The Reason For The Sell Off

  • Maybe it was the forever low reading of the equity put to call ratio that finally caught up to the market–doubt it, that indicator as been almost useless for a while.
  • Maybe it was the fact that after a straight line 12% move the $RUT could not break it’s March high so it had to sell off–no, I don’t think so.
  • Maybe its the Portugal thing, but we had heavy selling 2 days ago…probably not.
  • Maybe its because the market goes up and down not up or down and pull-backs are natural, they are suppose to happen, and they are not bad.
  • Maybe its because the market got a little over heated last week, and some stocks were making ridiculous moves, the type of moves that almost always leads to a small pullback just to keep everyone honest and to remind you that you are not that smart.

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What ever the reason may be, you need to realize and ACCEPT that the market will pullback, you will suffer draw-downs from time to time, how you somewhat prevent them in the future, react to them, bounce back from them, etc…is the key.  But this is all part of the game.  You can’t be a baseball player without at one point getting hit by a pitch or striking out, you can’t be a basketball player without spraining an ankle or jamming a finger, it comes with the territory.

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Frank Zorrilla is the founder of Zor Capital LLC a New York based investment management firm.  Our goal is superior performance, with preservation of capital as our number one priority. Zor Capital manages separate accounts (both taxable and retirement) for accredited investors and institutions. This structure gives clients access to a hedge fund like strategy while maintaining 100% control of their accounts.  Managed Assets

 


The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.


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