face-ripper
Friends,
If you reside in the quark-sized intersection of people who read this letter but don’t follow the market, I’m informing you that shares of corporations are up sharply in the past 5 weeks.
The magnitude and speed of the rally have been “hellacious” to use a mentor’s favorite way to describe the face-ripping bear market rallies. Not that this is a bear market rally. As you know, bears are extinct and all the degeneracy you see is their normal diet flourishing without a natural predator.
Now, about that face-ripper…my turn to cherry-pick. It turns out selling calls that carry a high implied vol but were in the 0th percentile of skew wasn’t really “income”.
The green line is a portfolio of 75% SPY, 25% cash rebalanced monthly which is a more proper comparison to JEPI which sells OTM calls. Rough month for the home team.
If curious here is 75% SPY vs JEPI since it launched:
The rally has people confused. What about the war? What about oil? What the f is happening in this chart:
