Money Talk Portfolio Review, 2021′s Outlook & Trade of the Year
by ilene - December 11th, 2020 2:57 am
Phil's trade of the year for 2021: Intel
Phil's Money Talk Portfolio is up 51% Year to Date!
- Read Phil's review of his Money Talk Portfolio here.
- Watch Phil and Kim Parlee discuss the Money Talk portfolio and Phil's trade of the year for 2021 on BNN Bloomberg:
Phil Davis, founder of philstockworld.com and managing partner at PSW Investments, recaps the performance of the MoneyTalk PSW portfolio and explains why tech giant Intel (INTC) is his trade of the year. (BNN Bloomberg)
Trade of the Year 2021: Intel (INTC)
I'd rather not pick another Tech as SWPR is technically tech but I have no choice but to recognize Intel (INTC) as the trade most likely to return 300% over the next two years AND be the least likely to take a loss. Those two factors, low risk and high reward, make INTC our 2021 Trade of the Year. After bottoming out at $45 on delays in their new chip sets, INTC has already recovered to $50 but that's only $205Bn and INTC makes $21Bn a year in Net Income for a P/E of less than 10.
The recent volatility has left the option premiums elevated so we can take advantage of that with the following trade idea for the Money Talk Portfolio:
- Sell 10 INTC 2023 $45 puts for $7.30 ($7,300)
- Buy 25 INTC 2023 $45 calls for $10.75 ($26,875)
- Sell 25 INTC 2023 $55 calls for $7.00 ($17,500)
That's net $2,075 on the $25,000 spread with $22,925 (1,105%) of upside potential at just $55. Ordinary margin on the short puts should be $3,059 but, even with IRA or 401K full margin, this is a very nice way to make $22,925 in two years as the downside risk on INTC is very limited. Their main rival, AMD, has just $7Bn in sales vs $72Bn for INTC, they are 1/10th the size and no significant threat.
With
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Trade of the Year Tuesday – Who Will Survive the Fall?
by phil - December 8th, 2020 7:30 am
This is a solemn duty.
We have not had a miss in a decade of our Trade of the Year picks and I'd hate to break that streak. I am currently considering that my trade of the year should be NO TRADE as I really don't trust the markets and I'd rather short Tesla (TSLA), which is often a suicide run but TSLA never stops going up and $650 is $608Bn in market cap - more than EVERY other car company COMBINED – so that stock has left logic and reason behind long, long ago.
And yes, just one week ago, they made this chart and TSLA was 20% lower than it is now. Since then it's gained a Volkswagen in value and that's clearly ridiculous but, when things are clearly ridiculous, what is to stop them from getting more so?
So, TSLA is too dangerous to short but, if I were to short it, I would buy the Jan 2023 $800 puts for $350 and I would sell the Jan 2022 $800 puts for $295, which would put me in the calendar spread for net $55 and I would pay for 10 of those $55,000 by selling 3 Jan 2022 $750 calls for $152.50 ($45,750) so we'd be in the spread for net $9,250 and our hopes there are that the short calls expire worthless and the short puts either expire worthless or can be rolled lower and whatever value is left on the long puts greater than $9,250 is our profit. We'll see how that goes next year.
In last year's Trade of the Year Report, we ended up picking Barrick Gold (GOLD) at $16.50 with a net $750 spread that would pay $12,000 if all went well for a $11,250 (1,500%) profit if GOLD were over $17 in Jan, 2022 (one of our famous "Stupid Options Tricks" we teach our Members. GOLD rocketed up to $30 in the summer and we took an early exit and now it's back to $23.95 and I'm almost ready to jump back in:
I don't see the Dollar getting too much stronger so Gold and GOLD should continue
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Phil Davis trade ideas: Barrick and Pfizer (10-7-20)
by ilene - November 19th, 2020 10:41 am
Phil Davis trade ideas: Barrick and Pfizer
Phil Davis looks back at how his trade idea for investing in Barrick (ABX) has played out over the past several months and lays out a new trading idea how investors can capitalize on pharmaceutical giant Pfizer (PFE).
Phil talks about ABX, gold, hedging against inflation, stocks, the Money Talk PSW portfolio, IBM and Macy's (both good for new trades), the kind of trades we like to be in using options, the stock market, and a new options trade for Pfizer (it's not too late!).
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Phil Davis trading ideas
by ilene - November 18th, 2020 12:03 pm
Phil Davis trading ideas (July 17, 2020)
Phil Davis, founder of philstockworld.com and PSW Investments looks at the performance of the MoneyTalk portfolio during the COVID-19 pandemic and shares a trading idea involving options for Tesla and Toyota.
(Originally published on July 17, 20)
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Money Talk Portfolio Update & Show (4-29-20)
by ilene - May 10th, 2020 8:17 pm
MoneyTalk Portfolio Update, April 29
The last time I was on the show was March 11th, a bit before we hit bottom and I made a call for jumping into blue chips and I made a call for selling puts on stocks you want to buy, using Valero (VLO) and Ford (F) as examples. We also added Tanger Factory Outlets (SKT) as a long-term dividend play. Our Money Talk Portfolio was down 8.4% at the time and we made a series of aggressive moves I detailed in that morning's PSW Report – in order to take advantage of the market decline.
We had the advantage of being mostly in CASH!!! In fact, we had $99,235 of cash in the portfolio while the positions themselves were worth -$7,670 for net $91,565 out of our original $100,000 we began with back on 11/13/19. We had stayed "Cashy and Cautious" – as we did with all of our Member Portfolios, as we felt fairly certain that SOMETHING was going to cause the market to sell off – we just didn't expect it to be a virus!
We used $14,540 of our sideline cash to make adjustments and another net $1,425 was spent on the three new positions (our core strategy at PSW is to sell premium, not to buy it). So far, so good as we're back to $101,825 as of yesterday's close but we're a little worried about two of our positions and we're going to add a couple as well:
- Ford (F) – They made it through the last crisis without a bailout so we think net $3.65 would be a great entry but, on the whole, we're very confident we'll collect the full $2,750 that is currently charged against us.
- Valero (VLO) – Another new addition and already nicely profitable. All VLO has to do is not be below $40 in Jan of 2022 and we make another $3,925 – aren't options fun? Our worst
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MoneyTalk Portfolio Update
by ilene - February 6th, 2020 10:59 am
Update:
See Phil on MoneyTalk Feb. 5, 2020, here.
Markets have seen some wild swings in recent weeks as investors worry about the potential economic impact of the Coronavirus. Phil Davis, founder of philstockworld.com and PSW Investments, shares some specific options strategies for a Chinese EFT, IMAX, the entertainment technology company and Freeport McMoran aimed to help investors take advantage of the volatility.
Money Talk Portfolio Update
Summary:
- We initiated a new Money Talk Portfolio last Quarter for Seeking Alpha.
- It's a no-touch portfolio between appearances on the Bloomberg Show.
- Below is an update and 2 new positions.
Up and up the markets go (again).
With 25,000 infected (up 7,500 (42.8%) from Monday) and 500 dead (up 140 (38.6%) from Monday) so far from the virus – that markets appear to now be completely ignoring – I'm kind of focused on the infections outside of China (which stands at 216 versus 183 on Monday). The good news this morning is China claims to be close to a treatment that seems to work for virus patients and we now have 988 people recovered – twice as many as have died so – progress!
As we also noted on Monday, Gilead (GILD) is making progress on a vaccine, as are others so we should be happy with the progress but now we're back to our original problem which is that stocks are just too darned expensive in the first place. The U.S. PEG Ratio (Price/Earning divided by Growth) has NEVER been higher than it is now and that means stocks have never been more expensive relative to their actual growth:
Of course, this is our job to look for stocks that are specifically good buys, like GILD
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Money Talk Portfolio at TheStreet.com: New Portfolio, New Trades!
by ilene - December 21st, 2019 7:59 pm
Money Talk Portfolio at TheStreet.com: New Portfolio, New Trades!
In case you missed Phil on Money Talk last month, watch video here.
[These trades were originally posted on 11-13-19]
We are featuring some of our Member Portfolios over at TheStreet.com starting with our Money Talk Portfolio, which kicks off this evening on BNN (Bloomberg Canada) at 7pm this evening. Through the end of this quarter, the Money Talk tab usually found on PSW will ALSO be found on TheStreet but, over time, they will get the exclusive on that and a couple of other portfolios as well as some PSW content (also a subscription).
We closed the old Money Talk Portfolio after two years with a 148.1% gain on Sept 18th as I didn't trust the upcoming quarter enough to risk the gains. Turned out I was premature in my worries (as I often am because I'm a worrier) but I'm still worried so we're going to start with a couple of conservative trade ideas and see how things go. The rule of the Money Talk Portfolio is we only do trades we announce on the show, once each quarter so it's a very low-touch portfolio using our options strategies to hedge the risk and lever our returns.
When closing down the MTP, I did make the following suggestion for a good use of our $124,042 of cash:
Our 2019 Stock of the Year is IBM (IBM) and our IBM position is already 100% in the money at net $2,707 out of a potential $7,500 so, if I were going to keep one trade active – that would be the one as all IBM has to do between now and January of 2021 is hold $135 and that spread will make another $4,793 (177%) so we could, for example, put $27,070 of our $124,043 in cash back to work on just the IBM trade and, if all goes well, it will turn into $75,000 – making almost 100% of our original total in just over a year – so why be more complicated than that?
There's still a lot of potential
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Wild Wednesday – Trade In Doubt, Impeachment Begins, Powell Testifies and We Take Money Talk to The Street!
by phil - November 13th, 2019 8:21 am
Where do I begin?
The Index Futures are down about 0.5% as Trump once again puts a Trade Deal into doubt. Europe and Asia are down more like 1% so we might be just getting started or Trump could send out one of those "I was joking" tweets after he threatened China with more tariffs yesterday. “In the short term the market’s been too optimistic. The best interpretation of the trade situation is that almost everything that can be tariffed has been tariffed,” said Christopher Mahon, director of asset allocation research at Barings.
How come when he says it on Nov 12th, he's quoted in the WSJ but when I've been saying it for two months – no one notices? I have to get a better publicist – or A publicist….
Speaking of which, I guess I will have a better publicist as we move some of our Member Portfolios over to TheStreet.com starting with our Money Talk Portfolio, which kicks off this evening on BNN (Bloomberg Canada) at 7pm this evening. Through the end of this quarter, the Money Talk tab usually found on PSW will ALSO be found on TheStreet but, over time, they will get the exclusive on that and a couple of other portfolios as well as some PSW content (also a subscription).
We closed the old Money Talk Portfolio after two years with a 148.1% gain on Sept 18th as I didn't trust the upcoming quarter enough to risk the gains. Turned out I was premature in my worries (as I often am because I'm a worrier) but I'm still worried so we're going to start with a couple of conservative trade ideas and see how things go. The rule of the Money Talk Portfolio is we only do trades we announce on the show, once each quarter so it's a very low-touch portfolio using our options strategies to hedge the risk and lever our returns.
When closing down the MTP, I did make the following suggestion for a good use of our $124,042 of cash:
Our 2019 Stock of the Year is IBM (IBM) and
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The PhilStockWorld.com Money Talk Portfolio Review – Sept 18, 2019
by phil - September 17th, 2019 10:14 pm
I'll be on BNN's (Bloomberg Canada) Money Talk tonight at 7pm.
The last time I was on the show was back in on April 24th and we only make changes to the Money Talk Portfolio live on the show so we decided to lock into a neutral position over the summer and that's just where we ended up, dropping to $124,043 from April's $127,663 so down $3,620 for the summer is about as neutral as we can get it and we're still up $74,043 (148%) from our $50,000 start just about 2 years ago on the button.
Since there's a lot of uncertainty going into Q4 and it has been just about 2 years – I think this is a good time to cash out this portfolio and we will begin a new portfolio with a new $50,000 around Thanksgiving – beginning with our still-undecided Stock of the Year.
Our 2019 Stock of the Year is IBM (IBM) and our IBM position is already 100% in the money at net $2,707 out of a potential $7,500 so, if I were going to keep one trade active – that would be the one as all IBM has to do between now and January of 2021 is hold $135 and that spread will make another $4,793 (177%) so we could, for example, put $27,070 of our $124,043 in cash back to work on just the IBM trade and, if all goes well, it will turn into $75,000 – making almost 100% of our original total in just over a year – so why be more complicated than that?
There's still a lot of potential in all these positions, as noted in the April review, the portfolio has the potential to hit over $200,000 by Jan 2020 but, as I noted, if we cash out now at $124,043 and make another $50,000 on the IBM trade – that's $174,000(ish) anyway but we'd have $100,000 in our pockets NOT at risk through the holidays – that is certainly a much wiser way to go – especially in a portfolio we are unable to adjust between shows.
So the decision is final, we're cashing out and endorsing our Stock of…
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The PhilStockWorld.com Money Talk Portfolio Review – Apr 24, 2019
by phil - April 24th, 2019 8:42 am
I'll be on BNN's (Bloomberg Canada) Money Talk tonight at 7pm.
As usual, we will be reviewing our Money Talk Portfolio, which we initiated back on Sept 6th, 2017 to track the trade ideas we would introduce, live on the show, about once each quarter. The idea of the portfolio was to select highly leveraged, high-probability trades that did not have to be adjusted very often (or at all) and, so far, it's been a tremendous success with our initial $50,000 turning into a lovely $127,663 (up 155.3%) at yesterday's close, about 18 months after we got started.
We recently reviewed the MTP back on Feb 15th and, at the time, the portfolio was at $88,922 with, of course, the exact same positions – as I hadn't been on the show since Jan. We did send out an alert (our first ever) to dump GE shortly after that – those alerts go out free of charge on Twitter, Facebook, Seeking Alpha, etc to make sure they were available to all so make sure you follow those feeds. Note that, for each position, we clearly define our expectations and, overall, we expected our positions to make another $76,638 at the time but we've already made another $38,741 (43%) – which is way too fast – so we have to be careful that some of our positions are overbought already.
That's right as FUNDAMENTAL VALUE INVESTORS we believe that stocks – even the ones we like – can be too expensive, as well as too cheap. When they are too cheap, we buy them – when they are too expensive, we sell them. It sounds logical but how many traders actually do it when the time comes?
Now, let's take a fresh look at what we have:
- Alaska Airlines (ALK) – Just a short put that nets us in for $51.80. We're not worried about it. Expect to gain the full $4,100 so $2,650 left to gain.
- Nasdaq Ultra-Short ETF (SQQQ) - A hedge we expect to lose on and so far, so good as we're down about $4,000 with just $450 in value left. Still, we do need
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Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...
Ilene is editor and affiliate program
coordinator for PSW.