Friday, May 1, 2009

Short-Covering Rally Data Points

On March 9th I put together a portfolio of ten highly liquid stocks and ETFs that had extreme short interest positions. I posted about this portfolio the next morning in Short-Covering Driving Today’s Gains.

I thought this would be a good time to share the performance of these heavily shorted stocks and ETFs during the course of the past 7 ½ weeks. I have the graphics below from Finviz.com to show how the portfolio has performed. As a bond ETF, TLT probably should not be in the group, but since I included it in the original portfolio, I’m leaving it in here for now. For what it’s worth, removing TLT from the portfolio pushes the total return up to 116.60%. Clearly, a large part of the recent gains have come from short covering the likes of Deutsche Bank (DB), MGM Mirage (MGM), and shopping center REITs Macerich (MAC) and CBL & Associates (CBL).

[source: FINVIZ.com]

6 comments:

Anonymous said...

Good for you. I want my money back. :)

Pankaj said...

Congrats Bill.. Nice gains.. Is this your real portfolio as well?

Cheers,
Pankaj

Bill Luby said...

The Finviz portfolio was not a real money portfolio I put together, but I did use it for idea generation as well as a short squeeze barometer.

I am generally very reticent about sharing specific trades I make (once in awhile I will mention something on Twitter), because I always envisioned the blog as more of a learning vehicle than something that might be construed as a source of stock tips.

In any event, 2009 is off to an excellent start for me, for both long and short positions.

Cheers and good trading,

-Bill

Anonymous said...

after this huge rally the 200 day is 963 and the SPX is still a low 877.

what a rally yet we're still below the 200 day.

AE said...

COT data suggests the same

http://alphaedge.wordpress.com/2009/05/01/cot-report-shows-rally-purely-short-covering/

Bill Luby said...

Thanks for the heads up, AE. BTW, I checked out your blog and was very much impressed. It is definitely a candidate for my blogroll once I spend a little more time kicking the tires.

Nice work!

-Bill

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