There's no Prickly Pete

Prospero.Ai Special Market Update

We decided to share our trading letter from today for free here too because we think it is helpful to investors and traders alike!

I am a big Seinfeld fan. And perhaps my favorite episode is the one where George Costanza has a fake house in the Hamptons. At the end he is caught and he lists all the lies he made on the drive up about his fake house. Including my personal favorite, his fake horsePrickly Pete. Some days where there aren’t very good signals I do not write letters but I wouldn’t do that to you all today.

Our model portfolio has fared pretty well today actually. But even the SPY and QQQ Options Sentiment plummet warnings did not save our investing letter picks. We had a good process, we were 11 short and 6 long heading into today. But after many up and down weeks for large cap growth longs they were straight up slaughtered today.

We will write more about this in our weekend letter but it is a real Catch-22. Typically when yields rise it is trouble for growth stocks but AI has been carrying large cap growth. So do we bet on the horse that has been winning races this year or the one that has won more races historically? Typically our strategy is to stick with what is working now and balancing that with long term data. So we have no regrets about today. We had the right process in our minds and there is always some luck to investing along with skill and the dice roll did not go in our favor. So in our best George Costanza voice for today.

THERE IS NO SCREENER, NO MARKET ANALYSIS, NO SECTOR ANALYSIS.

We did make this letter for everyone that pays or not because we think the Catch 22 message is important. Are people taking profits because of global concerns? Or do they think AI is overvalued and the game of musical chairs is over for now? Anyone that tells you they definitively know the answer to this is a liar and not a good one. So we have paired down our positions today in a great many chats. Thanks to Brent our portfolio assistant for not reporting me for workplace abuse lol.

My advice to you is to do what I’m doing. Pour yourself a Beer or a glass of Wine or whatever your poison is and prepare yourself for a tough Monday. I can tell you from conversations I’ve had today that people on Wall St. are feeling the same trepidation you are. Trepidation means indecision, it means volatility.

Fear not we will be publishing a brand new strategy that manages risk in this tough market on Sunday!

For now talking or stressing about the market is about as useful as making up fake horses.