Yesterday was a huge day for me, not because my shorts on the market exploded to incredible one day gains (see Wednesday's issue entitled, A Time to Reverse); not even because my longs on the VIX (wow) and my hefty position in gold soared to amazing new highs. No. It was a monumental day for me because for the very first time, my 12-year old son showed more interest in what was going on in the stock market than in how many enemies were wounded by Gunny Sergeant Jones, his alter ego in Call of Duty, a popular video game.
Moments after the close, Oliver, Jr. burst through the front door ahead of his mom, flung his book bag up the staircase, deftly landing it on top of the 14th step, just inches from his bedroom door. He's so accurate with that thing. He then turned 90 degrees right, dashed into my office, out of breath looking very concerned. "Dad! Dad! Are you short???" At that very moment, a rush of different thoughts and feelings battled for dominance in my mind. I knew this was one of those Kodak Moments, a moment that would be remembered by him most of his market life, like the time I remembered when my dad was long gold when it soared to 800 in the early 80s.
"Of course I'm short, Ollie." After I said it, I realized the words came out with that tiny touch of fatherly superiority which most dad's know so well. "See, I told you he was short," said his mother who had finally caught up. Wrapped in silence, he turned to look at his mom, then turned back to me, broke into one of the biggest smiles I've seen from him in a long time, and bolted out of the door at the speed of light, undoubtedly headed for his trading tool, the Mighty Xbox. It was worth infinitely more than all the profits gained from being right on my Wednesday market timing call. That moment represented the only true wealth that matters. It was gold...on steroids.
The Shot Heard Round the World
My bold market reversal on Tuesday (reported in Wednesday's issue) could not have been better timed. Not only did it perfectly hedge my long portfolio, it turned what could have been a very painful event into an occasion to rejoice. The gains derived from the shorts far outweighed the effects of the setbacks in my longs, and that's not always easy to accomplish. Let's take a look at them now. But before we do, let me inform you that this environment is perfect for stepping up one's accumulation efforts on the long side. Please don't naively assume that market trouble is a time to flee the buy side. In fact its just the reverse. It's more the time to dig in and increase one's appetite for longs. Think Warren Buffet. Not Warren Beatty. A full play update will be forthcoming this weekend. Please don't miss this all important last public issue.
The Winning Short Plays
This weekend will mark the very last public issue of The Velez Opportunity Report (VOR). It has been a wonderfully profitable ride, with numerous 200% plus winners, along with a slew of 100% doubles. While some of our most recently initiated open plays are in their infant accumulation phase, I'm proud to report that the VOR has booked and closed out gains on 100% of its plays since inception. While we still have our work cut out for us, that is a feat rarely accomplished in this industry. And it's just the beginning. The Wealth Game is starkly different from the short-term trading game. It requires a different mind-set and at times a radically different approach. The laws of wealth accumulation, if adhered to, can lead to a level of power and independence that most people who walk this planet can only dream of, much less experience.
I trust that many of you will continue to take this journey with me. Stay tuned for information on how to continue our lifelong pursuit of WEALTH, always the crowning jewel of a remarkable life in the markets.
