Portfolio Update

I ran the model this morning including the latest prices. Commodities are performing relatively stronger than equities, but both are fading, and I anticipate being out of them entirely within a month. Bonds have moved into a negative phase for the first time since February this year. The current allocation has 2/3 in commodities and 1/3 in equities. Here are the positions I took this morning:

  11% BAL
   6% DBC
   5% EPU
   5% EWO
  13% FUE
   6% JJT
   6% JJU
   6% KOL
   5% KWT
   4% PTM
  10% SLV
   9% UGA
   6% UHN
   7% XOP

The excitement of the next round of quantitative easing (QE2) has been priced in and then some, and now the snapback happens. I'm anticipating a roller coaster market in the two weeks around the election. There was a big rush into the markets starting in late August, just as forward economic data was beginning to show some softness, and talk of further asset purchases started to appear outside of academic circles. That rush has been spent and I think we're now at a Wile E. Coyote moment just off the tip of the precipice. To be honest, I'm not entirely comfortable being all long at this point, and I had considered retreating to a 50% cash position on today's trades. I think that is almost a certainty for next week, barring some major revelation from the Federal Reserve.

I haven't updated my tracking portfolio with the latest model output. However, as of 9 AM PDT this morning, it was up 3.68% over inception three weeks ago, versus 3.10% for the benchmark portfolio, that being an equal weighting of BND, DBC, and VEU, rebalanced monthly.