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Monday, February 6, 2023

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Hemp Boca Portfolio Review – 9-17-2019

OK, so let’s see if I can actually bring myself to shut down the portfolios.  We’ll start with the Hemp Boca Portfolio as it’s small and I should go on the show this afternoon (haven’t decided yet).  

Hemp Boca Portfolio Review:  This portfolio is not as constrained as Money Talk as there’s a show every Tuesday and I can go on when I want (PSW Investments owns 20% of Hemp Boca).  We started back on May 21st so it’s 4 months old and we’re up 8.2% but we were down about 20% at one point (same positions) so I’m not sure I want to risk Q4 in such a small and new portfolio.

The question is, as it will be with EVERY position in EVERY portfolio this month – do we, right now, want to be in this position if the market drops 20%?

  • IMAX – Worst case is owning IMAX for $20 and I’m generally fine with that but you have to keep in mind it’s a $50,000 portfolio with $100,000 in ordinary buying power (we’re assuming not IB as those guys are crazy!).  It’s a conservative position that’s in the money and we should have good support at $21 and $20.50 held on the last dip so hard to kill – especially as I expect Q4 to be huge box office for IMAX.  Max possible on the spread is $4,000 and now net $2,325 so $1,675 (72%) left to gain by Jan seems like one we should keep.  Damn it!  This is hard…

  • M – We are ahead so we’re going to kill it.  Not actually ahead, down $900 on the overall position but too risky for the small portfolio in an uncertain market.  

  • MJ – Back to the lows on this one but I want to stick with them.  

  • TAP – Had a nice pop and we’re on track at net $7,500 out of a potential $20,000 but, if we spend $3,200 to buy back the short puts, we reduce our risk and still have a $20,000 spread – it only increases our net cost from $4,750 to $7,750 but, since that will make us net $10,700 (no more short puts to subtract), then we’re in the spread for a very good price without so much downside risk and we still have $9,300 (87%) upside potential.    

  • THC – We just added these and they blasted higher and we have a 20% cushion to STILL be in the money – what’s not to love?  The net is now $3,762 out of a potential $7,000 so $3,238 (86%) left to gain – another keeper.  

Well, that went terribly.  It’s very hard to shut down good positions.  At least I feel less risky without those high Macy’s puts and the big TAP obligation.  If all goes well, we have $14,213 of upside potential that we’re confident in plus whatever MJ makes and we’re up $4,110 already and $18,313 would be 36.6% over 2 years in a $50,000 portfolio we started 4 months ago – that’s not a bad start! 

Best of all, we are still mainly in CASH!!! so we can DD on any or all of our positions if the market does turn lower.  

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