Starting to be fearful of any continued (short) equity exposure. Markets have gone down 30+%. At some point they will bounce. Still short, and with loose stops because intra day fluctuations are large. Covid-19 is a severe headwind for the global economy. The big worry now is that markets will be closed and the authorities will bring out the fiscal bazookas (or howitzers) just at a time where I am locked into unfavourable positions.

In recognition of the risks of fiscal action, I started to short some govvies. GBL and R. Not large positions.

As of 10:35 equities are down:

• DJ600 BY 2.5%
• es 0.75%
• FTMIB by 5.66%
• HSI by 2.4%
• RDXUSD by 4.3%
• SX7P by 3.5%
• TOPX by 1.7%

(Actually, these were noted a while ago. There has been a bit of a bounce in the last half hour which cut your gains in half. Currently, you are up 0.8%: effectively a rounding error in today’s stormy weather.)

11:07

Decided to put on a number of stop and limit orders to scale back risk in the face of further volatility. Generally, the futures had stop orders, the larger option positions had limit orders. Generally, the limit orders will show a healthy profit. The stops should contain the positions to modest losses. These were all trailing stops, so if the positions make further profits, these should be locked in.

14:33

Markets are skittish today. At around 13:45, which

16:32

Bought 10x DX! Have been seeing something about how USD is in high demand as people try to refinance their debt. Slightly spur of the moment. DX has been strong. Finally acted on the dollar milkshake theory.

Sold UBER shorts, to reduce exposure.

ES stopped, BTP, TOPX all triggered stops. Brutal upswing in equities, now showing $82K loss. In a classic example of making trading decisions according to frame of mind, rather than a system, I’d been reading some dire article on disease spread modelling by Neil Ferguson and others. Lots of things are closing down. Seems like the end of the world!!

You’ve made some money, but it seems clear that you are trading too much. Test now is to see if you can leave TWS well alone until tomorrow. One bright spot is that your short bond positions are looking healthy: GBL and UB.

16:50

That didn’t last long. Sold some LQD cfds and bought some XLF puts.

17:15

On down days, the temptation to change one’s mind is almost irresistible. It’s like Odysseus stopping up his men’s ears with wax and being bound to the mast of the ship. The Market Wizards interviews all have traders going on about how important it is to stick to ‘a’ system, almost irrespective of exactly what system. I guess the greatest sin is to change horses in mid-race.

18:21

Put some extra stops on R and GBL.