Cut $HOOD for breakeven.

Added shorts on $SMH @ $230.56 & $NVDA @ $118.91. Keeping ~29% cash on the sidelines for now

I don’t think this is the end to the correction yet. Something about the market sentiment feels off to me. Nasdaq is -5% from ATH but I’ve seen people calling it one of the worst corrections.

NVDA has been one of the easiest and most crowded longs for 2023-24, for good reasons. I think the path forward in 2025-26 is significantly more volatile and uncertain for the stock & the wider semiconductor value chain. I think many market participants may not be prepared for that scenario, and unsure of what to do if buying NVDA/semis isn’t a sure win to ride the AI wave.

Not calling for the top of the AI wave, it’s perfectly fine to get mini booms and busts cycles within a huge megatrend. We may be seeing a small bust now, so I want to have cash ready to buy the trough to continue riding the larger trend.

Could be totally wrong here tho, just making this my journal diary

Current positioning remains LONG China Tech/Semi, SHORT US Semi/AI Infras/high-end consumer.

IMO, what’s happening these few weeks isn’t the market pricing in a specific factor; tariffs, doge, growth scare etc.

What’s happening is the market pricing in 4 years of uncertainty, by an unorthodox and volatile president. Similar to the taper tantrum of 2013, but on a larger scale. Everytime Trump speaks, market dumps or pumps.

It’s my top down framework for why I’m LONG China / SHORT US for the time being.

This is my bigger concern regarding this correction.

An Ouroboros where the health of the economy is dictated by equity prices. In short, rich people account for a disproportionately large % of consumption spending. Rich people hold a disproportionately large % of their assets in equities. When equities dump, rich people feel poor and cut spending. Knock on effect on real estate, hospitality, luxury, high-end consumers, discretionary etc. You get the idea. Also, US GDP is predominately driven by consumption spending (68% vs 39% for China and 53% for EU)

To get the point across, according to Grok (Un factchecked), top 20% wealthy in U.S. accounts for ~40% consumer spending in U.S. Top 20% holds 87% of all shares in the market. You get the idea.

So while I’m not too worried about this correction (though ~60% probability in my mind, that we have seen the top of NVDA), the extreme bear case — if Trump doesn’t stop his volatile rhetoric before lower equity prices get baked in consumers’ expectations — is a growth scare/economy slowdown. I put this bear case at 30-40% probability in my mind. Not high, but noteworthy.

So there’s no need to pick up pennies in front of an incoming train.

Partially covered some SHORTS yesterday; $VST @ $120, $APP @ $318. Covered fully $NVDA @ $112.

Reasoning is that I think in the short-term, there is less downside left than upside callability. Bad news has already been front loaded, but if Trump walks back the bad news, there’s upside optionality left in prices.

At the same time added more LONGS; $BABA @ $129 & $131, $HOOD @ $43.4. China has remained relatively strong through this entire tariffs fiasco - they’ve been preparing for tariffs ever since Trump got elected. 20% might actually even be a bull case for them as Trump’s initial narrative was 50-60% tariffs on China.

Huge stimulus plans out of China

Choose your fighter: China with stimulus or U.S. with Trump

Rebuilt $BABA to my highest positional amount yesterday, $1810.HK @ $52 today to levels before trimming.

Gobbled more $HOOD @ $45-$47. Liking $HOOD more and more. If you think about it, they are pretty much the only company that’s right in the middle of equity + crypto. That and a large customer base that basically wants to degen 24/7. Very well-positioned for the tokenization wave for real world assets, if it comes. If it doesn’t, that’s fine as core business is still strong and ancillary businesses (crypto, RIAs, credit cards) are growing and taking share.

Also started to rebuild $RKLB position @ $19.65. Part of my “Take Trump seriously when he speaks” thesis. Market usually thinks he’s just yaba yada, but if you actually just invested based on how and what he has spoke, you’d be rolling in cash atm.

$BABA up 9% in U.S. hours. Seems like US -> China rotation from U.S. investors. Gaining more foreign bullievers it appears. Looks ready to go higher.

If you have been observing, there’s some alpha on which hours the China stocks are pumping, which can give insight into flows. Stocks like BABA are listed on U.S., HK, and the Southbound Connect which connects to China. The hours that it pulls back or pumps, can tell you which group of buyers is buying or selling in the ST.

Fully covered $VST @ $116 and $APP @ $257. Beautiful shorts. $APP was one of the best; first short entry was @ $442.

I think $APP has more to fall tbh, but I’m happy expressing that view via a $U long as I think we might get a ST technical market wide bounce.

Someone I have lots of respect for wrote about the winner’s and loser’s game today. I think there’s a lot of resemblance to the markets today, and life in general.

In short, a winner’s game is a game where you have to do more, perform at your best to win, put on your best performance, maximise edges whenever possible etc. Counting on yourself to make good plays to come out ahead.

A loser’s game is one where you have to not lose, to outlast, to win. Survive volatility, temper risk, manage greed. Counting on your opponents to make a mistake, to come out ahead.

I believe the U.S. markets today is that of a loser’s game. People have been conditioned to buy dips for years, but if you take Trump’s words as it is (a surprising source of alpha), then we are in for some rough times for a while. Many will chop their portfolio up trying to trade this, with nothing left to capitalise on cheap stocks at the trough.

Dont be that guy. Decrease turnover, increase quality of plays. While it’s not obvious at first glance, markets are also zero-sum like tennis. Your gain comes from someone’s loss. It’s PvP in nature, and sometimes you can come out ahead simply by surviving through the tough times (while everyone else offs themselves trying to trade the chops), and having cash ready to buy the troughs.

Needless to say wrong on ST technical bounce.

But overall made it out ok as we started entering shorts on 22nd Feb, and got more aggressive on exiting US longs and doubling down on US shorts over the next week after NVDA’s earnings. This helped to protect our YTD%.

China has been a good hedge to US momentum; some contagion drawdown there on our longs but relatively speaking, doing ok.

Started building out an EU defense/infrastructure basket too, on shifting geopolitical tensions. Little late for this, but I could see increased EU fiscal/defense spending as a sustainable mid-term trend.

I also don’t think that was THE top for US stocks, and while we might take some time to reach the bottom, it might be good to start keeping a watchlist for potential AI software winners (AI Phase 2) that are going to be/already is on bargain.

Fully covered all shorts except for $FIVE.

Rebuilding longs on $HOOD @ $36 and $U @ $21.9. Risking the biscuit for a ST bounce. I’m okay with knife catching a little as we have sidestepped most of the past 3wks correction.

Trimmed ancillary China positions here — keeping $BABA. Added more US longs in pre-m ($VST @ $115, $HOOD @ $37).

China getting a little too consensus, thus the trim.

U.S. economic uncertainty index hitting COVID levels.. This feels too much to me.

In the ST, the r/r on US longs seems higher to me. Basically how much worse can sentiments get in the ST?

- Trump is already spitting the Tariff word 200 times/min
- Canada is not backing down easily (hence market already pricing in a protracted trade war vs 1 week ago when market expected tariffed partners to back down quickly)
- When Trump’s team has essentially repeated everyday that they want stocks lower

Simply put, there’s more upside cases to be made here imo; Trump walks back tariffs, Canada gives in etc.

Again, this is my ST view, which can change quickly with new information.

Cold CPI; some fuel to change sentiments. Added more $U @ $21.3 and $BLDR @ $132. Don’t let Trump on TV tonight please

Adding a long position on $INTC @ $22.61 in the overnight market. Prob gonna hold this position for the short-mid term.

Very bullish on Lip-bu Tan. There’s probably only a few people in the world that can turnaround INTC, and one of them is probably him. Got to read about him in his turnaround of Cadence Design Systems ($CDNS), and remember thinking to myself how lucky would I be if I could go back a decade to bet on him. Now there’s a chance, and some regulatory + political tailwinds. So r/r for a long seems right to me.

I view $INTC as a very binary bet. $INTC shouldn’t be priced based on its NTM or even next 2 years earnings, but on the success rate of a turnaround.

If LBT succeeds, and $INTC is able to win back share in CPU + gain competitiveness in GPU + develop a reputable foundry, $INTC is easily @ $40-$60. If he fails, $INTC prob hangs around $15-$20. Potential acquisition probably provides a safe floor, and even Pat’s aimless leadership + expulsion can’t get it below $20.

(Success % x midpoint price if success) + (failure % x midpoint price if fails) = $INTC current price.

15% x $50 + 85% x $17.5. We can argue about the price if success and price if failure, but this is how I’m thinking about it.

Based on this napkin maths, market probably pricing the news as a ~15% successful turnaround. Our job here is to decide whether the success rate is likely higher than 15% or not.

Given LBT’s wide industry connections (helps partnerships), reputation (helps morale), technical expertise and turnaround experience (helps investors’ sentiments), I think it’s worth a bet. I don’t think it will be easy, in fact I think there will be a lot of resistance both internally and externally, but I like the r/r.

Very speculative in nature of course (he hasn’t even taken over yet), but with these types of binary bets, I find that it’s better to build a position early (when market is already pricing in a 85% failure) and cut/add more if incremental info comes out to prove us wrong/right, than to enter only when information comes out to prove success > 50%.

Just my 2c on how I view such bets. And given LBT’s VC background, might be what he’s thinking too to risk his entire legacy on this high-profile turnaround at such an advanced age. (eg If he fails, it’s not him, it’s the company)