Markets in ‘Turmoil’ are Opportunities…and Writing Works

Writing works. It keeps me organized. As an investor, I did not really start consistent progress until I started the blog in 2005. I am not as consistent the last year on the blog but it comes in handy when I need to organize my thoughts and focus on a trade or investment.

My passion for publishing was the reason I started Stocktwits. It was inspired by Twitter as the lightest way I could think of to journal about stocks and markets.

It really helped me last weekend as the panic was setting into US markets. I really did grimace when I saw on the stream that CNBC was doing a special on ‘markets in turmoil’ but it is what they do. Like scorpions sting…financial media sells fear.

Few people ever predict ‘markets in turmoil’. Those that do, make a fortune and generally disappear. The best in the business wait for ‘markets in turmoil’ and make their move.

Over the years even I have learned that ‘markets in turmoil’ are an opportunity. Take a look at this chart and remember it:

$VIX PeaksOct 97: 48.6Oct 98: 49.5Sep 01: 49.3Jul 02: 48.5Oct 08: 89.5May 10: 48.2Aug 11: 48Aug 15: 53.3

— Charlie Bilello, CMT (@MktOutperform) Aug. 26 at 03:30 PM

This week was no different. I can’t believe it is already Thursday night. Selling into fear felt great Monday AM I am sure but today the S&P closed up on the week! If you sold, it’s not something to be ashamed about, but you should understand why you did it. Do you watch too much financial TV? Are you following the wrong people? Were you over invested coming into August?

I am glad I took the time to get my plan on paper. Based on the feedback this week, it did not just help me.

I think the markets will be different coming out of this correction. I am now turning my attention to the possibility of new leadership. It’s too early to tell and I need a break from the markets.

I only messed up in $XIV which I pared my losses in today. In hindsight, I burned myself on this security because I had been so successful using it as a tool to trade fear the last few years. I was lazy and did not trade the fear using options but through an ETF. It’s not so much the loss on the stock as it is being right on the markets move and still getting it wrong because of the weapon. The learning never stops.

Hopefully the market owes me next time I am wrong and by mistake I make money…but I doubt it.



  1. pointsnfigures says:

    watched a little bit of CNBC today between 1130-1230. not one piece of actionable information. all drivel. some of the stupidest questions I have heard.

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