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Thrilling Thursday – Up and Up We Go!

Retail Sales are Up 10%.

Isn't that exciting?  9.8% actually but close enough.  In a typical month, Retail Sales average $550Bn so up 10% is $55Bn and we only had to distribute $300Bn worth of Stimulus Checks to get it (not to mention March has 10% more days than February, but who's counting?).  Aren't economics fun?  You can manipulate the data to get any result you want if you plan ahead!  

It's my job to cut through all the BS and tell you  what is really happening.  You have to look behind the data, like the price of gasoline rising 10% in February and Gasoline Sales contributed $10Bn (20%) of the $50Bn bump.  Restaurant Sales were up 13.4% as restaurants re-opened and clothing stores jumped 18.3% as people went to malls for the first time in a year.  

This is, generally, good news but to get all excited about a report that, in effect, shows that 20% of the stimulus checks were spent by the people who got them – is not really a solid premise for forecasting future growth.  Nonetheless, the Dow is making new highs and the S&P is near them as it's a good headline to start the day with in the markets.

Earnings have been good so far and continue this morning.  Delta was a big miss, losing $1.85/share – 50% more than expected and we'll see if they get a pass at $48, which is only $30Bn in valuation and DAL, in a good year, makes about $4Bn but last year they lost $12.4Bn and this year a good $2Bn will fly out the window so it's hard to get excited about paying $30Bn for a stock that's made net $0 in the past 5 years.  

You know I prefer to play based on Macro News and we're not sure how travel will pan out in 2021 but we do know that the housing market is 4M homes short of demand – almost 3/4 of annual sales and that means we need to look at the builders and find some to add to our portfolio.  Our favorite builder, Hovnanian (HOV) has gone to the moon since we played them last and they'll probably justify $100 – but it's hard to spend that when we last bought them at $20.

PulteGroup (PHM), on the other hand is still under-recognized at $53.50 as that is just $14Bn in market cap and PHM made $1.4Bn last year and should grow a good 10-15% for the next couple of years so it's very hard to imaging they can fail $50 and $40 should definitely hold.   That means, in our Long-Term Portfolio (LTP), we can promise to buy them for $40 and consider the money we get paid to make that promise to be Free Money – as it's not costing us anything since we REALLY would like to buy PHM for $40:

  • Sell 10 PHM 2023 $40 puts for $4.50 ($4,500) 
  • Buy 20 PHM 2023 $40 calls for $17.50 ($35,000)
  • Sell 20 PHM 2023 $55 calls for $10 ($20,000) 

That's net $10,500 on the $30,000 spread that's almost all in the money to start so all PHM has to do is not go lower and we will make up to $19,500 (185%) in 18 months – a 10% monthly return on our cash.  The margin for selling the short puts is just $2,558.80 so it's an efficient play but of course that can increase if PHM goes down but, since we're very happy to pay $40,000 for 1,000 shares of the stock and we have allocated for it – it's really just a smart way to put our sidelined cash to work.

I'll be reviewing our Member Portfolios in our Live Member Chat Room today and tommorrow.  

 


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  1. Good Morning.


  2. I hope the disbelievers of my MRNA did not jump off the train to early. 

    MRNA210416P120 16-Apr-21 120 3 PUT 7.58

    MRNA210416P130 16-Apr-21 130 -3 PUT 11.06

    1050.00  Not bad for a no cash outlay in 74 days


  3. Hey all! Really nice action on GLD and gold miners (GDX) this morning.


  4. Good morning!  

    Since the Dow never, ever stops going up, I think it would be fun to take $800 and buy 1 DIA May $337 ($6)/339 ($5.20) bull call spread for 0.80 as that will pay back $2,000.  Next month we turn $2K into $4K and June is $4K to $8K and then $16K, $32K, $64K and, by September – well over $100,000.   Not a lot of risk and fun if it works (would have worked 8 of the last 12 months).  I wonder if we'll beat BitCoin?  I'll put 5 in the STP as it's a hedge against the market NOT going down that will offset some losses there.


  5. Phil that spread is gone up to 1.73. You must have a much better Broker


  6. DIA/Yodi- It popped too fast, no play unless we get back under $1.






  7. Phil / Infrastructure Plan –  Research on the infrastructure plan is on-going….   I'd like to start a discussion on any information the group has on this….   at a high level I'd like to understand What industries will benefit, and once we understand that, go into these and ID the best companies within the industry and pick strong companies that will leverage this plan.      Below is one article I found interesting and informative at a very high level…  

    What President Biden’s $2T+ American Jobs Plan Could Mean for U.S. Infrastructure

    https://www.globalxetfs.com/what-president-bidens-2t-american-jobs-plan-could-mean-for-u-s-infrastructure/?utm_source=Bloomberg&utm_medium=native&utm_term=5-Things-to-Start-Your-Day



  8. Short-Term Portfolio Review (STP): $177,376 is down $43,097 from our March 18th review, so I hope the LTP is poppin'.  If we're not losing money in the STP during a rally – we're doing it wrong but we'd better be making it up on the way down, of course.  Friday we made some aggressive adjustments so I'm not sure we need to do anything at the moment:

    • XRT – You would think it would have taken more of a hit on today on that Retail Sales Report.   I think people are waiting for earnings to decide and that was our plan so we'll just see what the early results look like.

    • FXP – Net $4,480 and we sold the June $35s for $3,280 and the Sept $40s are $2 ($8,000), so it will be a free spread if we stay flat and a nice profit if it goes higher and a small loss at worst.  All good!  

    • TQQQ – We got more aggressive Friday and that hasn't helped but it has made the roll from the Jan $100 puts ($20.23) to the Jan $120 puts ($30.20) less than $10 ($20,000) so let's do that and the April puts will expire worthless and we'll sell 10 June $100 puts, now $7.25 for $10 on a dip or, if not, we'll sell higher puts for $10 to pay for 1/2 of the roll.  We can give it until Monday – maybe we'll get lucky.

    • CMG – We'll roll the 5 short April $1,450 calls at $76.35 ($38,175) to 4 short June $1,500 calls at $95 ($38,000) so we're doing an even(ish) roll to a higher strike with 20% less exposure – nice!  We're down on the long puts too so let's sell 5 of the June $1,400 puts for $31 ($15,500) and use that money to roll the 6 Jan $1,400 puts at $106.30 ($63,750) to 5 of the Jan $1,500 puts at $150 ($75,000), so the sale pays for the roll and we still have a $50,000 spread and plenty of time to roll the short puts lower (not to mention collect more premium).  

    • SCO – That went the wrong way on us.  The April $8 short calls will expire worthless and we're in this spread for net $2,125 so it's free to play after we collect another $2,125 so no hurry – we'll leave it open for now and hopefully catch a move up – if oil ever gets cheaper again.  

    • SQQQ (1) – At the money is not ideal as it's $10 and a 20% drop in the Nas will only take us to $17(ish) so that's $70,000 worth of protection against a 20% drop and we're tying up $6,700, which isn't too bad.  The cost of rolling to the $5s at $6.25 would be $14,000 and we can sell 100 Jan ('22) $25 calls for $1.20 ($12,000) so it seems silly not to do that as $25 seems pretty out of reach for SQQQ in 8 months.
    • SQQQ (#2) – We did it in pieces but it's essentially 200 long 2023 $10 calls with 200 short $30 calls that we think are extremely unlikely to get hit so we sold another 100 Jan $20 calls, which make the 2023 long $10s close to free and we'll adjust if we have to.  Another $140,000 worth of protection here at $17, currently net $30,450.

    • TZA – Yikes, $33!   At least 1.6 x $33 is $52.80 so it's got some bite to it and we sold the June $60s, so that's perfect.  No point in spending money as it pays $32,500 + $ 52,500 ($88,000) at $53 and currently net $17,225 so still a nice hedge.  The adjustment will be selling 50 July $40 calls (now $3) for $15,000 and using that money to roll the 50 June $32s at $4.50 ($22,500) to the Jan $30s at $9 ($45,000) which would cost net $7,500 for 6 more months of protection – but not yet.  

    • W – So silly at this price.  Back on track and short April calls will make us $5-8,100 as the last $5 of premium wears out.  Earnings are May 6th and we're only in for net $1,400 if they expire worthless so why risk selling more short calls ahead of earnings?  Let's just see what happens.


  9. SQQQ / Rollover / Phil,

    I have the below positions in SQQQ. Could you please suggest an effect roll-over?

     

    06/18/21 – 50 Long $13 Call
    06/18/21 – 50 Short $36 Call
    01/21/22 – 175 Long $10 Call
    01/21/22 – 50 Short $25 Call
    01/20/23 – 150 Short $30 Call
    01/21/22 – 25 Short $15 Put


  10. Phil/CL – Are still holding your CL short?


  11. I like to hear some  good comments, do I use the bazooka now, in the US? Phillip is washing his hands in innocents.

    Dieter,

    Thank you for taking the time to reach out to us.  My name is Phillip Pogue, and I hope my reply finds you well in these trying times. I'd be happy to help you out today!

    I'm sorry but we are not able to assist you with this.  Your options are to leave the shares as they are, or find a non-US broker on your own and talk to them about how to transfer the shares.  We do not have any further information on how you should go about completing this.  I apologize for any inconvenience this may cause.

    If you have any other questions please let us know. We're always happy to help.

    Best Regards,


  12. batman

     

    Good Idea

     

    Here !  Here !


  13. I asked already the other day how many more suckers got cought with CHL with TDA, no response!!!!!!!


  14. Infrastructure – Below are some links to ETFs that are investing in the different areas….  Note I provide this not to suggest investment in it, but as a source of the companies in the 5 general areas – E Vehicles / Charging, Internet, Rail, Roads, Renewable energy 

    If you click on they link will take you to data….

    PAVE: The Global X U.S. Infrastructure Development ETF seeks to invest in companies that stand to benefit from a potential increase in infrastructure activity in the United States, including those involved in the production of raw materials, heavy equipment, engineering, and construction.

    CTEC: The Global X CleanTech ETF seeks to invest in companies that stand to benefit from the increased adoption of technologies that inhibit or reduce negative environmental impacts. This includes companies involved in renewable energy production, energy storage, smart grid implementation, residential/commercial energy efficiency, and/or the production and provision of pollution-reducing products and solutions.

    RNRG: The Global X Renewable Energy Producers ETF seeks to invest in companies that produce energy from renewable sources including wind, solar, hydroelectric, geothermal, and biofuels.

    DRIV: The Global X Autonomous & Electric Vehicles ETF seeks to invest in companies involved in the development of autonomous vehicle technology, electric vehicles (“EVs”), and EV components and materials.  This includes companies involved in the development of autonomous vehicle software and hardware, as well as companies that produce EVs, EV components such as lithium batteries, and critical EV materials such as lithium and cobalt.

    VPN: The Global X Data Center REITs & Digital Infrastructure ETF (VPN) seeks to invest in companies that operate data center REITs and other digital infrastructure supporting the growth of communication networks.

    SNSR: The Global X Internet of Things ETF seeks to invest in companies that stand to potentially benefit from the broader adoption of the Internet of Things (IoT), as enabled by technologies such as WiFi, 5G telecommunications infrastructure, and fiber optics. This includes the development and manufacturing of semiconductors and sensors, integrated products and solutions, and applications serving smart grids, smart homes, connected cars, and the industrial internet.

     


  15. Infrastructure - For Solar / Renawables.  I've done some research on these and come up with the ( related to Solar) and come up with a watch list that includes the following.   I view these at the best companies in industry….  

    ALB – Minerals

    FSLR – Solar install and Mfg

    ENPH – Solar Battery control Tech  supporting solar - 

    SEDG – Solar Battery control Tech  supporting solar - 

    SPWR  - Solar Install and  MFG - 

    RUN – Solar Install and MFG


  16. Infrastructure - For Solar / Renawables.  I've done some research on these and come up with the ( related to Solar) and come up with a watch list that includes the following.   I view these at the best companies in industry….  

    TOT – This is the best positioned Oil Company that has been investing heavily in Renewables – High Dividend and solid plans to move to more materials.  Also has big Staes in SPWR, GTAX, and Wind / Turbine companies

    ALB – Minerals

    FSLR – Solar install and Mfg

    ENPH – Solar Battery control Tech  supporting solar - 

    SEDG – Solar Battery control Tech  supporting solar - 

    SPWR  - Solar Install and  MFG - 

    RUN – Solar Install and MFG


  17. Here is the replay of yesterday's webinar

     

  18. Yodi-I have given up any hope for TDA stepping up to help clients with CHL issue. I have opened an IB account and initiated a transfer of my account to IB. It is my "hope" that IB can convert the CHL ADR's to the underlying shares and thereby be able to make trades on the Hong Kong exchange. We shall see how this plays out. If you are so inclined I suggest ,as I have previously posted, that you email a summary of your experience to the Wall Street Journal reporter, Dawn Lim (dawn.lim@wsj.com) whom I have been corresponding about TDA's gross lack of client support. I have no idea if this will do any good but at least she expressed some interest. My only remaining hope is that the WSJ will eventually report the issue and TDA will at least experience some negative PR. 


  19. Psta, Thanks for your comments. I can not understand that 72K of mine can go up just in thin air. Some one is holding that cash. 

    Obviously to witness what the ass trump got away with, nothing is any more real. The crooks can get away with anything. 

    Did you somehow try to transfer these shares already to IB? 


  20. GOLD/Rick – Glad we got back in.

    Infrastructure/Batman – Sounds like a good idea.

    SQQQ/Jij – June $13s are dead at 0.62 so have to move those.  Jan $25s are $1.20 and 2023 $30s are $2.30 and you Jan $10s are $2.90 and I would roll those out to the 2023 $10 ($4.25)/$30 ($2.50) bull call spreads at $1.75 and you can leave some uncovered or just buy more since they are 1/3 cheaper.  Keep in mind, though, that you will not have very good protection from a short-term drop but a sustained drop will pay nicely so it's really for situations where you would intend to ride out a dip with your positions intact and this becomes a hedge for if they don't eventually recover.  

    /CL/Ravi – Yes, 4 short at $62.44 avg, down about $4K.

    CHL/Yodi – Not up in smoke but you need to make quite an effort to get it back, it seems.


  21. Yodi- I opened the IB account on line via their website. Once the account is confirmed as open, you can then initiate an ACAT transfer of whatever you want to shift to IB- all of the account, some stock positions, cash, whatever. I have already received notice that TDA has received my transfer request and is now in progress. Note that you initiate the ACAT transfer from your new IB account, All done on line and fairly painless. Good Luck.


  22. Future is Now Portfolio Review:  $199,570 is just shy of a double and up $1,748 since our last review.  We only have $54,030 invested, so the positions are doing quite well and, hopefully, something cool will go down in price during earnings season so we can deploy a bit of cash.  We've been watching PLUG, which is still in a nasty downtrend (Accounting Issues) and they are down to $14.2Bn at $25.70 but this isn't a company that makes a profit – per se but, if they hit their revenue targets – profits are only a year away and then they can get to 100x earnings – won't that be fun?  

    • CIEN – $15,000 spread at net $9,000 so $6,000 to go.  See how easy this is when you wait PATIENTLY for a stock you like to sell off?

    • JETS - Bennie!  $15,000 spread at net $8,040 so $6,960 to go and 100% in the money.  I'm a little concerned about the Airlines now but let's see earnings and hear guidance before deciding.  Meanwhile, we can make things safer by buying back the short puts for $1,260.

    • SPWR – Ridiculously in the money.  $20,000 spread is net $16,250 so $3,750 to go there and $28,000 spread is net $22,880 so $5,120 to go there.

    So here we have $199,570 sitting around and just $22,000 upside potential.  Of course we're already up 100% and locked in our gains into Q2, but now we need to find something better than making a 10% return on our  money, right?  


  23. Pstas, Thanks my acc is open. I tried already some simple transactions, they have not yet transferred

    ed.


  24. Hi Phil

    Any news on PSWI?

    Thx


  25. PSWI/Sun – We're working all out on getting Judgment project running and hopefully closing financing on Hemp Project.  Hopefully we can raise a bit of capital though as it's very tight.


  26. Batman- I commend your research and appreciate the cited proposal summary link. About the only missing aspect is a list of "shovel ready" projects. Kind of reminds me of Hopium laced Kool-Aid of a few years back. I try to be apolitical in my investment decisions but the magnitude of this so-called Infrastructure scheme is unavoidable. The proposal reads to me as only a fraction related to what is traditionally thought of as infrastructure (roads, bridges, etc.). The balance reflects our present political condition of climate neurosis and radical chic woke-ism. The hard infrastructure spending is porkapalooza on steroids and thus will likely move forward in some form) given the tendency of bipartisan trough feeding, The balance will be a much harder sell. I am generally not a fan of betting on the come and prefer something more tangible. Thus, I will review your selected firms looking for good values with good risk/reward prospects on present merits. Any fairy dust sprinkling from the Infrastructure deal would be an added plus but not my base premise. This site is all about sharing ideas so again, thanks for your efforts.


  27. FCEL – July 10/15 call spread for a buck.  worth a toss


  28. Thanks…Phil


  29. VIAC also on the cheap again pile.

    Got to wait for the knife to stop falling.


  30. pstas / INfrastrucure – Thanks for your input…..  Yes we've heard this before several times and there different ways to look at infrastructure…  I believe we should be prepared and do the analysis prior to ID some companies that are  best in class, and will benefit from the legislature. However I would not look for companies that will rise with the tide…. I believe we need improvement in Rails, Bridges and Roads, and well as internet / comms infrastructure – I also believe CO2 will be the biggest risk to the planet and it needs to be addressed – Solar, Wind, EV;s, and Hydro will have a lot of tail winds.


  31. The Hottest Features the Rich Are Craving for Their Next Home






  32. We also opened an acc with Tastywork. They gave the following reply.

    tastyworks | Support <support@tastyworks.com>
    Do, 15.04.2021 16:27
    Hi Yolanda,  

    We do not accept any foreign stocks for deposit. If the other firm is holding the shares on the foreign exchange you will need to discuss with them on how to convert the shares to ADR shares before the transfer request is submitted.

    Regards,
    ?
    Stephen

    Well Phil what do you recomment one does? TIA