Private Trader - Defensive State: Increased
Educational only. This Market Log entry reflects the personal market views and interpretations of a private trader investing only their own capital. It is impersonal, does not consider your objectives, financial situation, or needs, and does not constitute financial advice, financial planning, portfolio management, or a recommendation or solicitation to buy or sell any security. All content is for educational and informational purposes only.
P26-01-19
Sup folks, let’s get straight into it!
We’re only a few weeks into January and positioning is already shifting; I’ve exited one of my largest holdings at profit, moving the portfolio to roughly 35% cash, and I expect that number to increase over the coming weeks. This wasn’t a decision driven by price yet by what sits underneath it; rates, liquidity conditions, equity risk premiums etc; when those inputs stop reinforcing each other, I move defensively and preserve capital first.
Within my framework, the position reached a saturation point where the probability of further upside weakened relative to the risk of a potential drawdown; I closed it after capturing both dividends and capital appreciation, which is why dividend-bearing equities remain a core part of how I operate across full market cycles, the more I experience, the more I continue to favor them.
That puts the year at +1.5% RCE (Realized Capital Efficiency) so far, with a working target of no less than +15% for 2026. Right now, the most important position I hold isn’t a ticker, it’s downright cash; with it, it provides optionality, how capital gets deployed with intent instead of urgency. I’m also consolidating toward a maximum of 10 positions that focus on fewer holdings, higher conviction, tighter risk control. I’ve also initiated 3 new positions that have lived on my watchlist for many years; they’ve entered valuation and risk zones my model considers actionable, and thus action was taken.
Is this timing the market? Yes. My objective isn’t constant participation; it’s selective exposure when probability, not conviction, is in my favor.
Current positioning:
20% U.S. Treasuries (expected to increase)
35% Cash (expected to increase)
45% Equities / ETFs (expected to decrease)
Enhance your framework continuously and stay disciplined; peace out for now!
Market Log entry · Private trader investing own capital only. Originally published on Madalytics before any external platforms.