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Saturday, October 4, 2025
[YOLO Update] (No Longer) Going All In On Steel (+🏴☠️) Update #88. Government Shutdown Edition.
General Update
The last update was only seven days ago and the healthcare insurance positions I closed in that updated would have been highly profitable. I did end up still making some money via selling my bonds for a profit and adding a large $CNC position (though my healthcare position was smaller than before) based on ACA tax credit comments (source). I'll go over those trades and how the shutdown situation has evolved.
As has been the recent trend, this will be more brief than some of my previous updated. For the usual disclaimer up front, the following is not financial advice and I could be wrong about anything in this post. This is just my thought process for how I am playing my personal investment portfolio.
Shutdown Developments
For an overview how the shutdown has kind of gone:
- There were talks among some Republican and Democrat members that sounded hopeful (source1, source2). That led me to feel a deal was likely but those talks appear to have mostly broken down since then.
- What has happened since then is that Republicans have chosen the stick (𓆱) and not the carrot (🥕). The have canceled the House votes for next week (source). Trump is withholding funding from blue states (source1, source2). Trump has claimed he will soon be firing government employees that work on Democrat priorities (source).
- Basically they are signaling there won't be a deal and they will just inflict ever increasing pain the longer this shutdown goes on instead.
- Thus it doesn't appear likely an ACA extension will be part of a Continuing Resolution unless this shutdown drags on for weeks and Democrats have stood firm in the face of every negative thing the current administration can do to their states. Polymarket puts the ACA premium subsidy in the first funding bill at 7% odds (source).
- So what about after the government re-opens? John Thune has stated he is open to talking about it (source):
- He insisted he would not negotiate on the substance of an extension while the government is closed. But pressed on whether he was open to discussions with Democrats about how the health care negotiations might work post-shutdown or how to advance full-year appropriations bills, Thune said, “We are.”
- But that wording has gotten a bit more nuanced to the negative since that Wed interview. John Thune has been using wording that he isn't sure that the votes are there to extend the ACA subsidies (one source). It isn't a popular thing among the GOP House. They always could have extended it during the "One Big Beautiful Bill" earlier this year at zero accounting cost (as they ruled extending existing policies didn't need to be taken into account when balancing the budget at that time to extend Trump's tax cuts).
- So overall the odds for an extension have dropped as the week progressed with the GOP arriving at a unified "no negotiating" stance and just playing hardball. There isn't much time to actually get the extension done (as this NPR article points out today) and it is looking like the this shutdown will drag on for while. Polymarket has October 15th or later at 66% odds as I write this (source).
- This is a short 8 minute video from yesterday that summarizes things well: https://www.youtube.com/watch?v=wN7V_nrjKg0
So... I am kicking myself for not holding my positions longer but did get a bonus amount out of the healthcare stock rally with a smaller leveraged position. I focused on $CNC as they get their revenue primarily from two sources: the ACA and Medicaid. $CNC keeps going up even as ACA extension odds have dropped - and it could continue to rise but I'm done with that ticker for now. Just as the ACA tax credits passing greatly helps them, the failure of their extension greatly hurts them and they have priced in quite a bit of that upside at this point.
One might look at the stock chart of $CNC and believe it should have plenty of room to run. However there is still the Medicaid drag that exists and conversations really aren't around reversing those cuts. $UNH has stated they see Medicaid margin issues in 2026 (source):
In Medicaid, there remains a lag between funding levels and member health risk, and we expect this to continue into 2026 resulting in additional margin compression in the business, including a loss within the nondual segment of Medicaid in 2026. Membership losses from early adoption of recent legislation is also factored into our initial views for 2026.
$ELV also had a viewpoint of Medicaid margins not fully recovering in 2026 at the 2025 Wells Fargo Healthcare Conference (source). So while $CNC might go back into its normal trading range, it would be doing do despite weakness remaining in half of their business even if the ACA tax credit extension does end up passing.
One last bit of oddity was that a bunch of ATM 10/10 puts were traded on the ticker. Unsure if they were buys, sells, or will translate to Open Interest on Monday. Potentially some type of spread as the volumes are similar. They were the following that dwarfs calls that were bought for next week:
Current Realized Gains
Fidelity (Taxable)
- Realized YTD gain of $46,213. Total account value: $608,974.
Taken from Active Fidelity Pro
Fidelity (IRA)
- Realized YTD loss of -$2,779. Total account value: $38,665.
Taken from Active Fidelity Pro
IBKR (Interactive Brokers)
- Realized YTD gain of $104,119.55.
Overall Totals (excluding 401k)
- YTD Gain of $147,553.55
- 2024 Total Loss: -$249,168.84
- 2023 Total Gains: $416,565.21
- 2022 Total Gains: $173,065.52
- 2021 Total Gains: $205,242.19
-------------------------------------- Gains since trading: $693,257.63
Current Positions
I have a tiny bet on the market seeing a pullback before or at monthly OPEX. There are several catalysts for it like the shutdown continuing, the fact that economic numbers outside of AI have continued to stink (ADP at -32,000 jobs, US Services ISM numbers were poor, etc), and just that valuations remain elevated. I'm well aware that a long lasting government shutdown isn't likely to have much of an economic impact (one good article about that) but just the lack of data to understand how the economy is doing could make some traders fear the worst if private data keeps coming in negative. Potential loss is limited by keeping the sizing of this bet tiny.
Otherwise the narrative remains unchanged: valuations are elevated but everyone expects momentum to keep the market generally going higher this year. AI Capex by companies especially just keeps increasing showing ever increasing optimism by those in that sector around the technology and it is nearly impossible to imagine companies in that sector failing to meet expectation. The majority of the economy remains looking weak but does it matter to the market when the AI bubble is still inflating and those stocks make up the majority of the indexes?
Old Memes
Youtube gave me a recommendation of an old fan song about Vito's song thesis that had me nostalgic for the old days: https://www.youtube.com/watch?v=eli8Cuwe8YY
That had me look up this old Endgame parody that included many old members from this sub: https://www.reddit.com/r/Vitards/comments/oizgfn/vitardvengers_endgame/
Just kind of surprised that kind of stuff doesn't really exist today elsewhere. Is there an trading sub dedicated to the AI stock thesis for example? (Well - one that isn't a cult and based on actual analysis). I was a different trader back then and I wonder if that type of trading thesis community will ever come back. With $MT's recent rise to finally look to hit our old price targets on this board, perhaps we were all just four years too early with much of the original thesis.
Conclusions
That's it for this minor update. Mostly back to cash having taken the small bonds profit from yields falling on the shutdown. I'm back to around what I would have been up had I done $SPY shares at the start of the year and that is a vast improvement from what I had lost on the $UNH trade. Now to just wait to see what looks to be best to place my money as things develop (ie. yields up to buy bonds again, a market dip to consider stocks, etc). Overall planning to use far less leverage going forward on whatever I do trade to try to avoid going back to negative YTD and just the fact that no one knows when valuations might suddenly matter again.
One can follow me on Bluesky or AfterHour for sporadic random updates outside of here. Feel free to comment to correct me if you disagree with anything I've written as I'm always open to reconsidering my current thinking. As always, these are just my personal opinions on what I'm doing with my portfolio. Thanks for reading and take care!
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