Update: January 3, 2017

| January 3, 2017

January 3, 2017


Portfolio Update

Happy New Year everyone… and welcome to 2017!

Over the last few days, I’ve spent some time looking at the markets and trying to figure out where we’re going from here.  What are we seeing right now?  

We have a strong willed market that is pushing to new highs… and we’re seeing a number of “Wall Street” analysts coming out with downgrades today.  There’s a famous saying that the market climbs a “Wall of Worry”.  Well, these analysts are worried.

The truth of the situation is, the market could end tomorrow… or 5 years from now.

Yes the market has been running higher and it’s been quite impressive… but it doesn’t mean it has to pull back, today, tomorrow, or the next day.  So, we’re going to stick with the trend and play the themes that made us money at the end of the year.

I’m seeing a handful of macro trades that are working well right now… and I believe they’ll have traction well into the New Year.  

I’m seeing strength in Industrials, Finance (banks), Retail, Metals & Mining, and Energy!  Those are areas we’re going to focus on in the next few months.

DON’T FORGET – New Trades Next Monday!

Of course we’ll keep a sharp eye on the market… if it does turn, we want to take action… but for now, the trend is our friend.

Let’s look at the portfolio…


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.

  • Halliburton Company (HAL) January (20th) $50 Calls – This stock jumped again today and is trading near $55.  We’re already through the top end of our exit points… If you’re still holding this option, watch it closely and don’t be afraid to take profits quickly!  Peak profits are 323%!  
  • Valero Energy Corporation (VLO) January (20th) $62.50 Calls – The rebound in oil prices is holding strong… and Valero is benefiting from the move.  The stock is trading over $70 right now.  That pushes our options up in value to over $7 each – a gain of over 471%! We’re already through both exit points on the upside, so watch these closely and don’t be shy about taking profits!
  • Citigroup Inc. (C) January (20th) $55 Calls – When we put this trade on, the stock was well below $55, and today we’re trading over $60 a share!  It’s another stock that blew through the upper levels of our exits… and profits are climbing.  As of right now, the option is worth $6.10… or a 291% gain.  Again, don’t be afraid to take profits on this trade!
  • PHM, TOL, DHI – The homebuilders haven’t rallied into the new year like I expected.  I’d still sit tight for another week and see if we can’t get a new year rally in the industry.  However, if we don’t see some movement soon, we’ll need to take our money off the table.
  • Iconix Brand Group, Inc. (ICON) February (17th) $10 Puts – We’re up 44% on this trade… hold tight for more.
  • Summit Materials, Inc. (SUM) February (17th) $25 Calls – At the end of the year, we had a nice move in the stock which gave the option a nice gain of 350%.  Not bad for a small move in the stock.  Start taking money off the table on this one!
  • Argan, Inc. (AGX) January (20th) $75 Calls – Another good run in stock prices at the end of the year gave us a nice gain.  The option’s peak value so far has been 120%.  Since this option expires soon, don’t be afraid to take cash off the table.


Category: AOA Updates