Posts Tagged ‘PGF’

$112,291 Virtual Portfolio Update, Week 16

Next week will be the last week for our very profitable virtual portfolio, that started with $100,000 on April 10th.

This virtual portfolio has already made 19% in 16 weeks and many members wanted to start a new one from scratch.  So, by popular demand, we will be restarting a brand new virtual portfolio the week after options expiration, also with $100,000 and also a hedged virtual portfolio but this time with the goal of drawing a monthly income.  I got this idea when I went down to Florida last week and spoke to many people who asked me about their investing accounts.  Many of these "safe" accounts had been cut in half or worse and the returns they were producing were coming in at 5% year – if that and people were counting on this money for their monthly expenses.  I spoke to many people with $1M in the bank who were living off $50,000 a year in interest and dividends!

Using options and good hedging strategies, we have been able to produce a return in our virtual portfolio of 19% in just 16 weeks (12% cash, 7% unrealized).  I'm not advocating someone take a whole $1M and shift it to stocks and options but, if you can make 20% on $200,000 while your other $800,000 makes a "safe" 5%, your annual income goes from $50,000 to $80,000 – that's a lot of early-bird specials!  I will, of course, be happy to answer any adjustment questions on this virtual portfolio anytime during chat but we will no longer be tracking it weekly or making new plays.  The goals of the new virtual portfolio will be similar and the new trade ideas can be applied whether you are looking to draw an income or just start building long-term set of holdings for reinvestment.

In the last $112,007 Virtual Portfolio Update, from July 28th, we remained bullish and it really paid off with another $2,117 in unrealized gains ($6,690 not included in above total) as we made a very well-timed bottom call the week before and ran with it.  We have haven't had to call an "audible" in two weeks, sticking to our plan as the market held up nicely.     

The first few weeks after you sell options are usually the worst and the rising VIX had boosted the premiums of the puts and calls we sold but none of that matters because we played a…
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Weekend Wrap-Up, Ripping Through the Top or Topping and About to Tip?

What a week this has been!

In last week's 600-Point Weekly Wrap-UP, I said it would take some spectacular earnings results next week to keep the rally going and it seems like we got them this week as roughly 85% of the companies reporting this week beat expectations with 42 of this week's reporting companies guiding up and only 18 guiding down.  While people like Richard Bernstein may make very good arguments for why we shouldn't focus too much on quarterly earnings surprises, I have to say I am somewhat swayed by the preponderance of evidence we've gotten this week that, by and large, the vast majority of our companies are weathering the storm far better than analysts have expected.  

"It's pretty amazing what passes for good news these days," remarks Barry Ritholtz on his blog, The Big Picture (www.ritholtz.com.) "Beating dramatically lowered earnings forecasts on cost-cutting and layoffs — rather than top-line growth — seems to be the order of the day.  The irony is that the Wall Street analyst community overestimated earnings at the top of the cycle — pure extrapolation of trend to infinity. They seem to be doing the same thing now, only extrapolating falling earnings to zero. What that produces is not true upside surprises, but merely jumping over a dramatically lowered bar," he says. 

It's interesting Barry says this now because it sounded familiar and I went back to my May 2nd Weekly Wrap-Up, where the sentiment was very similar and I said at the time: "With 2/3 of the S&P 500 weighing in, earnings have been 70% positive.  I had warned earlier in the week that we are only beating a very low bar but we are beating nonetheless.  As you can see from the above chart, even if we do keep moving up, we are heading into some very serious overhead resistance that may not prove futile this time.  With the added pressure of the old "sell in May, go away" adage – there will be a lot of obstacles to overcome this week and next so we will remain on guard but we have also trained ourselves not to think and simply go with the flow, letting our levels guide us and, so far, our levels keep saying yes – despite our common sense
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$100,000 Hedged Portflio Update

We didn't do a wrap-up last week as I instead wrote a long, Members Only post (only Part 1 too) on "Setting Up A $100,000 Hedged Virtual Portfolio" concentrating on a virtual $20,000 allocation in the financials for our first sector.

We're going to do more of these on the weekends as people find them useful and also because, although they are very popular, I do get tired of just reviewing what we did for the past 5 trading days every week.  So maybe a little of both today but I aim to keep this short (as I usually do, but it never works out) so we can do another post on earnings plays tomorrow.

How is our new sample virtual portfolio looking after a week?  Well let's see

  • 500 UYG at $3.48, selling 5 May $3 calls for .72 and 5 May $3 puts for .28, net $2.48/2.74

    • UYG now $3.79, May put and call combo now $1.12 = net $2.67 ($95 profit on $1,240 = 7.7%)
  • Selling 2 FAS $7.50 puts for .45 naked

    • FAS closed at $9.40 so 100% profit of $90
  • 500 C at $3.04, selling May $3 puts and calls for $1.11, net $1.93/2.47

    • C now $3.65, May $3 put and call combo is $1.19 = net $2.46 ($265 profit on $965 = 27.5%)
  • Selling 2 IYF May $36 puts for $2 naked

    • IYF closed at $40.26, May $36 puts $1.20 ($160 profit on $400 =40%)
  • Selling 2 JPM May $29 puts for $1.95 naked

    • JPM closed at $33.26, May $29 puts $1.17 ($156 profit on $390 = 40%)
  • Selling 7 FAZ May $10 puts for $2.40 naked (adjusted to reflect Monday's gap down open)

    • May $10 puts are now $2.67 so a loss of $189 (-11.3%).  Both our July and Oct escape rolls are still intact so no worries here anyway (this is a hedge to the others)
  • 5 FAZ Oct $12.50 calls for $4 (adjusted), selling 5 May $21s for $1.05, net $2.95.

    • The Oct $12.50s are now $3.29, May $21s are now .45 so net $2.85, a loss of $50 (3.4%)

So far so good!  The FAZ hedges are holding up nicely while all of our upside plays were winners. …
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Phil's Favorites

How Netflix affects what we watch and who we are - and it's not just the algorithm

 

How Netflix affects what we watch and who we are – and it’s not just the algorithm

pixinoo / Shutterstock

Courtesy of David Beer, University of York

Netflix’s dystopian Korean drama Squid Game has become the streaming platform’s biggest-ever series launch, with 111 million viewers watching at least two minutes of an episode.

Out of the thousands of programmes available on Netflix globally, how did so ...



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Zero Hedge

Where Are We In The Market Cycle?

Courtesy of Jesse Felder, TheFelderReport.com

(The following blog post was adapted from a recent Market Comment featured on The Felder Report PREMIUM, as published at ZeroHedge)

Lately, I’ve started to notice many signs suggesting we are now well past the peak in risk appetites. To begin with, Citi’s panic/euphoria model, developed by Tobias Levkovich (and renamed in his honor after he sadly passed away last weekend), is a terrific visual representation of this phenomenon. In the early part of this year, it soared to ...



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Politics

Steve Bannon faces criminal charges over Jan. 6 panel snub, setting up a showdown over executive privilege

 

Steve Bannon faces criminal charges over Jan. 6 panel snub, setting up a showdown over executive privilege

Defiant or following Trump’s direction? John Lamparski/NurPhoto via Getty Images

Courtesy of Kirsten Carlson, Wayne State University

The House committee investigating the Jan. 6 attack on the U.S. Capitol is tasked with providing as full an account as possible of the attempted insurrection. But there is a problem: Not everyone is cooperating.

As of Oct. 14, 2021, Steve Bannon, a one-tim...



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Biotech/COVID-19

Ivermectin is a Nobel Prize-winning wonder drug - but not for COVID-19

 

Ivermectin is a Nobel Prize-winning wonder drug – but not for COVID-19

While ivermectin was originally used to treat river blindness, it has also been repurposed to treat other human parasitic infections. ISSOUF SANOGO/AFP via Getty Images

Courtesy of Jeffrey R. Aeschlimann, University of Connecticut

Ivermectin is an over 30-year-old wonder drug that treats life- and sight-threatening parasitic infections. Its lasting influence on global health has been so profound...



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Digital Currencies

Is This the Way?

 

Is This the Way?

Courtesy of 

A listener asked something that’s on a lot of investors’ minds? Should I be taking way more risk?

I’m 34 y/o and a couple of years ago a friend of mine took enormous financial risk, betting his life savings on obscure crypto coins (Elrond and Fantom). The bet paid off and he has managed to turn $30k into $6 million. Can you please help me make sense of this? I have always considered myself to be financially responsible, saving a large percentage every month for retirement.

I’m concerned I’m being too responsible and need to incorporate more risk into my portfolio. My Roth IRA/403(b) is...



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Chart School

Gold getting ready to move

Courtesy of Read the Ticker

By Xmas 2021 the DEM's must set a foundation for their run in US Mid Terms late in 2022. The DEM's have a few narrative problems, but one they wish to avoid is a 'stock market crash'. They must produce enough juice for the economy to hold up into the mid term elections.

In short it is more debt, a  higher debt ceiling, and more debt for the FED to buy, a larger balance sheet for the FED. This means hard currency remains in a uptrend and higher prices will be soon upon us.





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Promotions

Phil's Interview on Options Trading with TD Bank

TD Bank's host Bryan Rogers interviewed Phil on June 10 as part of TD's Options Education Month. If you missed the program, be sure to watch the video below. It should be required viewing for anyone trading or thinking about trading using options. 

Watch here:

TD's webinar with Phil (link) or right here at PSW

Screenshots of TD's slides illustrating Phil's examples:

 

 

&n...



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Kimble Charting Solutions

Crude Oil Cleared For Blast Off On This Dual Breakout?

Courtesy of Chris Kimble

Is Crude Oil about to blast off and hit much higher prices? It might be worth being aware of what could be taking place this month in this important commodity!

Crude Oil has created lower highs over the past 13-years, since peaking back in 2008, along line (1).

It created a “Double Top at (2), then it proceeded to decline more than 60% in four months.

The countertrend rally in Crude Oil has it attempting to break above its 13-year falling resistance as well as its double top at (3).

A successful breakout at (3) would suggest Crude Oil is about to mo...



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ValueWalk

Managing Investments As A Charity Or Nonprofit

By Anna Peel. Originally published at ValueWalk.

Maintaining financial viability is a constant challenge for charities and nonprofit organizations.

Q4 2020 hedge fund letters, conferences and more

The past year has underscored that challenge. The pandemic has not just affected investment returns – it’s also had serious implications for charitable activities and the ability to fundraise. For some organizations, it’s even raised doubts about whether they can continue to operate.

Finding ways to generate long-term, sustainable returns for ...



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Mapping The Market

Suez Canal: Critical Waterway Comes to a Halt

 

Suez Canal: Critical Waterway Comes to a Halt

Courtesy of Marcus Lu, Visual Capitalist

The Suez Canal: A Critical Waterway Comes to a Halt

On March 23, 2021, a massive ship named Ever Given became lodged in the Suez Canal, completely blocking traffic in both directions. According to the Suez Canal Authority, the 1,312 foot long (400 m) container ship ran aground during a sandstorm that caused low visibility, impacting the ship’s navigation. The vessel is owned by Taiwanese shipping firm, Evergreen Marine.

With over 2...



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The Technical Traders

Adaptive Fibonacci Price Modeling System Suggests Market Peak May Be Near

Courtesy of Technical Traders

Our Adaptive Fibonacci Price Modeling system is suggesting a moderate price peak may be already setting up in the NASDAQ while the Dow Jones, S&P500, and Transportation Index continue to rally beyond the projected Fibonacci Price Expansion Levels.  This indicates that capital may be shifting away from the already lofty Technology sector and into Basic Materials, Financials, Energy, Consumer Staples, Utilities, as well as other sectors.

This type of a structural market shift indicates a move away from speculation and towards Blue Chip returns. It suggests traders and investors are expecting the US consumer to come back strong (or at least hold up the market at...



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Lee's Free Thinking

Texas, Florida, Arizona, Georgia - The Branch COVIDIANS Are Still Burning Down the House

 

Texas, Florida, Arizona, Georgia – The Branch COVIDIANS Are Still Burning Down the House

Courtesy of Lee Adler, WallStreetExaminer 

The numbers of new cases in some of the hardest hit COVID19 states have started to plateau, or even decline, over the past few days. A few pundits have noted it and concluded that it was a hopeful sign. 

Is it real or is something else going on? Like a restriction in the numbers of tests, or simply the inability to test enough, or are some people simply giving up on getting tested? Because as we all know from our dear leader, the less testing, the less...



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Insider Scoop

Economic Data Scheduled For Friday

Courtesy of Benzinga

  • Data on nonfarm payrolls and unemployment rate for March will be released at 8:30 a.m. ET.
  • US Services Purchasing Managers' Index for March is scheduled for release at 9:45 a.m. ET.
  • The ISM's non-manufacturing index for March will be released at 10:00 a.m. ET.
  • The Baker Hughes North American rig count report for the latest week is scheduled for release at 1:00 p.m. ET.
...

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About Phil:

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...

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Ilene is editor and affiliate program coordinator for PSW. Contact Ilene to learn about our affiliate and content sharing programs.