1,954 trades.
Trader N, -$3,046 on 23,200 shares traded. 166 trades.
Trader V, -$5,526 on 95,600 shares traded. 535 trades.
NOTE: Traders that show "0 shares traded and 0 trades" are swing accounts that didn't execute on Friday.
Let's see how this turns out, shall we?
Also, when I get some time this weekend, I'm going to post some bonus stats from the RO from Friday's trade.
If I was playing strictly by the rules, I would have picked today's song because Trader B didn't double the #2 guy, Trader D. However, since the dude made such sick money, I decided to give him today's song. But then he skipped out of the office and didn't choose. Instead, Trader D picked this tune. Enjoy it.
I'm assuming you know what happened in the market today, but just in case you got drunk early, here's a quick rundown.
We drop 800 points in the first 5 minutes of trade. In the next half hour, we rip, and take back 600. By noon, we've dropped 700 off our highs. For the next 3 hours, we trade in a relatively tame 400 point range. Then, at 3pm, we're off to the races, jumping an amazing 900 points in 40 minutes. At 3:40, the MOCs come out predominately to the downside, and we drop a quick 500.
I won't say it was a "rollercoaster ride," because that implies it was fun. It was sick, and it was historic. If you traded today, you can say that you traded the single most volatile day ever recorded in stock market history. The high on the VIX was 76.94.
In short, it wasn't a day for the light-hearted... not even close.
The volume was big. 3 billion on the NYSE. I think it would have been even larger, but to make the day even more beleaguering, in the last 20 minutes, there were some street-wide data problems. A number of traders in my office got really, really screwed because of computer and data feed issues. On a day like today, that kind of goes with the territory, but it still sucks.
The morning felt very much like a bottom, but it came too early. The fact that we drifted back to the lows and then had that ridiculous rally at the end of the day, is a good sign. The one problem, was that nauseating 500 point drop in the last 20 minutes.
That shouldn't be overlooked and it's quite possible we need to go lower before this is over.
So going into next week, I have no strong feel. Given the close, I think that perhaps the best way to make this stick, would be to drop a few hundred points below Dow 7882, today's low, and then snap back to close at the high of the day. However, it's also possible that 7882 was the bottom afterall... sorry, but at this point, only time will tell.
Some good news over the weekend could help to clarify the situation.
Anyway, it was an excellent day for the RO, especially for Traders B and D, who sprayed, massively, all over the entire office. Out of 27 traders today, 17 finished gross positive, or 63%. 9 traders finished up over $10,000 gross, however, 9 traders also lost more than $1,000 gross. I'll take that ratio any day.
I was #5 of 27, or, a motherfucking boss.
Here are today's Bosses:
"Lucky Pierre" - Trader B, $299,723 on 1.5 million shares traded.
2. Trader D, $175,271 on 1 million shares traded.
3. Trader A, $61,677 on 558k shares traded.
4. Trader F, $41,831 on 315k shares traded.
5. Trader S, $23,140 on 120k shares traded.
And the Manservants:
"Chambermaid" - Trader V, -$5,526 on 95,600 shares traded.
2. Trader N, -$3,046 on 23,200 shares traded.
3. Trader Z, -$2,651 on 671k shares traded.
4. Trader I, -$2,083 on 53,200 shares traded.
5. Trader 6, -$2,022 on 100 shares traded.
Get some rest.
Over on Ray's blog, (he's a big fan of Dinosister, btw) I asked him what the feeling has been like on the exchange in the last few days. He offered this very eloquent response.
I'm usually there for the open and the close, and the faces I see at those times are driven, intently watching and working the news stocks. There's a sense that the news is huge every day, and that it's all around us, from the feds, from the companies, from overseas, all at the same time. People are walking a little faster and talking both a little faster and a little louder. The sound of a broker tapping a stylus on his wireless order-management device is a little more staccato. Brokers seem like they've got a lot more orders to work, or bigger orders. There are more and bigger crowds around specialists. It feels like people are in overdrive.
Here's a link to the intraday chart of the Dow when it crashed in 1987.
We'll see how today ends. My guess is that we're not done yet, but it's hard to position aggressively one way or the other right now.
-Shill.
Fire this idiot, CNBC. He has only succeeded at muddying the conversation for the last year.
Seriously people, let's start a campaign. Let CNBC know you don't appreciate the bullshit.
Listen, can I just say something here for a second?
It's gonna be okay.
The stock market can crash and you can lose all your money in it, but only YOU can lose your own perspective.
People are freaking out. But don't let that mob mentality, exacerbated by the idiots on the TV, get to you.
And I'm not just talking about the market. Let's get control of our emotions with these fucking politicians. They're all assholes. Democrats and Republicans.
Anyway, here's a song about perspective. The message is, "Nothing's gonna change my world." Remember, you're in charge... keep your emotions in check.
Here's a link to Art's interview this morning. Needless to say, I agree with him almost 100%.
"We have several tough years ahead of us."
You want to see what capitulation selling looks like? Take a look at any number of stock charts today. The blood is officially on the streets.
I don't normally do this, because it would be really boring if I did it everyday, but here are some very important statistics. Since September 1st, check this out:
