Trades

I did three trades today, as the market seems to be bottoming and I wanted to reduce my short exposure. My feeling is that either it heads back up to 9000 or it breaks below 7500. Here are my trades:

1. Closed QQQQ @ $29.15 for less than 1% gain. Why? QQQQ has a PE that's been beaten down to 13x, and most of the earnings were good so far this quarter. Also, these companies have tons of cash on the books. They can't go much lower unless there's another round of panic and deleveraging.

2. Closed ITB @ $9.28 for a 17% gain. The Homebuilders index is trading at about 0.9X book value. It may go lower, but I'm keeping my short on KBH, which I believe is in worse shape than the index as a whole.

3. Closed EWW @ $28.34 for -7% return. I'm going to take a loss on this to reduce my exposure on international/emerging markets. Since Mexico hedged its oil revenue for 2009 @ $85/barrel, that kind of puts a floor under their economy through the first half of this year.