After last week’s FOMC statement, Dennis Gartman wrote that he had gone “from ‘agnostic’ to bearish of equities.”
At the time, he also wrote that he would “punt in the very short term on the short side of gold.”
Now, Gartman admits he was wrong:
“Trading, as they say, ain’t easy and like growing old, “It ain’t for sissies.” The trick… the “Secret”… the thing that separates those of us who’ve survived for decades in the business from those who light up the sky in a brief blaze and then blaze out like Icarus flying to close to the sun… is that those who survive do so because we know our limits; know our boundaries; we know when we are wrong and we admit it often and quickly. The “secret” is that there is no secret.
“Last week we tried to sell both the US equity market and gold and both proved almost comically wrong, with the decision by Mr. Draghi on Thursday turning our trades blithely and consequentially wrong within a day. But the losses were “livable,” and were kept to 1-2%. Those are manageable losses; those can be survived, and we did indeed survive, with only our reputation sullied a bit in the process. Such are the vagaries of trading, and such shall be the vagaries of trading in the days, weeks, months, years and hopefully decades ahead.
“Some have asked if we were embarrassed by the one unit short positions in gold and equities and do we wish we’d not done them? We shall answer in a most direct manner: “Nothing we did was embarrassing; they were simply wrong.” Our trades were well designed; the risks were well defined; the technical circumstances were well documented and historically valid… the trades simply went awry. We would not hesitate to do the same trades in the same manner under the same circumstances anytime again in the future; we would not hesitate for even a minute and we wish to be quite clear about that fact.”
It’s refreshing to hear people admit their mistakes. This is rare behaviour on Wall Street.
Gartman says he will try and keep such mistakes to a 1-3% level. We’ll be watching.
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