ManyPeaks.com

While mildly bearish in my market outlook, I haven’t shared any anecdotal signs of a top recently. They keep coming:

• Biggest LBO ever was announced last week when Blackstone took out EOP, the world’s largest REIT. Rival REIT Vornado was unwilling to bid as high, saying that doing so would hurt their shareholders. Blackstone is a bunch of smart guys, and EOP has some awesome asset, but when price becomes a non-issue, you’ve got a frothy market on your hands — usually a better sell than a buy. We are trading the IYR on the short side after a potential blowoff top.
• Last week’s IPO of hedge fund manager Fortress Investment Group was insane. FIG trades at 40x Earnings with a market cap of $7.5 billion. They manage $30 billion. I can promise you that for a price of 1/4 of the assets under management, Teewinot is absolutely up for sale. Roger does a good job dissecting the situation, and I’ll be back to discuss the unique aspects of this IPO later in the week.
• Wall Street must be really starved for good long ideas… even parking lot stocks are breaking out ! The Central Parking (CPC) weekly chart:
• Headlines declaring that “Day Trading is Making a Comeback” are making the rounds these days.. these news items typically appear around market tops, not bottoms.

For now though, the trend is still technically up. ManyPeaks accounts are not going wild on the short side by any means — We are 78% invested, 32% long — hedging primarily with a ProShares UltraShort Nasdaq 100 (QID) position.  It correlates to double the inverse of the QQQQ’s.
Long QID, Sell orders pending in IYR