Update: April 20, 2015

April 20, 2015

 

Portfolio Update

While US stocks continue to trade sideways, there’s been a bit more action the last couple days.  Over the last month, the S&P 500 is up a little over a half a percent, and 2.5% on the year so far.  Meanwhile, small caps (as measured by the Russell 2000) are up over 5% on the year.

It could be that investors are searching for value due to the sideways trade.  Or, perhaps risk appetite among investors is a bit higher with volatility back to roughly bull market lows.

Earnings season hasn’t provided much in the way of market-moving action.  However, this week is when many of the biggest players start releasing results.  So far, the most meaningful news has come from banks, which appear to be doing better than expected.

Regarding economics news, recent reports have been underwhelming.  Jobs numbers are still strong, but everything else has been kind of blah.  It just gives further fuel for the Fed to keep rates low for the time being.  We’re still looking at September or beyond for the first rate hike.

We finally had some solid action in our portfolio.  There are some big winners and a couple losers, so make sure you take a look at all your positions.

Now, let’s take a look at some portfolio highlights…

 

Portfolio Highlights

Just a quick note:  We won’t update every open position every update.  I try to focus on the positions that have some significant news or price movement.

• Travelzoo (TZOO) June 10 Calls – It didn’t happen right away, but TZOO finally made the leap we’ve been waiting for. The stock surged after better than expected earnings, and gained as much as 289%.  Conservative traders should have exited, and we’re closing in on the aggressive exit level.

 

• Walmart (WMT) June 82.5 Puts – We’ve had these WMT puts since January and they’re finally paying off. That’s the benefit to spending a little extra on buying farther out options.  The stock breached our conservative exit point, and is approaching the aggressive exit level.  Max gains on the position so far are 122%.

 

• Under Armour (UA) May 75 Puts – I misjudged the cult following UA has, and it hurt this trade. Traders took UA much higher despite earnings not being released yet.  Sometimes you can’t account for the crowd.  Both conservative and aggressive traders should be out of the trade by now.

 

Category: AOA Updates