Obama Wins Election, But Market Falls

The good news is the elections are now over with Obama winning. Frankly, we are just glad the negative political advertising is finished and that we can now move past the political uncertainty. Nonetheless, the market tumbled today 5.3%, giving back all of the gains from the prior day and then some. We are not particularly surprised at the fall today in part because of the large advance on Monday. The economic news that was released today was not good as employment continues to deteriorate and activity in the services sector clearly shows contraction. Frankly, this is no surprise, the economy is not doing well and in our view, will continue to struggle for some time. However, we still think the stock market is at attractive levels, although it could easily see saw back in forth over the short term. The volatility is still too high. However, we still think the market is trading in a very attractive range. We have put a limit order on the Dec 09 Call Option on SPY which we hope we can pick up at a good price. We have low balled the limit order at 10, so the option will need a significant drop for us to get in, but with the current market volatility that could easily happen. We want to get in at the right price, so if doesn't happen, that's okay!