Red Lion

pupil are you looking at any short term corporate paper? I'm not sure I'm ready to go for duration exposure yet (other than continuing to buy equities on the way down), but interested in ways to get a bit more yield on short duration. Right now 4.5% 6 months T-bills looks pretty sweet on a risk:reward basis to me.

I sold a lot of puts for January 20, 23 (91 days) and then bought T-bills maturing January 31 at 3.99 YTM with the options premia. Sold the following strikes in varying degrees. BX 72.50 for $3.55 OWL $7.50 for $0.42 CG $23 for $1.25 GOOGL $90 for $3.80 I am leaving a lot of money in short term T-bills in anticipation of a large real estate investment, but I figured I might as well generate some returns writing cash secured puts on names I want to own at attractive prices. Other than GOOGL, all of these should yield 5%+ with good growth over the medium to long term.

Rolled my MED and SUI puts to 105 and 110 strikes expiring 11/18 for a smallish net credit.

I have not been a long time stockholder of Fairfax, but I recently started a position and am looking to increase this significantly. I believe this is one of the most compelling interest rate plays right now, and it seems to have a higher positive gearing to rising interest rates than BRK due to higher amount of cash to market cap and trading at a discount to book value. I think this write up is great, but what's interesting is that he uses a 3% yield on fixed income as sort of a base case and then as his bullish case he uses a 4% yield on fixed income. As of right now anything between 6 months and 5 years is at 4.5% or higher and the fed Is still hiking. So the setup definitely looks good, the valuation is still down, seems like there's a potential catalyst in place with stock buybacks below book value and a bond portfolio that starts gushing cash. Even at 4.5% a 35 billion bond portfolio is going to put out $1.5 billion in interest income on a $10 billion market cap, and who knows how much further the fed keeps hiking.

$80 10/28 BX puts

$115 10/21 MED put

Bought debit put spreads on QQQ today expiring 11/7/22, I'm long the $265 put and short the $255 put. My cost basis is $2.51, so the max profit here would be 300% return if QQQ drops 6% from today's price.

Sold my put spreads expiring on 10/24. I owned QQQ 270 puts and was short the 260 puts. I sold this put spread for a 50% profit even though QQQ is around 271 today and this expires in a week. I am going to look for a better hedge to put on with a bit more duration, preferably until mid November or so.

Not all bonds are created equal. Short term t-bills had a decent track record in the 70s compared to equities and longer term bonds, and they've certainly been one of the best places to hide so far this year. Personally, I don't have much need in my life or my portfolio for long term bonds. I have a very small position in 22 year TIPS, but that's it. Now that bonds are more attractive, stocks are also much more attractive. e.g., why not buy GOOGL with a 5-6% earnings yield, net cash balance sheet, and long term growth prospects? should still blow any long term bonds out of the water I would think.

I've been watching this since 2019 and kicking myself that I haven't bought in. Thank you for reminding me, I think I'm going to take another look on this. It seems like its a multi level marketing weight loss product type business the last I remember, is this correct?

1. Skiing 2. Fishing 3. Traveling Of course spending time with the kids and family doing all of the above.

Opened a position (again) in BUR. I have been watching this company for years, and it's always fascinated me. I do have some understanding of the business model and have run across litigation financing in my business. I've never held a long term position in BUR, but I'm planning to start. I've previously traded BUR twice, made a fast 50% profit right after the Muddy Waters report buying on the forced selling, and then had a wash last year. I sold my shares at the beginning of the market malaise this year for $9.25. Opened a new position about twice the size of the previous one at $7.67 today. Now if only I had left that money in cash instead of reinvesting it in KKR/APO at significantly higher prices...

I bought back some CG, BAM, and AMT puts at a significant profit that I sold last week. My only short put outstanding right now is on SUI.

Do you ever sell stocks to raise capital? Otherwise just live on the dividends?

I remember those days, and I remember seeing huge forced selling as people were liquidated from their positions with margin calls. I haven't begun to see the forced selling yet this time around, at least not nearly to the same degree. I have forced myself to allocate a significant amount of dry powder over the last 30 days because I want to be disciplined about buying on the way down, but I wouldn't be surprised if there's quite a bit further (percentage wise) until the bottom.

$120 10/21 SUI puts. $35 11/18 BAM puts $175 10/21 AMT puts

Can you give any insight about UK housing as a long term investment? Are you invested in rental property or an actual development from the ground up? I've been looking for a real estate investment and have been looking for something close to home that pencils out and have a chunk of US dollars earmarked for that purpose. It's occurred to me that maybe I should be trying to buy an investment property in Canada or the UK right now to capitalize on the strong US dollar since a 3 CAP rate rental property/part time job to manage it just doesn't seem that attractive right now.

If I understand you correctly, I think so. I think these remain attractive investments especially at these prices notwithstanding the cyclical element of earnings/carry, based on the FRE itself provided that they can continue to grow AUM. Right now a lot of the alts, at least the ones I'm invested in (BAM, APO, KKR, BX, and a smidge of ARES), have a pretty diverse set of businesses to raise AUM, so hopefully they will be able to continue increasing AUM even if the traditional PE funds come in quite a bit lower than the last peak cycle. So we have a lot of tailwinds for the AUM from pension risk transfer, annuities, retail, opportunistic credit, and maybe private credit I'm not sure. I think the significantly higher interest rate environment is obviously a significant headwind to the traditional PE business itself and maybe real estate/infrastructure private equity at least in terms of fundraising from traditional pensions. Obviously I think time will prove out one way or the other, but my thesis is that these companies on average, should continue to drive AUM growth which should then feed into a long runway of double digit FRE growth and growing cash distributions. I could always be wrong here though, and I certainly think rising interest rates are the #1 risk to the thesis. So I'm trying to cap my total investment in the alts at 25% of my liquid net worth, and I'm a bit under 20% right now. Also looking at keeping a large position in short term t bills and trying to allocate into other investments which can benefit/survive significantly higher rates. I've been following the alts since they started going public, and I feel like they always sell off SUPER hard in every downturn, but they have a resilient business model. All of them are great success stories over the last several decades, while most of that history was not publicly traded. I suspect they will provide very nice double digit returns from these prices, but I would expect them to continue selling off harder than the rest of the market. Historically, buying these companies when they're down 30-50% has made a lot of money, but I feel like you have to embrace drawdowns with these investments.

Started a new position in Fairfax today at $458.

Big slug of T- bills maturing 10/31.

Sounds like we pretty well agree on this one, and I know we have similar views on APO and KKR as well and some of the other alts. I've been taking more of the shotgun approach lately with this selloff, trying to diversify between different managers and avoid paying crazy multiples. At this point even the top players are reasonably valued IMHO. If rates keep going a whole lot higher than 4.5%, I think this could get really ugly for all the alts, as if it doesn't feel ugly enough already. This is why I'm hoping to beef up on some positions that I consider to be more resilient to higher interest rates (like BRK.B/GOOGL and maybe even FFH).

Fingers crossed. I'm hoping to build up both positions, and figure I might as well use these weekly puts to try to optimize my entry point and cost basis. Today I decided to do a little bottom fishing, and sold some $25 CG puts expiring next Friday. I think CG is one of the lowest quality ALTs, but it also has the most room for margin improvement, trades at a low valuation, and has a nice yield at $25. Figure it wouldn't hurt to round out my recent ARES/BX purchases.

New starter position in CLPR at $6.66.

Opened a starter position in ALCO with fills from $28.06-$28.20 (I started buying this in the after hours on Friday with a partial fill). Thanks @Gregmal for putting me on to this one.

Sold puts expiring next Friday on GOOGL and BRK.B.