Monday was a dismal day on Wall Street as investors prepared for the worst and ran far from equity markets after the release of S&P’s downgrade of U.S. credit quality to AA+ from its coveted AAA rating. Panic-selling caught on like wildfire and domestic equity indexes slid by as much as 6% on Monday alone, only to fluctuate wildly on Tuesday, and then slump again on Wednesday. Crude oil also fell victim to the violent sell-offs this week and futures contracts dipped as low as $75.71 a barrel on Tuesday, managing to work their way higher above the $80 mark by the end of Wednesday. On the other hand, gold investors couldn’t be happier that pessimism seems to be spewing from every corner of the market, as the precious metal continued its upward trek this week, hitting a new record high of $1,817 an ounce after the closing bell on Wednesday.
This week’s recommendations have posted mixed performance results so far given the rampant sell-offs and general feelings of uncertainty dragging down markets:
Checking In: Trading Ideas
This week, our trading ideas included a long positions in both a commodity and currency ETF, as well as a short position in an emerging market equity fund. Wild volatility continues to dominate global financial markets and likewise our picks have performed a bit under expectations, while still managing to turn out solid results when compared to the broad performance of equity markets as a whole.
Trading Idea #1: Long FXC
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