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You hear the term “pain trade” thrown around the financial media sometimes. Here’s the Cliff’s Notes definition: It’s the trade that delivers the most pain to the most investors.
As the market rallies nearly 3%, it’s time for us to reckon with our pain trade. What’s going to cause the greatest amount of pain to your portfolio? Do you have an idea of market direction or a theme that would hurt your positions the most?
See, it’s not hard to imagine quite a few folks out there who were overweight in bearish positions – a lot of bearish exposure – which is understandable given where the market was just 40 hours ago.
But that was then, this is now.
If today’s big move higher is upsetting your P/L, are you ready to reverse course and join the very crowded bullish trade today?
It’s a much trickier question than headlines might suggest. I’m watching some things in the volatility markets that’ll help your decision and give the clarity you need…
