As I write I have the most cautious PA positioning I've ever had in my investment career at 85% gross long, 45% gross short and 60% cash.

My trading activity increased dramatically in Q2 as I've been continuously executing small trims to my longs as this market melts up and broadening out my short book. I now have a personal record 25 shorts on. I've also hedged my long portfolio with put options which unfortunately don't reflect on Commonstock.

I wrote on May 7 that I'm fully in on the TGA refill -> lack of liquidity thesis. Since then, markets have ripped, but the time is here as the Treasury began issuing new bills and rebuilding the TGA in earnest on 6/14 and 6/15. I think the risk/reward is heavily skewed to the downside over the next 4 months and my positioning reflects that view, while also allowing for upside participation if I'm wrong.

While in one corner of the market AI stocks are going parabolic, I'm still finding attractively priced stocks in other places. I think the current environment is one of the most favorable set-ups for long/short I can remember, although that might be expected coming off a very challenging 6 months for the strategy.

If I'm wrong, my hedges will expire and I'll get naturally more long. If I'm right, I'll be looking to get back to 100% net long exposure. Regardless of what happens in Q3 and through the rest of 2023, I think the chances the indices are materially higher 2-3 years from now are pretty good.

YTD:

Q2:

Week of 6/12: