Flash Update – July 7, 2020

Published on: July 7th, 2020

Raoul adds some granularity to his dollar view and to his macro framework in order to clarify how he approaches
investing, and thus assist subscribers to understand and make the most of his research.

Comments

  • J
    JP .
    10 July 2020 @ 17:53
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  • RR
    Raj R.
    10 July 2020 @ 14:18
    The Euro-USD chart is showing the Euro bouncing off a long term trend line, which would mean dollar will continue to weaken unless the chart breaks the trendline? Is Raoul suggesting the trendline has to break for his thesis to be confirmed?
  • MP
    Matthew P.
    10 July 2020 @ 05:12
    Thanks Raoul - great piece. Also, to your last point - it would be great to learn your take on portfolio construction (for macro) and position sizing.
  • JS
    Jim S.
    10 July 2020 @ 02:58
    What are “singe trades”. Did you mean to write “single”. Oh, page 11 last 2 lines. Not looking for typos, just want to make sure I understand the “jargon” if singe is a term. Thanks!
  • RG
    Robert G.
    9 July 2020 @ 19:29
    good update. Thanks
  • MF
    Michael F.
    9 July 2020 @ 18:55
    Hi Raoul, I am looking for a place to get short copper, while also going longer gold. Hard to be early and fight momentum on the copper short, while also tough to pull the trigger adding to gold long. Do you see a better risk/reward to just put on both from here together or continue waiting? Thanks
  • KH
    Kavi H.
    9 July 2020 @ 08:55
    Hello Raoul, Thanks for the update. I just wanted to ask if you would put a stop on for the copper short or rather wait until a pullback to cover. Thanks Kavi
  • mh
    miles h.
    8 July 2020 @ 22:59
    So insightful, thank you.
  • AS
    Alan S.
    8 July 2020 @ 04:59
    Don't make it a tip sheet; then you are just one of many. Better to explain how to structure an investment and what products to utilize. Btw, screw the futures, regardless of this/that/the other, they're too difficult to access for too many. But as I have said to you before, who cares about the Canadians? Stay healthy, Alan
    • RE
      Raymond E.
      8 July 2020 @ 21:22
      Access to trading futures is available in Canada through several brokers, including Interactive Brokers. One would be well served to take time to educate oneself about futures before beginning to use them -- doing so is well worth it as they offer significant advantages.
  • RM
    Rohin M.
    8 July 2020 @ 16:26
    Raoul - the stop on the EURUSD position at around 114.50 - does that level stop out all your USD trades eg. vs GBP, AUD, JPY...etc? Thanks
  • GP
    Geoff P.
    8 July 2020 @ 13:42
    I applaud your resistance to indulge activity seekers. If you wouldn't mind sharing, I'd love to hear specifics about your sizing framework. Portfolio construction / sizing is quite rare these days.
  • WM
    Will M.
    8 July 2020 @ 13:41
    Very well written piece clearly outlining Raoul's approach. Yes those of us who are not professional traders want to believe that by purchasing RVT Pro, it will lead to one big winning trader after another. Unfortunately that is not the case, macro appears to be a journey and thinking is required.
  • CS
    C S.
    8 July 2020 @ 01:24
    Raoul, I think you should preface (at least your side) of the service up-front to potential subscribers, with what you have written above. You will of course include how Julians shorter time horizon compliments the service as a whole. Not that you've advertised it as anything but a pro-level service, caveats naturally follow. I have been a subscriber for 3 years I think now. Its a great service, a privilege to have access to. Having said that, I suppose my main frustration, and this could very well be just my own (differing horizons etc, all mentioned above) is how the framework and pay offs can straddle multiple subscription periods. Thats weighed against the cost of each subscription period, where pay offs can be lumpy. Its all an education. Cheers.
    • RP
      Raoul P. | Founder
      8 July 2020 @ 10:54
      Yeah, that's just how it goes as we only suggests the trades or investments when we think it makes sense and as we often say, macro is like waiting for a bus... you wait for ever and then 11 come along all at once!
  • JW
    J W.
    8 July 2020 @ 06:14
    Thanks, Raoul, for trying to clarify your general time horizon. I am still confused, however. It seems to me that you in your recent discussion with Ben Melkman (brilliant interview by the way) agreed with him that the USD will eventually break down (Because of endless stimulus and move away from reserve currency status). I believe you have stated something similar in one of your previous conversations with Julian. So, there is long-term (Dollar up) and longer term (Dollar down)? What is your current idea about the time frames (the discussion with Melkman seems to indicate we are talking about 1-2 years for the “longer” long term)? Do you really still believe the EURUSD may reach extreme values such as 0,8 given the strong and eventually (according to yourself) victorious forces pushing the Dollar down? Another issue: I sympathize with the view that you don’t want to provide a tips service. I would hate to have somebody yelling at me every afternoon to buy or sell (cf. Hedgeye). On the other hand, the current “advertisement” for your pro service contribution might run as follows. “In my pro service you will mostly find information about trades I have initiated a long time ago. Timing is not my thing, so you will not get any idea about when the investment will return a profit. I may talk about the importance of portfolio construction, but I will not provide you with info on how my trades are sized. In addition, I will already have told everyone and their mother about my views on twitter and RV essential”.
    • RP
      Raoul P. | Founder
      8 July 2020 @ 10:52
      Im sorry you feel that way but this is not a trading service it is a macro research service.
  • CP
    CRAIG P.
    8 July 2020 @ 05:40
    When you write “I will set up an AMA . . .”, do you mean an Ask Me Anything or Asset Management Agreement? Not familiar with that jargon.
    • RP
      Raoul P. | Founder
      8 July 2020 @ 10:51
      Ask me Anything
  • SS
    Shanthi S.
    8 July 2020 @ 09:37
    Another excellent piece. Thanks for all your deep work Raoul. Any advice on position sizing and portfolio construction would be hugely appreciated.
  • DF
    David F.
    8 July 2020 @ 07:55
    Great note Raoul - time and idea time horizons to match. Thanks
  • GD
    Gerrit D.
    8 July 2020 @ 06:37
    Great piece. Hope people will remember the difference between a "tip service" and a "macro framework" and the portfolio approach for a long time. It is annoying to see harsh comments from some RV subscribers if a single trade suggested by GMI is not working out well for them quickly.
  • MS
    Mark S.
    8 July 2020 @ 03:07
    Raoul, I'd really love to get a some examples of how to size a trade. I can't think of one RV video that covers this in depth. So first discuss what makes up a portfolio and how one should look at each category. Equities? Land? Diamonds? Precious Metals? Bonds? etc When I decide to invest, how much cash should i a lot to any of these? How should I think about the size of my initial position? All in? 25% of what I was going to commit to a particular asset and add on pullbacks 10% each time after that? 20%? I tend to trade options so I have to think with that factor on top of everything else. I think you could do a mini series on sizing positions.
  • RG
    Rob G.
    8 July 2020 @ 02:25
    Great piece - may I suggest that greater clarification is provided around 1) position sizing and 2) how you manage the risks on the individual legs of the overall portfolio. Re 1) what % of your account equity do you risk on each trade if your initial stop was hit, and do you scale into these positions or just pile it all on when the trade is published? What portfolio "heat" do yo max out at before you start trimming risk exposure? Re 2) You clearly provide stops for all your trade recommendations...great. But then you mention that it's the portfolio's performance as a whole (paraphrasing here) that you're concerned about, not just the individual trades and their respective individual performances. So what I would like to know is, is there ever a time when you ignore the stop on a specific trade, because you deem its inclusion in the portfolio as beneficial to the portfolio as a whole? If so, does this necessitate a stop on the entire portfolio's P&L, in the case where your thesis turns out to be wrong?
  • JC
    John C.
    8 July 2020 @ 00:24
    Great communication! Thanks Raoul.
  • JR
    Jason R.
    7 July 2020 @ 21:48
    Raoul, I appreciate the depth, candor and transparency of your view. It is obviously formed with a great deal of background and experience. What I'm really loving about Real Vision is the willingness to test and challenge your (and other's) assumptions and opinions by having on other really smart people that bring additional perspective. All this does is create greater and greater context and insight to answer the simple question, "What should I do?" That's up to each of us and is our respective individual responsibility. Keep it up! Thanks for helping us to be better informed so we can take our own decisions about our investment choices.
    • RP
      Raoul P. | Founder
      7 July 2020 @ 22:20
      Thanks. I often forget that everyone is at different speeds as I am so used to dealing with hedge funds etc with decades of experience.
    • JR
      Jason R.
      7 July 2020 @ 23:59
      Yes...I face the same in my business as well. However, my advice is to stick with what works. It won't be for everyone, which is fine. Those that merely want a trading portfolio that they implement or other simple, short-term perspective may be better suited for another resource (which there are a plethora of). Something deep was/is needed. Kudos.
  • JW
    Jim W.
    7 July 2020 @ 23:47
    Raoul, this is a great piece. I suppose I'm in the "other" camp, in that I don't want and would find it hard to use a daily or even weekly trading service. Your macro pieces have let me put on trades that I clearly understand the risk rewards (usually with options) at price points that I understand. My only real suggestions for improvement would tie into adding/entering into positions after the initial recommendation--I don't have a feel if, two weeks later, I should still be entering if it has moved somewhat in the predicted direction.
    • JW
      Jim W.
      7 July 2020 @ 23:47
      and sizing the trades vs rest of book. (I would have edited this in, but apparently I can't do that).
  • DB
    Dan B.
    7 July 2020 @ 23:36
    Thanks Raoul - plenty of great advice throughout this one
  • B
    Benjamin .
    7 July 2020 @ 23:07
    “the best traders and investors have trade time horizons that match their idea time horizon” Incalculable value in a single sentence. Thanks Raoul!
  • BR
    Brian R.
    7 July 2020 @ 22:39
    Raoul, all good here. I will admit that I am a relative novice but I am pleased that I make money. I use your service and a few others, just like you said with reference to you hiring people in the past with different methods - to get different points of view and time horizons. Your service and Real Vision altogether is very much appreciated. Please keep up the exceptional work.
  • MD
    Mike D.
    7 July 2020 @ 22:29
    @Raoul, thanks for the clear and carefully thought update. I get the sense from reading comment streams that a fair number of Pro members are also familiar with Hedgeye, and fail to grasp the dramatic difference in approach and time scale between the two. I also want to thank you again for your work. The March 6 trades, particularly with your clear guidance to lean in with force, have made a tremendous and much needed difference in my P.A. I, for one, am very pleased to have today's additional guidance not only on planning horizons, but also how you recommend reading the guidance v.a.v. sizing. Thank you!
  • JK
    John K.
    7 July 2020 @ 21:57
    Raoul, if we, for whatever reason, did not enter the Euro trade when you did, what would you recommend for someone who would prefer to take a position in that trade now, specifically, if one were to use options to position in that trade? As always, thank you, sir. Regards, John
    • RP
      Raoul P. | Founder
      7 July 2020 @ 22:20
      The problem of options is one of time horizon... you get to only get exposure over three months or whatever so its another risk the trade could go wrong. I'd like to see the trend develop first by adding short Euro and a stop above 1.145 with how much you are prepared to lose if it hits it. That will define the leverage you can take. Once the trade is working, you can layer in with options when you think there is a good inflection point that will accelerate the trend. Options are great for trade acceleration points.
  • CB
    Charles B.
    7 July 2020 @ 21:51
    Raoul, What is an AMA?
    • TB
      Thibault B.
      7 July 2020 @ 21:53
      Ask Me Anything
  • SC
    Salvatore C.
    7 July 2020 @ 21:45
    Excellent snapshot! Thanks for this.