Hey once again!
We did a GLD trade again, but this time it was a directional. Our trading system is designed to work very well within a moderate range of volatility. Last week and most of this week was well without that range of volatility. Then Thursday we got a great opportunity. With the decline on the Dow after the Bernacke speech Gold took a great nose dive and we were able to use our knowledge gained when we got creamed a few months ago to make a little money. We will go through this below.
Eldest daughter just finished her first year in the USAF. So far she is doing well and loving what she does.
ANALYSIS
Here is the trade we had on last week:
GLD 122.50 Put Bought at .37
GLD 122.50 Put Sold at .64 This gave a net ROI of 72.9%
If we could have gotten any premium at all this would have a great chart for a call spread trade. The trend line was down all week. The price never got above the 200 Day SMA and only approached the 50 Day SMA on Friday. Unfortunately there was really no premium out there this week. This is why when we say the huge drop of almost 200 points in the Dow in the premarket I set up the directional GLD trade. In the Thursday pre-market the price dropped over $5,00 and the total drop ws just over $7. but the drop after the market opened gave us enough price increase in the put options (remember when underlying price goes down - put option prices go up) to make us a good deal of money. The last time we had a two day drop of over 300 points I was decimated on a trade. So this time I planned to make some money on it.
This was considered a day trade by my broker because I entered it early on the morning just after the market open and closed it out right before the close. When doing directional trades in the weekly options it is very difficult to hold these, especially when you enter them on a Thursday!
PAPER TRADE
There are no paper trades on at this time.
COVERED CALLS
We still have our covered calls on Vivus and CBI again.
Symbol Company Stock Option Premium Initial Annualized
VVUS Vivus 13.84 June14 .16 2,676.00 4.18%
CBI Chicago Bridge 59.17 June70 .45 5,409.00 5.82%
These are the completed covered call trades this year:
Symbol Month Premium Month Ann Month Cum Prem Cum An ROI
ROI ROI
VVUS January $32 1.19% 14.35% $32 14.35%
VVUS February $63 2.35% 25.25% $95 21.30%
VVUS March $28 1.05% 12.56% $123 13.79%
VVUS April $29 1.08% 13.00% $152 17.04%
VVUS May $44 1.64% 11.51% $196 14.64%
VVUS June $16 0.597% 7.17% $212 15.84%
CBI January $50 1.12% 13.39%
CBI March $ 125 2.31% 27.73% $175 12.94%
CBI April $230 4.05% 48.67% $405 7.14%
CBI June $45 0.831% 9.98% $450 8.42%
VVUS – This stock has broken out of the $10-$12 range for now. It has moved up to the $13-$14 range and pushing $15. We narrowly escaped getting called away here and will just keep plugging away getting more and more premium.
CBI – We are in a good zone for this one. Again we narrowly escaped getting called away. My outlook on CBI is much better than VVUS. There was a dip when the market dropped a enough this week to keep us in the game. With this one if we had been called away we would have made even a little more, but we don’t have to worry about that now! We will put on another CBI covered call as soon as we get good premium. This is the cumulative covered call results for 2013:
Symbol Invested $ Option Prem Call Away Div Total Return
VVUS $2,676.00 $ 212 $212 7.92%
CBI $4,480.00 $ 50 $320 $370 8.26%
CBI $5,409.00 $400 $ 91 $5.00 $496 9.17%
Totals $12.925.00 $662 $411 $5.00 $1,078 8.34%
DIVIDEND STOCKS
Here are the two portfolios updated.
This portfolio is an income portfolio made up of 100 shares of each stock. These stocks are some blue chips, some Business Development Companies (BDCs), Closed End Funds (CEFs) and some small caps that look like they will grow. Some of these I have talked about before, some not. I will give a brief note on each of them in the coming weeks:
Ticker Name Buy Current Div Pay Div
Price Price Date Yield
PSEC Prospect Capital 10.68 10.52 06/29/2013 11.96%
AGD Alpine Global Dynamic 4.84 4.57 06/29/2013 7.43%
TCPC TCP Capital 15.28 16.08 06/29/2013 8.99%
MO Altria 34.26 34.93 07/10/2013 5.17%
T ATT 37.34 34.47 08/01/2013 4.82%
ARCP Am. Realty Capital 16.69 14.45 09/15/2013 5.37%
GLAD Gladstone Capital 8.98 8.05 06/31/2013 9.35%
STI Sun Trust Bank 29.37 31.23 09/14/2013 1.36%
WFC Wells Fargo 37.74 40.96 09/01/2013 3.18%
KKR KKR & Co Units 20.77 18.70 08/21/2013 6.39%
Buy Price Portfolio Value = $21,595.00
Current Price Portfolio Value = $21,455.48
Gain/(Loss) So Far = -$139.52
Portfolio Return = -0.65%
Dividends Received So Far = $103.03
Portfolio Return w/ Dividends = -0.17%
Current Prices as of 06/22/2013 Closing Price
We keep our dividend moat portfolio. I have made the new portfolio as a way to show that a good return can come from another type of dividend model besides the moat philosophy. All the new equities are well rated in their business area and are quite strong companies. The financials look great so the dividend payout is relatively safe. Also many of the new equities must pay out most of their earnings to keep their tax status. slow and steady climb with this portfolio. This past week many of the stocks in the portfolio paid the quarterly dividend. Total return is now over 8% with the portfolio portion at almost 7%. This is great! This portfolio is showing my primary philosophy with stocks – buy great companies on sale and then let them ride.
Here is how Portfolio #2 shakes out:
Ticker Name Buy Current Div. Pay
Price Price Date Shares
KO Coke 36.89 39.76 07/01/2013 136.854
AGD Alpine Global Dynamic 5.76 4.57 06/29/2013 982.153
AOD Alpine Total Dynamic 4.37 3.91 06/29/2013 1,257.549
MO Altria 34.26 34.93 07/10/2013 150.766
INTC Intel 22.87 24.20 09/01/2013 240.000
HIX Western Asset Hi Inc II 10.53 8.85 06/22/2013 527.137
MCD McDonald’s 91.74 97.23 06/15/2013 55.425
MSFT Microsoft 28.55 33.27 06/13/2013 183.492
JNJ Johnson and Johnson 68.03 83.20 06/12/2013 71.547
PG Proctor and Gamble 68.72 77.43 08/15/2013 73.080
Buy Price Portfolio Value = $51,996.01
Current Price Portfolio Value = $53,961.51
Gain/(Loss) So Far = $1,965.50
Dividends Received So Far = $833.79
Dividend ROI = 1.60%
Stock Return = 2.18%
Total Return = 3.78%
Here is the watch list. Our three keys make getting on the list and then getting into the portfolio rather difficult. Here are the three keys: (1) a moat business model, (2) dividend of at least 3%, (3) solid fundamental analysis numbers.
Ticker Recent Date Div Target
Name Price Yield Price
COP ConocoPhillips 60.36 4.53% 58.00
BAC Bank of America 12.69 0.35% 11.00
BRKB Berkshire Hath B 112.38 No Div Pd 100.00
ConocoPhillips – This stock has great potential as the move significantly higher as the recent earnings was good and it has beat the street consistently.
Bank of America –This stock is keeping up a pattern of growing revenues and earnings after nearly collapsing in the banking crisis. This is a stock that I wish I had gotten into at this time last year at around $4.00
Berkshire Hathaway B Class – This is the way more affordable way to get into Berkshire Hathaway and Warren Buffett than the $150K+ regular Class A shares. Over any period of time 2years or greater an investment in Berkshire has made money. This past year (2012) the S&P beat Berkshire, only the 5th time that has happened in the history of Berkshire – over 40 years. So this is one that is purely price appreciation. DISCLOSURE – I own this in my personal stock portfolio –one of the few stocks I do own.
So far we are using the week’s downtrend to get closer to our target prices. Overall we are doing well with the two portfolios and I am very pleased.
QUESTIONS
All charts from freestockcharts.com. This is not a paid endorsement. They are a good free app that only asks for credit on their charts when you use them.
DISCLAIMER: Hashley Capital Management, LLC; as well as I are not giving any trading advice. All data is historical in nature and is intended for use as an educational tool. Trading in stocks and/or options is risky and can result in loss of capital. Stocks and options carry inherent risks and should be well researched before any buy/sell decision is made. There is no attempt to sell any brokerage services or act as a broker or dealer by Hashley Capital Management, LLC. Any forward looking comments on this blog are not attempts to solicit business for Hashley Capital Management, LLC and are the opinion of Hashley Capital Management only. If you choose to follow the same path and invest in the strategies and trades used by Hashley Capital Management, LLC after doing your own due diligence, that is your decision and yours alone.
Reach me @:
Twitter: @awagel01
Stocktwits: awagel01
Or leave a comment on the blog
TTFN
Ash
No comments:
Post a Comment