LEISURE LETTER (08/04/2014)



  • Aug 5:
    • BEE 2Q 10am: , pw: 73605986
    • RHP 2Q 10am:
    • MGM 2Q 11am: , pw: 1985444
    • SGMS 2Q 430pm: , pw: SGMS
  • Aug 6:
    • HT 2Q 9 am:
  • Aug 7:
    • MPEL 2Q 8:30am: , pw: MPEL
  • Aug 8:
    • DRH 2Q 10am: , pw: 153358818
    • SHO 2Q 12n:


IKGH – VIP promoter Iao Kun Group reported Rolling Chip volume of US$1.6 billion, up 7% YoY.  July win rate was 2.32%. July 2013 hold rate was 3.0%.

Takeaway:  2nd straight month of VIP volume growth for IKGH.  Could VIP volumes in July not have declined as much as the Street expects?  We should receive the July Macau details tomorrow and we suspect that low hold played a role with VIP volumes performing better than VIP revenue.


27:HK – A group of workers in the casino and hotel operations of Galaxy Entertainment Group Ltd will protest tomorrow outside of the Galaxy Macau. The workers are petitioning the Hong Kong-listed company to increase salaries, introduce changes to pay policies, and provide staff with more annual leave days and better career prospects.

Takeaway: The natives are restless and no operator appears immune to the labor demonstrations.


CWN:AU – Crown Resorts Ltd buying the vacant former Frontier Casino site on the Las Vegas Strip. Crown said it had established a joint-venture resort company to develop the site with former Wynn Las Vegas president Andrew Pascal, with financial backing from U.S. private equity firm Oaktree Capital Management. The group hopes to begin construction of a hotel-casino project in 2015 with a targeted opening in 2018. Packard was reportedly the runner up bid for the Cosmopolitan of Las Vegas earlier this year. 

Takeaway: We doubt Crown paid El Ad Properties anything close to El Ad's $1.2 billion basis in the land.  Another private equity firm enters the gaming sector.


GENM:MK – While the company is currently under construction on the 538,000 sq. ft Resorts World Birmingham for £150 million, with a scheduled opening in spring 2015, it is also is rumored to be one of the shortlisted final bidders for the entire NEC (National Exhibition Center) Midlands venue. Resorts Word Birmingham will feature outlet shopping, an Asian-themed spa, a four star hotel, cinema and international casino

Takeaway: Genting building its global gaming empire.


MGM – Springfield representatives and casino officials confirmed Friday MGM Resorts closed escrow on the former Zanetti School and the historic Springfield State Armory building late on Thursday. The final purchase price was $3.2 million – or $1.6 million for each building. The purchases come as the project’s future remains uncertain. Voters in November will decide whether to repeal the state’s 2011 casino law. MGM also paid the city more than $160,000 to cover property taxes assessed from the time MGM was awarded the parcels and when it closed on them. The casino’s agreement with Springfield calls for more than $15 million in upfront and advance payments as well as more than $25 million in annual payments.

Takeaway: Setting the stage for the new development.


WYNN – Wynn has proposed using custom-made catamarans, each able to carry 49 passengers, to connect a $1.6 billion hotel and casino on the Mystic River in Everett to Long Wharf in downtown and the World Trade Center in the Seaport, an extensive new service to reduce car traffic to the proposed resort, according to documents filed for review under the Massachusetts Environmental Policy Act. As many as three boats would be in service at one time, running from 6 a.m. to 2 a.m., and leaving as frequently as 20 minutes apart. 

Takeaway: Wynn doing its best to reduce traffic and provide an alternate means of transportation to its proposed property.


IHG:LN(Financial Times) reports that Marcato has hired investment bank Houlihan Lokey to advise it on options regarding Mercato's stake in Intercontinental Hotels.

Takeaway: If at first you don't succeed ...hire a banker.  A tax inversion structure seems to be the latest proposal to US hotel companies.


CCL (Caribbean Journal)  – announced that it had signed a memorandum of understanding to develop a $70 million destination cruise project in Tortuga (Ile de la Tortue), an island off the northern coast of Haiti.

Takeaway:  Following NCL's Belize example? 


CCL (Cruise Critic) – Tropical Storm Bertha has affected itineraries on Carnival Breeze, Carnival Liberty, and Carnival Valor


RCL – TUI Cruises, a joint venture between TUI AG and Royal Caribbean Cruises, today ordered two more cruise ships for its Cruises unit to reflect high demand for cruise holidays in Germany and Europe. The new ships will be delivered in 2016 and 2017 and will take the fleet of TUI Cruises to six ships.  TUI Cruises currently operates 3 cruise ships, with a fourth being built.

Takeaway:  Supply is heating up for Europe.  


Crystals (Cruise Critic) – dropped 2015 Crystal Cruises has removed Israel port calls from Crystal Serenity's September 20, 2015 itinerary as a result of recent violent unrest.  Crystal joins at least two other lines that have canceled calls on Israel due to mounting tension. 

Takeaway:  More cruise lines dropping Israel calls due to unrest.




WYN – CFO Thomas G. Conforti sold 28,659 shares on Monday, July 28th at an average price of $78.25 and now owns 106,526 shares.


RCL – CEO Richard D. Fain sold 94,850 shares on Tuesday, July 29th at an average price of $62.38 and now owns 1,131,395 shares.


UnionPay Fines Merchants – China UnionPay has imposed fines of 100 million yuan (US$16.3 million) over the last four months on third-party payment firms for misusing merchant category codes, which is likely to have caused losses of hundreds of millions of yuan among credit card issuers this year. The merchant category code is the number that credit card issuers adopt to classify companies which have to pay fees upon use at point of sale (POS) and the fees vary based on the category or the industry they belong to. Third-party payment firms have been misusing business category codes–even using fake names for many companies to meet the category classification on the lower-fee-charged POS–in order to help the businesses accepting payments pay lower fees to credit card issuers.

Takeaway: The next iteration in the crackdown in the misuse of the UnionPay point of sale devices.


Chinese Tourists Avoiding Singapore (Bloomberg)  A strengthening Singapore $, rising labor costs and a 7% sales tax Chinese tourists don’t encounter in Hong Kong is hurting Singapore retail sales.  A reduction in Chinese visitors contributed to a sales slide of as much as 4% in Singapore’s annual shopping festival (Great Singapore Sale), according to the retailers’ association.

Takeaway:  The Great Singapore Sale of 2014 turned out not so great.  We remain concerned with the Singapore economy and its impact on the LVS and Genting Singapore casinos there.


Notable Property Transaction

Malaysian company KSG Enterprises Ltd acquired the SpringHill Suites New York for $82 million or approx. $474,000 per key.  The 19-story, 173-key hotel, located at 25 W. 37th St., was developed from the ground up by Hidrock and Robert Finvarb, opened last year, and immediately achieved 90% occupancy.

Takeaway: A very strong price per key for a midtown Manhattan limited service hotel.


China Services July PMI:  fell to 54.2 from 55 in June, a six-month low


Hedgeye remains negative on consumer spending and believes in more inflation.  Following  a great call on rising housing prices, the Hedgeye

Macro/Financials team is turning decidedly less positive. 

Takeaway:  We’ve found housing prices to be the single most significant factor in driving gaming revenues over the past 20 years in virtually all gaming markets across the US.


Takeaway: Systemic risk measures offer some solace, but we'll keep our heads down for now.


"Is FICC Fixable? A View From The Trading Desk"

Invitation to Conference Call Thursday


Please join us this Thursday, August 7th at 11 am EST for a call with the Head of Credit Trading at TCW to discuss bond trading trends.


Participant Dialing Instructions:

  • Toll Free Number:
  • Direct Dial Number:
  • Conference Code: 919219#

We are hosting a conference call Thursday, August 7th at 11 am EST with Jerry Cudzil, the Head of Credit Trading at TCW. This call aims to help us understand, from the view of a major buy-side trading desk, the trends in Fixed Income, Currency, and Commodity trading (FICC). Specifically, we'll be focusing on:

  1. Cyclical or Secular?: The buy-side's perspective on whether FICC weakness is secular or cyclical.
  2. Share Shifts: Market share shifts that are occurring amongst the broker-dealer community in various markets.
  3. The Fed: How a post-QE bond market may look and the risk/reward setup in fixed income currently.

This call will be helpful to investors in broker dealer stocks and volume-related market structure companies: GS, MS, JPM, BAC, C, PJC, RJF, CME, ICE, NDAQ



Jerry Cudzil's Bio:

Mr. Cudzil is head of U.S. Credit Trading at the Trust Company of the West (TCW), overseeing the U.S. Fixed Income group’s trading of corporate and high-yield securities and derivatives. Prior to joining TCW in 2012, Mr. Cudzil was a high yield bond trader for Morgan Stanley and Deutsche Bank, specializing in project finance, aviation, and energy securities. He was previously a portfolio manager for Dimaio Ahmad Capital, managing the multi-strategy credit fund and aviation fund and leading the firm’s risk management team. Mr. Cudzil began his career as a corporate bond trader for Prudential Securities and has also traded investment and high yield debt for Credit Suisse and Goldman Sachs. Mr. Cudzil earned a BA in Economics from the University of Pennsylvania.





Current Best Ideas:




Key Callouts:

Last week saw one of the sharpest corrections in US equities in a few years.


Our last three weekly risk monitor headlines have read:

"Battening Down the Hatches" - 7/28/14

"Moving to Higher Ground" - 7/21/14

"Portuguese Risk" - 7/14/14


US Financial Equities are strongly correlated to junk bond yields and junk has been moving for a while. High yield was up +41.5 bps last week, rising to 6.07%, from 5.66%. On the month, high yield is now +74 bps. 


Rather than point out the obvious, we'll try and point out something that could be helpful: while there is broad-based weakness across US Financials (all 27 reference entities we track were wider on the week), the systemic interbank risk measures were unimpressed. TED Spread rose 1 bp to 22 bps and Euribor-OIS rose 1 bps to 15 bps. In other words, systemic risk appears to be stable, for now.   

Bigger picture, our view has been and remains that ongoing 2H14 macro headwinds from falling rates and decelerating home prices will continue to put pressure on the Financials complex.


Financial Risk Monitor Summary

 • Short-term(WoW): Negative / 1 of 12 improved / 5 out of 12 worsened / 6 of 12 unchanged

 • Intermediate-term(WoW): Negative / 1 of 12 improved / 7 out of 12 worsened / 4 of 12 unchanged

 • Long-term(WoW): Negative / 2 of 12 improved / 3 out of 12 worsened / 7 of 12 unchanged




1. U.S. Financial CDS -  Swaps widened for all 27 out of 27 domestic financial institutions on the week. The average increase was 11 bps (roughly 12%). Meanwhile, the corresponding equity prices were down by an average of 4% on the week.  


Widened the least WoW: UNM, XL, AGO

Widened the most WoW: GNW, AXP, PRU

Widened the least/ tightened the most WoW: AGO, MBI, UNM

Widened the most MoM: GNW, MTG, C




2. European Financial CDS - Portugal and Russia saw their bank swaps widen sharply, again, on the week. Not suprisingly, Portugal's Banco Espirito Santo - after weeks of heavy negative news flow - received a bailout over the weekend from the Bank of Portugal. Depositors and senior creditors appear to be protected, but everything downstream in the capital structure looks to be a washout. Meanwhile, US sanctions continue to take a toll on Russian banks, as Sberbank swaps widened 69 bps w/w to 352 bps and are up 110 bps on the month. 




3. Asian Financial CDS - Indian bank swaps widened by an average of 15 bps on the week, while Chinese banks widened by an average of 7 bps. Japanese financials were wider, on average, by 1 bp.




4. Sovereign CDS – Sovereign swaps were wider in Portugal and Italy (+21 bps and +6 bps, respectively), but little changed elsewhere, and actually tightened 4 bps in Spain. The US and Germany were unchanged. 








5. High Yield (YTM) Monitor – High Yield rates rose 41.5 bps last week, ending the week at 6.07% versus 5.66% the prior week.




6. Leveraged Loan Index Monitor – The Leveraged Loan Index rose 8.0 points last week, ending at 1876.




7. TED Spread Monitor – The TED spread rose 1.0 basis points last week, ending the week at 21.6 bps this week versus last week’s print of 20.61 bps.




8. CRB Commodity Price Index – The CRB index fell -2.1%, ending the week at 292 versus 299 the prior week. As compared with the prior month, commodity prices have decreased -4.6% We generally regard changes in commodity prices on the margin as having meaningful consumption implications.




9. Euribor-OIS Spread – The Euribor-OIS spread (the difference between the euro interbank lending rate and overnight indexed swaps) measures bank counterparty risk in the Eurozone. The OIS is analogous to the effective Fed Funds rate in the United States.  Banks lending at the OIS do not swap principal, so counterparty risk in the OIS is minimal.  By contrast, the Euribor rate is the rate offered for unsecured interbank lending.  Thus, the spread between the two isolates counterparty risk. The Euribor-OIS spread widened by 1 bps to 15 bps.




10. Chinese Interbank Rate (Shifon Index) –  The Shifon Index fell 14 basis points last week, ending the week at 3.20% versus last week’s print of 3.34%. The Shifon Index measures banks’ overnight lending rates to one another, a gauge of systemic stress in the Chinese banking system.




11. Chinese Steel – Steel prices in China rose 0.2% last week, or 5 yuan/ton, to 3131 yuan/ton. We use Chinese steel rebar prices to gauge Chinese construction activity, and, by extension, the health of the Chinese economy.




12. 2-10 Spread – Last week the 2-10 spread widened to 202 bps, 4 bps wider than a week ago. We track the 2-10 spread as an indicator of bank margin pressure.




13. XLF Macro Quantitative Setup – Our Macro team’s quantitative setup in the XLF shows 3.1% upside to TRADE resistance and 0.3% downside to TRADE support.




Joshua Steiner, CFA


Jonathan Casteleyn, CFA, CMT


Just Charts – The Move Lower


The table below lists our current investment ideas as well as a list of potential ideas we are in the process of evaluating (watch list).  We intend to update this table regularly and will provide detail on any material changes.

Just Charts – The Move Lower - chart1



8/5/14 ADM Earnings Call 9am EST

8/5/14 IFF Earnings Call 10am EST

8/6/14 MDLZ Earnings Call 10am EST

8/6/14 TAP Earnings Call 11am EST

8/6/14 NUS Earnings Call 11am EST

8/7/14 THS Earnings Call 9am EST

8/7/14 LNCE Earnings Call 9am EST

8/7/14 MNST Earnings Call 5pm EST

8/8/14 POST Earnings Call 9am EST



Consumer Staples fell -2.9% week-over-week versus the broader market (S&P500) at -2.7%.  XLP is up 1.1% year-to-date versus the SPX at 4.2%. XLP is the third worst performing sector in the ytd, ahead of Industrials (XLI) -0.9% and Consumer Discretionary (XLY) -1.8%.


Positive Divergence:  SODA 9.2%; BG 8.6%; NWL 3.6%; REV 2.0%; ENR 1.1%

Negative Divergence:  HLF -20.4%; SAFM -9.7%; KRFT -6.1%; TSN -6.3%; BNNY -6.2%


From a quantitative set-up XLP is broken over the immediate term TRADE and intermediate term TREND durations.

Just Charts – The Move Lower - chart2


The Hedgeye U.S. Consumption Model shows 6 of the 12 U.S. Economic Indicators flashing green.

Just Charts – The Move Lower - z. consumptionpng


We continue to believe that the group is facing numerous headwinds, including:

  • U.S. consumption growth is slowing as inflation rises, in-line with the Macro team’s 1Q14 theme of #InflationAccelerating, Q2 2014 theme of #ConsumerSlowing, and Q3 2014 theme of #Q3 Slowing
  • The economies and currencies of the emerging market – once the sector’s greatest growth engine – remain weak with the prospect of higher inflation in 2014 eroding real growth
  • The sector is loaded with a premium valuation (P/E of 18.8x)
  • Less sector Yield Chasing as Fed continues its tapering program
  • The high frequency Bloomberg weekly U.S. Consumer Comfort Index (rescaled for cosmetic and not component reasons) has not seen any real improvement over the past 6 months, and fell to 36.3 versus 37.6 in the prior week

Just Charts – The Move Lower - chart4

Just Charts – The Move Lower - chart5

Just Charts – The Move Lower - chart6


In the charts below we look at the largest companies by market cap in the Consumer Staples space from a quantitative perspective.


BUD – bearish TREND = 110.43 resistance

Just Charts – The Move Lower - chart7


DEO – bearish TREND = 124.67 resistance

Just Charts – The Move Lower - chart8


KO – bearish TREND = 40.48 resistance

Just Charts – The Move Lower - 99


PEP –  bullish TREND = 87.24 support

Just Charts – The Move Lower - 10


GIS – bearish TREND = 52.19 resistance

Just Charts – The Move Lower - 11


MDLZ – bearish TREND = 36.99 resistance

Just Charts – The Move Lower - 12


KMB – bearish TREND = 109.73 resistance

Just Charts – The Move Lower - chart13


PG – bullish TREND = 79.22 support

Just Charts – The Move Lower - 14


MO – bearish TREND = 41.33 resistance

Just Charts – The Move Lower - 15


PM – bearish TREND = 84.22 resistance

Just Charts – The Move Lower - 16


Howard Penney

Managing Director


Matt Hedrick



Fred Masotta


real-time alerts

real edge in real-time

This indispensable trading tool is based on a risk management signaling process Hedgeye CEO Keith McCullough developed during his years as a hedge fund manager and continues to refine. Nearly every trading day, you’ll receive Keith’s latest signals - buy, sell, short or cover.

Monday Mashup: Full Slate of Earnings

Investment Ideas

The table below lists our Investment Ideas as well as our Watch List -- a list of potential ideas that we are in the process of evaluating.  We intend to update this table regularly and will provide detail on any material changes.

Monday Mashup: Full Slate of Earnings - chart1

Recent Notes

07/28/14 Monday Mashup: MCD, YUM and More

07/28/14 MCD: McLibel 2.0?

07/29/14 DRI: Light Gets In

07/31/14 YUM: Warning Shots Fired

Events This Week

Monday, August 4th

  • KONA earnings call 4:30pm EST
  • JMBA earnings call 5:00pm EST
  • TXRH earnings call 5:00pm EST

Tuesday, August 5th

  • TAST earnings call 8:30am EST
  • BLMN earnings call 9:00am EST
  • ARCO earnings call 10:00am EST
  • DAVE earnings call 4:30pm EST
  • FRGI earnings call 4:30pm EST
  • PBPB earnings call 5:00pm EST
  • CHUY earnings call 5:00pm EST

Wednesday, August 6th

  • PZZA earnings call 10:00am EST
  • THI earnings call 2:30pm EST
  • GMCR earnings call 5:00pm EST

Thursday, August 7th

  • WEN earnings call 9:00am EST
  • EAT earnings call 10:00am EST
  • JACK earnings call 11:30am EST
  • IRG earnings call 5:00pm EST

Friday, August 8th

  • MCD July sales and revenue release

Chart of the Day

Monday Mashup: Full Slate of Earnings - 2

Recent News Flow

Monday, July 28th

  • JMBA announced an expansive franchise recruiting campaign in key markets where they plan to accelerate growth, including Atlanta, Miami, Dallas and specific East Coast markets.
  • RRGB is celebrating its 500th new restaurant opening on Monday, August 4th when it opens in Milpitas, CA at the Great Mall of the Bay Area.
  • DRI completed its sale of Red Lobster to Golden Gate Capital.
  • PZZA announced it is celebrating the summer barbecue with its new Spicy Pulled Pork Pizza.
  • DAVE elected David Mastrocola as Chairman of the Board of Directors.  Mastrocola currently serves as Co-Founder and Advisory Chairman of Pleasant Lake Partners, LLC and previously served as a partner and Managing Director of Goldman Sachs.

Tuesday, July 29th

  • CAKE celebrated National Cheesecake Day by offering any slice for half price.

Wednesday, July 30th

  • No significant news.

Thursday, July 31st

  • BWLD was upgraded to buy at Sterne Agee with a $176 PT.
  • DRI announced a $500m accelerated buyback through Goldman Sachs and Wells Fargo.  A portion of the proceeds from the Red Lobster sale will be used to fund this.
  • BAGL announced a quarterly dividend of $0.13 per share.
  • WEN announced a quarterly cash dividend of $0.05 per share.

Friday, August 1st

  • PZZA increased its quarterly dividend to $0.14, up from $0.125.
  • CAKE opened a Cheesecake Factory restaurant in Reno, NV.
  • BOBE management and the board refuted Sandell's proposals in a recent company presentation, calling the activist's suggestions "shortsighted."

Sector Performance

The XLY (-1.8%) outperformed the SPX (-2.7%).  On average, casual dining stocks (-2.9%) underperformed and quick service stocks (-1.7%) outperformed the XLY Index.

Monday Mashup: Full Slate of Earnings - chart3

Monday Mashup: Full Slate of Earnings - chart4

XLY Quantitative Setup

From a quantitative perspective, the sector turned bearish on an intermediate-term TREND duration.

Monday Mashup: Full Slate of Earnings - chart5

Casual Dining Restaurants

Monday Mashup: Full Slate of Earnings - chart6

Monday Mashup: Full Slate of Earnings - chart7

Quick Service Restaurants

Monday Mashup: Full Slate of Earnings - chart8

Monday Mashup: Full Slate of Earnings - chart9


Howard Penney

Managing Director


Fred Masotta


Self-Confirming Info

This note was originally published at 8am on July 21, 2014 for Hedgeye subscribers.

“Because we naturally seek self-confirming information, we need discipline to consider the opposite.”

-Chip Heath


That quote comes from a block and tackle #behavioral chapter in Decisive titled Consider The Opposite (pg 114). If I was ever seeking self-confirming evidence of US GDP #GrowthSlowing, this morning I’ve got plenty of headlines on that.


The cover of this week’s The Economist has a picture of an American jockey riding a turtle with a header that reads: “America’s Lost Oomph – Why It’s Long-Term Growth Rate Has Slowed.” And on Friday, the WSJ ran a story titled “Survey Shows Economists Trimming Growth Forecasts.”

Self-Confirming Info - cart

#Trimming? With both bond yields and the Russell 2000 US growth index falling back toward their YTD lows, isn’t the market telling us to go all-in US growth investing? No thanks. The only discipline that matters in considering the opposite of our research view is delivered to us daily via real-time market signals.


Back to the Global Macro Grind


The best part about The Economist and Wall Street Journal articles is that they attempt to explain US #GrowthSlowing with the wrong reasons. The Economist, in its classic Keynesian style, suggests that the Fed keeping rates at 0% remains critical to growth and that the government needs to both spend more and expand immigration. #MustPrintAndSpendMoarrr


My colleague Darius Dale comically summarized the WSJ article this way on Friday: “Net Exports are a solid negative ~2% of US GDP… not sure how “negative international events” can ever be the largest downside risk to US GDP growth. Consensus Macro can’t even get their story straight at this point.” #BlameTheWeather


In other words, those who were looking for +3-4% 1990s style US GDP growth 6 months ago should cite anything but what’s slowing 70% of the number (US Consumption = 70% of GDP). And, whatever they do, they shouldn’t blame The Policy To Inflate’s impact on real cost of living in America either.


In other self-confirming USA #Q3Slowing news, here’s what big macro markets signaled last week:


  1. Russell 2000 lost another -0.7% on the week, falling back to -1.0% for 2014 YTD
  2. US 10yr Treasury Yield dropped another -4bps on the week, and is down -55bps YTD
  3. Yield Spread (10yr minus 2yr) compressed another -7bps on the week to fresh YTD lows


Don’t kid yourself, the economists who are now cutting their GDP forecasts know exactly what falling bond yields and a compressing yield spread means. On the other side of that, this is what consumption growth bulls are saying:


  1. Food prices dropped -0.1% last week
  2. Natural Gas dropped -4.7% last week
  3. Gold dropped -2.1% last week


Too bad you can’t eat Gold. If you contextualize those three data points however:


  1. Food Prices (CRB Food Index) is still up +19.1% YTD
  2. Natural Gas has round tripped back to flat YTD
  3. Gold made another higher-low and is up again this morning to +9.3% YTD


So, from an asset allocation perspective, what would you rather be long YTD – Gold or the Russell? That one is too easy to answer. How about The Dow, Coffee, or Cattle?


  1. Dow Jones was +0.9% last week to +3.2% YTD
  2. Live Cattle prices were up +1.8% last week to +17.7% YTD
  3. Coffee prices were up another +6.8% last week to +47.2% YTD


I know. Instead of citing the all-time high in both US rents (34% of the country rents) and meat prices during BBQ season, let’s talk about the corn chart rolling over from its all-time bubble highs as a “deflationary force” when the Food Index is +19% YTD.


As for the SP500, which hasn’t been as much a focus for us in 2014 as the #GrowthSlowing style factors within the market, there are plenty of components that we like on the #InflationAccelerating (Energy, XLE +11.8% YTD) and slow-growth #YieldChasing (Utilities, XLU +12.6% YTD) front.


I even went smart beta last week and sent out the buyback signal on AAPL during its correction to what we call immediate-term TRADE oversold (within a bullish intermediate-term TREND). While I can’t feed my kids iPads, apples are eatable – and, compared to a $12 “gourmet burger”, relatively “cheap” too!


Our immediate-term Global Macro Risk Ranges are now:


UST 10yr Yield 2.46-2.54%

SPX 1959-1985

RUT 1133-1155

VIX 10.32-13.70

WTI Oil 100.50-103.41

Gold 1308-1345


Best of luck out there this week,



Keith R. McCullough
Chief Executive Officer


Self-Confirming Info - Chart of the Day

Chart of the Day: Fade Buy-Side Consensus

Chart of the Day: Fade Buy-Side Consensus - Chart of the Day

This chart shows that consensus is now net short the SPY. 

investing ideas

Risk Managed Long Term Investing for Pros

Hedgeye CEO Keith McCullough handpicks the “best of the best” long and short ideas delivered to him by our team of over 30 research analysts across myriad sectors.