As we closed out our first calendar month of performance, I wanted to review the returns and ask - was this all alpha, or was there some surfing involved?
The answer to which might lead us to react differently based upon our view that markets are ahead of themselves vis-a-vis central banks and are in for some turbulance.
So the headline - the names have worked (overall), the big marginal swing came from Tesla, which started the year in free-fall before recovering to add positive P&L.
FarFetch is the standout Long winner, pulling in a tremendous $800k in P&L (we've build the portfolio simulator assuming a $10mm initial investment and equal weight positions).
AbbVie is the leading short position, having generated $200k in P&L.
The long book is flying, but the shorts are hurting in aggregate. The big loser is Netflix, a short that has run up in early 2023, something our model does not predict will last, but right now the tech names are rallying hard.
Given the neutrality of the book (in dollar terms), and as we have not yet hit any price targets, we will leave the positions as they are, and see how earnings changes the picture.
We will look to make changes in the coming month as price targets are fully realised or exceeded and if losses become outsized versus the original hypthesis. However after only one month, we are more than happy with our +17%, dollar neutral return.
Good luck!
(the ideas in this sample portfolio have been generated using Upside's proprietary Analytics Engine, using insights derived from Superforecasting and Wisdom of the Crowd, the performance does not include trading, borrow or any custodial or real world implementation costs, it is hypothetical only and is fully automated. This is not financial advice or a recommendation)
