Actionable insights — Haymaker Daily: Taking a Big Knife to the Semis

1. The record-vs-history screen — one statistic that identifies a blow-off without any valuation work

1. For any market or sector that has run hard, compute the return over the recent window against the return over its entire prior history — not a P/E, not a z-score, just cumulative gain in months versus cumulative gain in decades.
2. Treat "more return in the last N months than in the previous M years" as a standalone blow-off verdict: it is arithmetic that can only be produced by a vertical price move, so it survives any bullish narrative attached to it.
3. Act on the statistic itself. It gives no top-tick, so it is a signal to begin selling, not to wait for confirmation — expect to be early.
4. Keep a source that publishes these long-history comparisons (here, Grant Williams' monthly missive) so the trigger arrives from outside your own positioning.

• Any "more in X months than in the prior Y years / than ever before" record; how far price sits above its own long-run trend; whether the record is being celebrated rather than questioned.

2. The two-stock engine test — find what an index actually is before you own or short it

1. Before treating a country ETF or a sector index as diversified exposure, decompose it: what fraction of the move came from how few names?
2. If two or three securities drive it, the wrapper is a concentrated bet in disguise — analyse those securities, not the index label, and size the position accordingly.
3. Then look for the same names inside other indexes you own. Shared constituents (or shared end-market) mean the exposures are one position, not two.

• Top-two/top-five index weights and their share of the move; overlap between a "country," "sector" and "theme" fund you hold; the moment the two-stock engine rolls over.

3. The offshore leading indicator — read the same trade where it is most extreme, then date the domestic turn from it

1. Identify the market where a global theme is expressed in its purest, most levered form (usually a smaller market with a dominant industry).
2. Track that market as the theme's leading indicator: it inflates first and cracks first, because it holds the marginal, most-committed buyer.
3. When it breaks, date-stamp the break and check whether the domestic proxy started declining in the same window. A matching start date confirms one unwinding trade rather than two coincidences.

• The purest offshore expression of your theme; aligned start dates between the offshore break and the domestic index; whether the domestic decline is still being explained away locally.

4. "Cheap doesn't save you" — retire the low-multiple defence once earnings are cyclical-peak

1. When the bull case for a fallen sector reduces to "but it's cheap on earnings," check which earnings: a modest P/E on peak-cycle profits is a high P/E on normalised profits.
2. Look for the live counter-example — a comparable name that has already fallen hard while reporting excellent results at a low multiple. If cheapness plus good news failed there, it is not a floor here.
3. Conclude that the price is being set by flows into (and now out of) the theme, not by fundamentals — so fundamental strength is no reason to hold through the unwind.

• Low multiples resting on record margins; a stock falling on a beat; the bull case migrating from growth to value as the price drops.

5. Selling into the hockey stick — a systematic scale-out that does not require calling the top

1. Define the trigger by chart shape, not by a price target: once a position enters the near-vertical "hockey stick" phase, the scale-out begins.
2. Sell in tranches on the way up (dollar-cost-average out) rather than trying to pick the peak — accept being early as the cost of a good average exit price.
3. Apply it "irrespective of how exciting the story sounds": the rule is triggered by price behaviour, so a compelling narrative or a cheap multiple is explicitly not an override.
4. Reserve the outright sell (rather than a trim) for the rare case where the record-vs-history screen fires — the discipline is graduated, not binary.

• The point where a chart's slope goes near-vertical; whether your tranches are pre-scheduled; the temptation to stop selling because the story has improved.

6. The bounce is an exit — pre-commit to selling the rally before it arrives

1. After a violent decline, expect a sharp counter-trend rally: "the sell-off… has been so intense that a bounce before long is possible, even probable."
2. Decide in advance what the bounce means. If the decline followed a genuine blow-off, the rally is an opportunity "to once again reduce exposure," not a re-entry.
3. Scale the caution to the prior excess — "the bigger the bubble, the bigger the bust" — so the larger the preceding blow-off, the more of any rally you sell.
4. Distinguish this from a washout buy setup: the same team buys beaten-down groups (miners, oil services) when the drawdown follows apathy rather than mania. The prior mania is what flips the bounce from entry to exit.

• How much of the prior advance has actually been given back; whether the drawdown followed euphoria or apathy; a rally arriving on no fundamental change.