Anyone in Citadel?

Well, guess if you are rich enough to have an investment portfolio held with Citadel, chances are you wouldn't be the type trading the market yourself and hence, reading our journal.    Good thing, for us that is!  There was news that one of the most successful hedge fund, run by Kenny Griffin, is currently down 47% YTD, and 13% in November alone.     This is just freakishly amazing.    Sure,  it's much tougher to run a multi billion dollar fund than a million dollar portfolio.     But come on,  if your $20 billion+ portfolio was cut in half in one year,  what the heck is the point of even being in existence?

Okay,  it's a little harsh on Citadel, but this is actually a general point we are tying to make here.   In fact, the entire hedge fund industry is going through some tremendous pain during the last little while.    We have some sources with our local Toronto hedge fund boys and according to our inside source, the best funds is down about 60%.    Granted, alot of funds here, north of the border that is, are heavy on commodity stuff but it is incredible stuff when you think how these "professionals" suppose to know better.    What happened to the hedging part in a hedgfund?  So, if you are bummed out from a small or break even performance the past while, don't be.   On the contrary, pad yourself on the back on the job well done to preserve your precious capital.

Today's action was a little predictable ahead of tomorrow's job report.   Nobody wants to be caught with too many long positions with potentially a nasty job report on the horizon.  Thus, an end day retreat for the market, before thankfully a late attempt to get back to 850 SPX that just failed to hit the mark.  Some are calling for a 400-500k number tomorrow.   Still, we are reserving our opinion on the expectation of street reaction,  it's really anyone's guess.    However, we think a bad report will paint a very gloomy trading environment going forward as reality will sink in.  It seems it must week after week.   By the way, did anyone see the collapse in oil/gas price today?    Ok, it isn't anything new, but the fact there's no support whatsoever in the crude at this point on a technical basis it seems.   We think it is more of a supply issue now.   No Opec country or big oil producer are willing to cut the production.   Basically, once you have turned on the hose (money flowing), it's hard to turn it off.

Our choice of plays have becoming very narrow and limited these days.   Most of the EPS plays have pretty much lost their lust and a new eps season is still sometimes away.     The biggest thing on the agenda is still the automakers' bailout deal.     Believe it or not, we feel that we will only see a "true" bottom if GM fails.   Why we think that?    Because if the big three fail,  we'll most likely have a pretty good view of how this market reacts.    Yes, it's gonna be bad for economy, for employment, politics and everyone.    It will be a true test to see how this market responds to what we think is the ultimate doomsday scenario for this year.     It just can't get any worse.

Ok, fingers are crossed for the job report tomorrow.   More importantly, the type of report will give us a clearer picture of trading in the last three week of the year.