Update: April 28, 2014

| April 28, 2014

April 28, 2014


Portfolio Update

It’s funny, the last two weeks have been much like the previous two-week period, except with earnings thrown in.  The Nasdaq keeps threatening to break support and head towards the 200-day moving average – but buyers keep stepping in before it actually happens.

In the meantime, the S&P 500 is holding around its 50-day moving average.  Investors are not necessarily dumping stocks – instead they’re focusing on safer, more proven companies.  Gold and bonds also seem to be doing well, another signal of the growing safe-haven investor crowd.

The main global macro concern is still the conflict between Ukraine and Russia.  Armed conflict is occurring in small batches and some fear more significant military action is on the way.  Sanction from the US and EU may not be enough to prevent a more volatile situation from unfolding.

On the flip side, the US economy is looking better and better while corporate earnings have been mixed.  The most impressive earnings so far have come from Apple (AAPL) and Facebook (FB).  Investors have been less impressed with Google (GOOGL), Amazon (AMZN), and IBM (IBM).

The Internet selloff seems to be experiencing a new wave. It remains to be seen where the bottom will fall.  We’ll likely look into some safer companies next week in case tech companies continue to take it on the chin.

Let’s look at some of our positions.


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.

  • Salesforce.com (CRM) May $55 Puts – One area where the Internet selloff has been very helpful to us is with our CRM puts.  The stock has plunged, and our puts just traded as high as $6.90, good for a 188% gain.  The share price has dropped below our exit points for both conservative and aggressive traders, so we can close the book on this position.


  • Procter & Gamble (PG) June $80 Calls – One of the reasons we chose PG was to offset a possible tech/Internet selloff.  Investors look for long-term quality in a flight to safety, which is exactly what we’re seeing lately.  As such, PG stock has spiked and conservative traders can close this trade.  The recent high on our calls is for 106% gains.  Aggressive traders can hold the calls for bigger gains.


  • FireEye (FEYE) May $65 Calls – On the other hand, the Internet selloff hurt our FEYE position.  We recently added some tech stocks to our portfolio that I felt were oversold.  And, the share price did spike after we bought in, with our calls up 61% at one point.  However, we’ve had another wave of tech selling and this stock got hit hard.  Both conservative and aggressive traders should now be out of this trade on the recent pullback.


Category: AOA Updates