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Philstockworld September Portfolio Review

Image result for one million dollars animated gif$1,199,597!

That is DOWN $195,130 for our paired portfolios for the month, but still up over 100% for the year.  We have a very large, very volatile bet on Tesla (TSLA) that we're riding out and that let both to last month's huge gain and this month's huge loss but last month showed us the massive potential the position has as it's currently net -$881,087 so, if TSLA ends up between $300 and $380 in January (now $450), we stand to almost double our entire portfolio on that one position.   

I was going to say I don't like the super-volatile positions but that's not true – I do like them as we're selling TONS of premium to people who think stocks go up or down forever and have no rules but I DON'T like them in margin-limited portfolio or in portfolios that aren't miles ahead and can afford to take chances.  Not only can we afford to take a chance this year but we're also locking in our 100% gains using TSLA as it pays us almost as much to the downside ($881,087) as our entire Long-Term Portfolio (LTP) is worth ($1,043,965)! 

But, spoilers, let's just take a look at where we stand and move on from there.  As we expected, the Fed and Congress have fired their stimulus guns this week and the reaction from the market has been a big shrug as evidenced by the shouldering down move in the S&P 500 this week:

While that's going on, Donald Trump's victim count is hitting 200,000 but that's nothing compared to what we're about to see as our kids finish their second week at school as two weeks is just about the time when it's already too late and local Governments realize what a huge mistake re-opening too early has been.  While we know Trump doesn't care about California and New York having 100,000 combined deaths this year, he'll be losing 60,000 voters in Florida and Texas as well.  

Early indications are that sending the kids back to school is already becoming a "super-spreader" event for the whole country and 50,000 more Americans will be dead by election day (45 days) and over 200,000 more Americans will die of incompetence (and that's being kind) before Joe Biden can be sworn into office in January – just 4 months away.  

This is the environment in which I am advocating playing the markets with extreme caution.  We don't know what the future will bring but it sure is good to have some CASH!!! on the sidelines for whatever may come along so it's all about protecting our wealth at the moment – and the hedges reign supreme.

Short-Term Portfolio Review (STP): $160,357 is up 60.4% for the year but down $254,797 from our last review as TSLA does another one of their wild swings.  Our STP is not supposed to be up when the LTP is up – we've just been very spoiled this year with some fortunate calls but mostly it's because we were miles ahead that we gambled on TSLA, which is both an excellent hedge (as it's not likely to stay up if the market falls) and a bet that's hopefully going to pay off – even in a good market.

Is the market good?  That's the big question.  We have left so many positions alive in the LTP we HAVE to have some massive hedges to protect what is now over $1M in longs but, in reality, we've made no progress from $1.2M (up 100%) that the LTP/STP hit in June so a pretty dead summer spent keeping our money safe.  

  • CANE – Well it's tracking properly.  Sugar is up 20% since we went in and CANE is up 20% too but only just now putting us in the money.  Now the fun starts, hopefully, if we can break over that resistance.

  • TQQQ – We got more aggressive and we just have the long puts.  If the Nasdaq falls 10%, TQQQ falls 30% to $85 and we have the same $75,000 we have now.  We already made $7,000 on the short puts so I don't think there's enough upside here to justify keeping it - done with this.

  • INTC – Newish.
  • WBA – New
  • SQQQ – Well, we just cashed in $86,750 on TQQQ so how can we put that to good use?  The SQQQ Jan $25s are out of the money at $7.30 and we paid net $2 for the spread so how do we take advantage of that and reduce our Theta Decay so we're not the suckers paying the premium?  It's a 3x ETF so a 10% drop in the Nas will give us a 30% pop to $34 and our short calls are $35 so that works.  I think what would make me happy is rolling our 100 SQQQ $25 calls at $73,000 to 200  of the June 2021 $15 ($13.50)/30 ($8.50) bull call spreads for net $5 ($100,000), using some of the TQQQ money we just cashed.  So we're taking net $59,750 off the table but we've moved our SQQQ protection to a $300,000 spread (was $100,000) that's $200,000 in the money so the only way we can lose on this hedge is if the Nasdaq goes higher – which is good for our longs.

  • SDS – That one's at the money.  SDS is only a 2x ETF so 10% down on /ES takes it 20% up to $19.50 so, like SQQQ, we may as we capture our $4.05 before it starts to decay.  The 2022 $15s are $4.05  and the $10s are $6.20 so $2.15 to roll $5 into the money is a great idea but we just invested in SQQQ so we can pay for this one by rolling 300 2022 $15s at $121,500 to 200 2022 $10s at $124,000 and now we're $120,000 in the money at $16 and, when those short Jan calls expire, we can sell calls like the 2022 $20s for $3 and take half our money off the table and still have a $200,000 spread that's mostly in the money.  

  • CMG – Finally came down a bit but we still have to roll our 3 short Sept $1,050 calls at $56,160 to 5 short Jan $1,200 calls at $135 ($67,500) and we will sell 2 Jan $1,100 puts for $55 ($11,000) and then we'll see how earnings go.  

  • TSLA – Just have to be patient with this one but, officially, next time we're green on the short calls, we should put tight stops on 1/2 so we're not so volatile.  We don't need this much hedging – we're well-covered above.  By the way, notice the short Jan puts are a ridiculous $106,050 – if we do end up having to roll, that's free money we'll be able to use to offset the cost as we can't lose both ends. 

  • UNG - We lost ground on the pullback but let's take advantage and buy back the short $12 calls.

Long-Term Portfolio Review (LTP):  $1,039,240 is up 107.8% from our $500,000 start for the year and THAT is what we're protecting with our Short-Term Portfolio, which hedges our long positions – but also gets to make the fun bets when we're ahead.  The LTP isn't allowed to have fun – it simply grinds out gains and, when we are nervous, like we were last month at $979,575, we begin to remove risk and get to more cash in our long portfolios.  

Now we are down to just 4 naked short puts which, as our long-time Members well know, is very small for our LTP.  It simply means we're not seeing enough bargains out there that are worth taking a chance on and it's a pretty negative market indicator.  We cut half of them last week: IBM, JO, STZ, FCX and TIF and we also bought back puts in BRK.B, and killed VIAC and VLO entirely.  All those positions were big winners – we just didn't want to risk our winnings.  

Cash is up from $406,390 to $413,895 and risk is down and we also have tremendous hedges from the STP above so I don't feel a lot of pressure to reduce the remainng positions but let's see how they look.  The Volatility Index (VIX) is very high – so we may be able to take some premium-selling advantage:

  • HMNY – Nice net $2 per share entry is our worst case.  
  • KO – Net $38 potential entry – yes please!
  • MU – Net $25.50 potential entry – 50% off!  
  • MYL – Net $11.50 potential entry – one can only hope…

So our short put strategy is pretty simple, we see stocks we'd REALLY like to own that are a bargain and we offer and even more ridiculously low price to buy them in the future in exchange for MONEY NOW!  In this case, we collected $21,000 for promising to buy the above stocks at those insane discounts.  This is a mainstay of our LTP strategy though we have far less than our usual dozen or so offers at the moment as we think the downside market risk is too steep to be complacent.  

  • BRK.B – We bought back the short puts on those but we feel very confident the long spread will pay the full $30,000 and it's now only net $23,212 so $6,788 (29%) left to gain is not thrilling for 18 months but it doesn't suck and we don't have anyting better to do with the money and we don't think the position is very risky – so it stays.  HOWEVER, while we are waiting, I also don't see why Berkshire would be hitting new highs and it IS at the top of the channel so how about we make another $5,000 (21.5%) selling 5 Jan $220 calls for $10.

  • CAT – Way over our goal.  Net $16 out of a potential $20.  Same logic.  
  • PAA – On track.
  • AVGO – Miles in the money.  Net $83,550 out of a potential $120,000 has a long way to run.  Good for a new trade almost.

  • BRK.B – On track.
  • CSCO – On track

  • FL – On track.
  • GILD – On track 
  • GM – On track.
  • IMAX – Just net $5,500 out of a potential $20,000 so great for a new trade.

  • INTC – We are aggressively long on INTC and I'm fine with that.  '
  • LABU – A mile over our target at net $26,050 out of a potential $50,000 so good for a new trade with almost 100% upside but our net entry was a $13,000 credit, so we'll make $63,000 (480%) if LABU can manage to hold $35.  If you wait PATIENTLY for good stocks (or ETFs) to become cheap – you can make some very nice trades – and work and worry a lot less!  

  • M – Very aggressively long.  
  • MIDD – It's a $90,000 spread at net $39,100 so it pays another $50,900 if MIDD holds $75 into Dec.  That's 130% you can make in 3 months as a new trade!

  • MJ – The bull call spread is on track but we may have been too aggressive with the short puts.  
  • MMM – On track.
  • MO – On track.

  • RH – 100 miles in the money and it's an $80,000 potential trade at net $67,925 so no reason to kill it with 17.7% left to make.  It only matters if we have a better use for the cash, which we don't right now.  
  • SKT – Signs of life at the $6 line.  Nothing to do here but be patient.

  • SPG – On track.
  • SPWR – "Hey Phil, why didn't you tell me about SPWR???"

  • T – See, we still buy stuff.  Even cheaper now.
  • TXT – On track.
  • WBA – We got aggressive and they finally seem to have found a bottom.  Still good for a new trade.

Earnings Portfolio Review:  $191,733 is up 91.7% for the year and it's up $9,186 (9.2%) since our 8/17 review and we've done nothing all month but leave it alone to make those gains.  It's a very well-balanced set with good growth potential so no reason to mess around with something that's working so nicely, is there?

  • HRB – Left over put leg from the trade we took off the table.  Certainly not worried about owning 1,000 shares at net $9 so no reason not to leave it there.  

  • WBA – Newish entry, even better now so let's add a bull call spread like 25 2023 $30 ($10)/$40 ($6) bull call spreads for net $4 ($10,000) and we'll see how things go.  

  • IRBT – This was our original Stock of the Century back in 1999 when it was below $10 and then it hit $100 and we were done (and they spun off their military division, which was our favorite part) but then they won us back with all their cool consumer stuff but they were too expensive until this crash – so we jumped back in after PATIENTLY waiting 3 years for a chance.  We bought back the short-term short calls and short puts and that leaves us with a bull call spread that can double up or we can add short puts again on a sell-off.  

  • SQQQ – We just added this new hedge to replace the old one.  So far, so good.

  • ACB – They never really got it together but it's a small play so let's give them some time.  It won't take much of a positive spin from ACB to get them back to $20.

  • GILD – Nice, newish trade we added and still a good entry.

  • HBI -  Our co-stock of the year in 2018 (with LB) is now a solid performer we're happy to own.  


  • INTC – Another newer addition to the portfolio and even cheaper than our entry at the moment so still good for a new trade.  

  • M – This is a tough call during a crisis. We have such a good entry and I consider it to be such a great value.  I can't pull the plug on this one nor can I see covering it so it stays.  

Butterfly Portfolio Review:  $372,941 is up $60,482 (19.3%) for the month and, once again, the power of doing nothing is demonstrated!  As I had said last month "we'd be up a lot more if our short AAPL calls weren't killing us at the moment" and that moment has now passed and all is well again.   

  • AAPL – It's still hurting us as the premiums on the June 2022 $100 calls is ridiculous as they are at the money at $24.70.  The bottom line is that, at 0ver $100, the spread is worth $400,000 and it's currently net $227,200 not counting the short puts so it's good for a gain of $172,800 (76%) if AAPL can hold $100 into June 2022.  That's more than enough gains for this whole portfolio for the next two years!   Good for a new trade!  

  • AMZN – What a lot of legs!  Thankfully they pulled back a bit but we're in very good shape as it's a $180,000 spread that's net -$10.965 and the short $3,000 calls are 100% premium and, of course, we will roll them if we have to.

  • DIS – This one is on track and the short puts will expire worthless and we'll have to roll the short Sept $115 calls at $14 to the short Jan $120 calls at $14.70 as I still want the downside protection.  I don't want to sell puts at the moment as we're dangerously close to breaking under this channel (and I think we'll be back on lockdown soon).

  • F – On track.

  • KO – Went from being very flat at $55 to being very flat at $50 - a perfect butterfly play!   This is just the kind of chart you want to use for this kind of investing (selling short-term puts and calls for income).  We sold the short Sept puts and calls for $4.35 and we have to pay back $3.35 so we make $500 this quarter and that's bonus money against our long gains.  We can sell the Jan $50 calls ($3) and puts ($2.70) as $50 is a good target.

  • MDLZ – Also perfect but doesn't look like it as they've fully recovered but now they can flatline for 2 years.  We sold the $52.50 puts and they will expire worthless for a $3,750 profit and now we can sell 15 Jan $55 calls for $3.75 and no puts in case we have a sell-off.  

  • MJ – We sold $4,000 worth of premium in July and we have to pay it all back, unfortunately but we'll try again with the sale of 20 Jan $12 calls for $1 ($2,000) and 20 Jan $11 puts for $1.40 ($2,800) 

  • WHR – We repositioned our bull call spread, cashing in the original.  I think it's too scry to sell more calls or puts against so we'll just see how this channel resolves itself for now.  

Future is Now Portfolio Review:  We've been doing very nicely (up 67.4% for the year) but it is risky times so let's cash in our short puts, which are over 80% anyway (ALB too) and make room for more Futuristic trade ideas down the road.  

Since we don't have hedges, cashing the short puts reduces our downside risk and we REALLY want to own our other positions, so we're not worried about those puts but let's see if they are worth keeping:

  • ARNC - This is an $8,000 spread and it's currently net $8,725 so we should really cash those out, right?

  • BYND – This is a $25,000 spread at net $21,985 so I guess there's no point in waiting 16 months for the last $3,015, is there?   

  • SPWR – We liked them so much we played them twice!  We have the $20,000 spread that's currently net $11,170 so that's good for a new play!   Then we have the older $28,000 spread that's currently net $13,640 and that's good for a double too if SPWR doesn't fall below $12 – so both of those are keepers.

See how I snuck that in there?  We just killed the Future is Now Portfolio, other than SPWR, which my hands got sore from banging the table on early this year but at least we added JETS and we'll look for some more bargains as earnings season comes around again.   

To reiterate, out new trade idea for this portfolio (from the Morning Report) is:

Stimulus talks are still up in the air with the Airline Industry hanging by a thread.  Yesterday, the Democrats tried to extend the previous aid to the airlines through March but Republicans blocked it – because then it wouldn't have been seen as coming from the President himself, so 38,000 more workers are furloughed through inaction.  

As we can see, the XAL Airline Index is about to run into serious resistance at it's own strong bounce line, which is also the rapidly declining 200-day moving average.  XAL feel from about $115 to $35 and that's 80 points so a weak bounce is 16 points (20% of the drop) and a strong bounce is 32 points so 51 and 67 would be the key lines to watch and you can see the consolidation happened at 51 (very violent) so now it's likely we'll test 67 and we're only at $58.22.

So, if you believe in Donald Trump, who said he wanted to help the airlines, this would be a no-brainer of a bet as the Strong Bounce line is over the 200 dma and the 5% Rule™ beats TA so the move over the 200-day moving average will be interpreted as bullish on the chart and we should get a nice kick higher once they work out some kind of stimulus for the airlines


JETS is the US Global Jets ETF and it's got LUV, DAL, UAL, AAL, ALGT, CJT, AC, ALK, JBLU and ATSG as it's top holdings.  As we discussed in the Webinar yesterday, we're about a year away from herd immunity, vaccine or no vaccine and the airline industry is vital to our national security and JETS includes cargo carriers, who are actually doing OK at the moment, with all the shipping we're doing.  

So that makes a 2023 spread on JETS kind of interesting with Trump promising to save the airlines and the Democrats trying to save the airlines.  Eventually, hopefully, SOMEONE will actually save the airlines.  For a trade in our Future is Now Portfolo, I'd go for:

  • Sell 10 JETS 2023 $15 puts for $4.40 ($4,400) 
  • Buy 15 JETS 2023 $15 calls for $6.50 ($9,750) 
  • Sell 15 JETS 2023 $25 calls for $3.65 ($5,475) 

That's a net $125 credit on the $15,000 spread so, if all goes well, it will make $15,125 (12,100%) if JETS is back over $25 in 2023.  Worst case is owning 1,000 shares at $15 (less the $125 credit) and we can always sell calls to lower that risk if we lose confidence but it's a nice, optimistic bet on things getting back to normal – one day.  Ordinary margin requirements on ETFs are pretty low, just $841 for this one so it's a very margin-efficient trade as well!  

Dividend Portfolio Review:  Back in black, baby!   Our dividend stocks took a huge hit on the dip and have been slow to recover but they are back up 6.7% for the year which is actually on track as they were never meant to be big winners – just long-term income producers.

CHL – We just got assigned another 500 shares and I'm fine with that.  Clearly too low in the channel to sell calls but maybe some more puts.  We can sell 5 of the 2023 $30 puts for $4.80 and that nets us in 500 more shares at net $25.20, which would bring our average cost per share down to $33.90 – not far from where we are now.

ET – A bit lower than we hoped but starting to recover.  

MO – Wild ride on this one and we'll just have to see how it goes.

SPG – Doing surprisingly well for a mall REIT during the crisis.  At our goal, in fact.  

TWO – Another REIT that's right on track.

F – On track.

M – The 2022 $13 puts are $7.53 and the 2023 $10 puts are $5.35 so let's roll 20 of the 2022 $13 puts ($15,060) to 30 of the 2023 $10 puts ($16,050) for $990 and we originally collected $7,600 so $8,590 credit is $2.86 if assigned at $10 for net $7.14 – not a bad goal.  

SIG – Came back nicely but not paying a dividend.  Let's cash them out.

SKT – Still down in the dumps but I love them.

T – Very tempted to buy more here but it's earnings season so we'll see what goes on sale.


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  1. good morning 

  2. Phil/WBA thanks for recommending yesterday. but i didnt quite follow.

  3. i m short 10 2022 wba 35 put at 4.19

    long 15 2022 bcs 35/50 at 6.02.  


    Phil/wba you said spend 3.5 to roll to 2023 $30 calls and roll short 2022 50 calls to jan 40 calls at 1.85. with stops for 2/3. 


    does that mean the puts stay as is and i end up with 2023 30/40 bcs? not sure?

  4. Good morning!  

    WBA/Stuart – No, I meant I'd roll the short 2022 $50 calls to the short JANUARY 2021 $40 calls at $1.85 because those will expire and you can keep selling quarterlies against your 2023 $30s and make a lot more money selling premium.  

    Opening looks a little weak.  News cycle will not be kind this weekend with 200,000 deaths dominating the discussions.

  5. ok thanks Phil

  6. Good Morning.

  7. Finished the LTP.  Long day ahead…

    Indexes getting weaker.  /RTY clearly the laggard and shortable below 1,547.50 if that breaks with very tight stops above or if /NQ retakes 10,950.

    Stick saves at the EU close. 

    Damn, that was obvious at $2! 

  8. Phil / IMAX – for a new position, with the longer dated Options, What would you recommend on this one?

  9. Phil / CLF – nice pop today I did not see any news on this ? did you?

  10. Phil

    What do you think a fair price is on AAPL


  11. IMAX/Batman – I think I said yesterday they're not really trading yet so too early to tell.  Target-wise, I'd say $20 is a good goal so the March $10/20 spread is less than $4 so if I could get $3.75 or better on the 2023 $10/20 spread, that would be very attractive and the short 2023 $15 puts should be about $4, maybe $4.50 so I'd offer $4.50 and hope for a dip.  

    CLF/Batman – X moved up on a price increase so they popped with the sector assuming everyone will benefit.

    AAPL/QC – They should make close to $60Bn so I'd pay $1.2Tn for them and they are currently $1.8Tn so $107 is 50% more than $70.  Given it's AAPL I'd go $85 to initiate, I suppose.  

    Just because they are less overpriced than they were doesn't mean they are cheap.

    Year End 28th Sep 2014 2015 2016 2017 2018 2019 TTM 2020E 2021E CAGR / Avg
    Total Revenue

    182,795 233,715 215,639 229,234 265,595 260,174 273,857 273,025 308,561 7.31%
    Operating Profit

    52,503 71,230 60,024 61,344 70,898 63,930 67,138     4.02%
    Net Profit

    39,510 53,394 45,687 48,351 59,531 55,256 58,424 56,768 64,745 6.94%
    EPS Reported

    1.61 2.30 2.08 2.30 3.05 2.97 3.29     13.0%
    EPS Normalised

    1.61 2.30 2.08 2.30 3.05 2.97 3.29 3.24 3.87 13.0%
    EPS Growth

    +13.6 +42.8 -9.88 +10.8 +32.6 -2.62 +14.3 +8.90 +19.6  
    PE Ratio

              37.1 33.5 34.1 28.5  

              4.17 3.77 1.74 3.07  

  12. Phil / /CLF  - thanks – I saw the increase, but nothing else…. I guess all boats floated.  

    IMAX – thanks for the target – I agree. with the $20 as well for '23 10 / 20  - will look at those… see if in can get some movement in the pricing – the spreads are pretty wide


  13. The VIX seems a bit slow to react to the selloff, market not that worried?

  14. VIX/Mr. M – Not that surprised is more like it.

    Nice move down by /RTY but now we're back over the Support Line so we should be looking to stop out at $5,000 or, actually $1,250 per contract.   I just gave it a little slack because the Dow is below S1 at 27,500 still but, strictly speaking, 1,520 should have been the stop.

    • The major indexes are falling into a familiar pattern for the week, where buying interest in tech evaporates quickly and other sectors are left struggling to pick up the slack.
    • The S&P is down 0.6%, the Nasdaq is off 0.8% and the Dow falling 0.3%.
    • Only three sectors are in the green. Financials (NYSEARCA:XLF) are up despite another drop in Citi shares, Deer and Caterpillar are helping Industrials (NYSEARCA:XLI) again and Health Care (NYSEARCA:XLV) is just slightly higher.
    • If the past couple of sessions are any guide, that won't be enough for help the broader market close higher unless technology can catch a bid later.
    • The Fab 5 megacaps are now all lower as Facebook finally gave up early gains. Barclays cut its rating on all the stocks and Netflix today, invoking dot-com bubble valuations.
    • Although as a whole Energy (NYSEARCA:XLE) is down, crude futures are up, helping Marathon Oil, Baker Hughs and Apache to some of the best gains in the S&P.
    • The UK is seeing a second wave of COVID-19 infections coming in, Prime Minister Boris Johnson says.
    • The U.S. stock market took a hit once the headlines arrived, with the major averages falling to their lows of the session.
    • The S&P (NYSEARCA:SPY) is down 1.4% and the Nasdaq (NASDAQ:QQQ) is falling 2%.
    • Only the Financials (NYSEARCA:XLF) are holding onto small gains.
    • Losses in Technology (NYSEARCA:XLK) accelerated, with Apple, AMD and Nvidia all down more than 3%.
    • Johnson says it was "inevitable" the country would see a second wave and that the government is looking very closely as the spread over the last few days.
    • He did not rule out another national lockdown, but said he does not want to go into that "at all".
    • GBP/USD is off 0.2%.
    • Dear readers: We recognize that politics often intersects with the financial news of the day, so we invite you to click here to join the separate political discussion.
    • U.S. life insurers face greater investment risk than insurance risk during the COVID-19-related economic recession, according to S&P Global Ratings analysts.
    • "U.S. life insurers' investment portfolio has so far been resilient to the pandemic and the economic recession. But the recession isn't over yet," write the analysts led by Deep Banerjee.
    • At an industry level, they expect "the strong level of capitalization will offset some potential asset losses and continue to support our current stable outlook on the U.S. life insurance sector."
    • S&P may take individual rating actions based on its "view of changes to capitalization and potential investment losses on individual portfolios."
    • About 70% of the industry's portfolio, or $3.1T, is invested in fixed-income securities; within the FI portfolio, ~75% of bonds are in corporate and government securities, followed by structured finance securities and a smaller amount in bank loans, mutual funds, and exchange-traded funds.
    • Life insurers have increased their holdings of BBB-rated bonds; with close to 35% of their bonds rated in BBB today vs. ~25% going into the last financial crisis. Still, there's a "fallen angel" risk, where investment-grade bonds are downgraded to junk status.
    • The industry has close to $750B of structured finance securities in investment portfolios; total exposure, though, as a proportion of the overall investment portfolio has declined to 24% from almost 30% of the bonds held by these insurers being SF securities in 2008.
    • Says U.S. life insurers' exposure to collateralized loan obligations is relatively low, S&P says.
    • In CMBS, S&P sees insurers shifting investments more toward multifamily and industrial properties compared with office space.

    Kinross upped to buy at BMO on dividend, guidance update

    • Kinross Gold (KGC +9.6%) climbs to within pennies of a multiyear high after announcing it will pay its first dividend in seven years and raise production over the next three years.
    • In reaction to the news, BMO Capital upgrades shares to Outperform from Market Perform with a $14.25 price target, lifted from $13.50, as analyst Jackie Przybylowski says the announcements reward shareholders "with a significant and sustainable return, and demonstrates management's ability to balance a disciplined and conservative approach with reinvestment in value-accretive projects."
    • Kinross says it will continue to use a $1,200/oz. gold price assumption for its mine plans, which Prsybylowski says is conservative in the current environment and a "major positive" as a sign of the company's discipline.
    • KGC's Quant Rating is Very Bullish, and its average Wall Street analyst rating is Bullish.
    • James Bullard, president of the St. Louis Fed, says he's optimistic that the U.S. economy can fully return to where it was before the COVID-19 pandemic.
    • "100% of GDP can be produced safely with enough innovation," he said.
    • Part of that will be keeping interest rates low for "several years… to allow the economy to fully recover from the crisis," he said in an online discussion hosted by Washington University in St. Louis and The Boeing Center.
    • Previously: Fed's Bostic to carefully watch how fast inflation grows (Sept. 18)
    • Apparently aimed a managing supply expectations as COVID-19 vaccine frontrunners move closer to key data readouts and potential emergency use authorizations, Moderna (MRNA -1.2%discloses that it expects to produce ~20M doses of mRNA-1273 this year. Projections for next year, previously announced, are 500M – 1,000M doses.

    That's reality, 20M this year.  I'll get it and you'll get it but people who can't afford subscriptions to stock market newsletters probably will not…

    • Barclays analysts see a further shakeout in the favored big technology stocks and the broader market, saying valuations are at a height not seen since the dot-com crash 20 years ago.
    • Even with the recent selloff, Barclays cuts Facebook (FB+0.4%), Apple (AAPL-1.1%), Amazon (AMZN,-0.4%), Alphabet (GOOGL -0.2%), Netflix (NFLX+0.9%) and Microsoft (MSFT-0.5%) to Market Weight.
    • All the stocks are already down around 15% from their early September highs.

    • “Measures of equity valuations are now at 2000 dot-com bubble levels and appear to be pricing in an ideal scenario,” Barclays analysts say. “We are reluctant to chase the rally by paying above the elevated market multiples and update our price target to 3100 (for end 2020).”
    • That would put the S&P (NYSEARCA:SPY) down nearly 8% from its current levels.
    • None of the megacap stocks get more than a D+ in valuation from Seeking Alpha’s Quant Ratings. See how they fare on more metrics.
    • September Consumer Sentiment78.9 vs. 75.0 consensus and 74.1 in August.
    • Current economic conditions: 87.5 vs. 83.9 consensus and 82.9 prior.
    • Index of consumer expectations: 73.3 vs. 67.8 consensus and 68.5 prior.
    • Consumer sentiment reaches top of the range it has traveled since April.
    • The surveys have traditionally asked consumers which candidate they thought would win the election; data from July to September indicate a virtual tie, Surveys of Consumers Chief Economist Richard Curtain said.
    • AMD (AMD -0.5%) is expected to grab about 20% stake of the notebook processor market in 2020, reports Digitimes.
    • The company has risen about 41% over the last 3 months.
    • Strong demand from the educational sector and shortage of Intel processors may aid AMD demand.
    • Take a look at the performance of company against its peers over the last 6 months here.
    • As the Fed implements its policy of inflation averaging, each Fed policymaker will have his or her own view on how to approach the goal of achieving an inflation rate that averages 2% over time.
    • Atlanta Fed President Raphael Bostic says he'll be paying close attention on how quickly inflation increases, Reuters reports.
    • For example, if inflation rises to 2.3% but appears stable, "that would be fine… By contrast if we were at 2.2 and the next quarter at 2.4 and then at 2.6, that trajectory would give me concern" at which point the Fed would perhaps need to cool the economy, he said.
    • The Fed's shift to inflation averaging comes after inflation has fallen short of the central bank's expectations.
    • Consumer price inflation since 2008:

  15. Phil/WBA – Any thoughts on my WBA trade? Stay the course or make adjustments? Here's what I did:

    Bought 3 Jan 22 $30 Calls $13.70

    Sold 3 Jan 22 $45 Puts $8.70

  16. Not looking like a stick is coming and I have in my notes that Phil said /ES <3300 is game over, watch out.

  17. mrmocha / spy – I think they will stick it over the 3300 mark today

  18. batman / stick – good call, almost to the minutes, let's see if the stick sticks :)

  19. Well, out of time but nothing urgent in the other portfolios.

    WBA/Swamp – I think it's just coming around.  As noted above, nothing to do but wait.  If it makes you feel better, you can roll the 3 2022 $45 puts, now $12.70, to 4 2023 $37.50 puts at $9, for about even and you take a lot of pressure off.  The 3 2022 $30 calls, now $9 ($18,000) could be 5 of the 2023 $30 ($10)/40 ($6) bull call spreads at $4 ($20,000), if you want to play it safer.  

    3,300/Mr M – Yep cutting it close today.

    Have a great weekend everyone, 

    - Phil

  20. CLF – Interesting take with good data

    Cleveland-Cliffs: The Long-Term Investment Thesis Remains Intact


    In spite of the short-term difficulties facing Cleveland-Cliffs, the long-term investment thesis remains intact.

    High exposure to the automotive industry affected share price performance, but this would turn into a tailwind as the sector recovers.

    Cleveland-Cliffs' management continues to execute well on its debt restructuring and capital spend programs.

  21. This certainly makes me feel better about the election….


    Voters on the first day of early voting….And we're off!

    In-person voting has officially started in some parts of the United States for the November 2020 election, with at least 10 states allowing residents to begin casting their votes in September.



  22. Supreme Court justice Ginsburg just died

  23. F. Hopefully Chuck has some Senate rules that allow a delay again.

  24. Peru and Brazil: Stay Home and Starve