Saturday, July 31, 2010

Random thoughts.....ICAP and market worries

Have been away from the country for a few days. Got sick during the trip and has been on the bed for the whole day. Felt much better after taken medicines and much needed rest.

The first thing that I picked among a stack of unattended letters was iCapital 2010 annual report.

Despite of him claiming his bullishness and employing value investing-style, there is no denial that he is also a market timer. Just look at his cash YoY, gone up from 37 mln to 103 mln after selling a lot of the holdings. Cash/total net asset %, 2009 was 19% risen to 44% 2010. No need to bash him but just exploit the fact that he has short term worries. It's also mean that iCAP NAV will be likely flat in either direction of up or down.

One of the divergences that I observed but has not been able to figure out was direction Japanese Yen strength, usually an indication of risk aversion or may be just undergo a bottoming process?

Copper rallied, a good sign that global economy is okay.

Solid earnings from Fedex and Ups signaling the world is okay.

Gold corrected, a sign that risk appetite should be improving.

To be honest, most data looks very okay except Japanese Yen strength is nagging at me for the last few days. I hope things will be clearer in 5 - 10 trading days.

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