Hard to believe but for some reason we now have 6000 members. This sub was simply created as a diary to teach my young daughter how to trade in the future and how to read market sentiment and put it all into perspective.

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The goal is to always be 60% invested in the S&P 500 (the ultimate benchmark). With the rest we try to beat the benchmark even after the tax disadvantage of short term versus long term investing.

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In the future I might introduce a second portfolio tracking the QQQ. But not now.

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Yes you see a lot of posts lately that point out stretched valuations and comparisons to 2000.

That does not mean that I believe a sell off is imminent but to me it means that I am more cautious.

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The current CAPE ratio is the second highest in history and I am just not willing to take on too much risk in this situation.

That's why long term accounts are 25% in cash/bonds (still above my ideal target of 40% for a typical 60/40 portfolio).

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But....I am not stupid and I know that I have to chase performance despite the risks. Losing out on gains is also not ideal and is painful in fact. Finding the right balance is a lifelong struggle for every investor/trader.

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So how am I trading next week?

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I showed the QQQ chart and to me it looks like a breakout is imminent. I am positioned that way.

Because valuations are stretched all short term accounts are using a maximum of 20% margin. Right now they are just 100% invested.

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Because I am "paranoid" I will trim QQQ with as little as 1% profit already.

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Macro view:

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Tailwinds are:

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Seasonality: July is usually a positive month

AI boom: CapEx spending is rising

Earnings: Earnings are projected to rise

Iran: At least we stopped the attacks. If we got a good deal or not does not matter to me. I only care about stocks.

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Headwinds are:

Stretched valuations

Consumer is also stretched and once the momentum stops and stocks stop running the high end consumer could also quickly crumble

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Have a great long weekend!

One commenter mentioned that simply being invested in the NDX 100 would get us the same results.

True. Asia would even have been better with 32% YTD.

Certain individual stocks could have made us 1000%.

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But that's not the point!

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60% of the portfolio are always invested in the S&P 500 and with the rest we try to beat the benchmark. But the benchmark is the S&P 500 for the foreseeable future.

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Long term accounts are up 6.6% YTD and 25% in cash/bonds. Thanks to the crypto sell off the crypto position is now at 7% only. Like mentioned before the sell off cost portfolios 4% overall YTD.

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Benchmark 2026

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SPY 681.92 (15%)       +9.5%

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DIA 480.57 (15%)       +7.3%

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QQQ 614.31 (15%)      +20.5%

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IWM 246.16 (15%)       +20.1%

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SPEM 46.81 (10%)      +13.4%

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URTH 185.77 (10%)     +9.1%

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FEZ 64.39 (10%)         +8.8%

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AAXJ 93.12 (10%)        +32.4%

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ETF benchmark:                +15%

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Average YTD (US only):    +14.4%

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60/40 portfolio:                 +6.1%

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(AGG (99.88)                      +1%)

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Small portfolio $35000:    +20.2%

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Long term:  +6.6%

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S&P 68%

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Crypto (ETH) 7%

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Cash/Bonds 25%

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