Weekly Update: October 27, 2016

| October 27, 2016

Weekly Update:  October 27, 2016

 

What To Watch

Most of the action in stocks over the past week have been in individual names, with the heart of earnings season underway.  This week has been focused on the major tech stocks, so lots of action in some of the biggest companies in the world.  Next week we’ll get earnings from some big retail names and Facebook (FB).

Stocks indexes have come down a bit since our last update, but are up modestly for the year.  The S&P 500 is up a bit under 6% for the year, while the Russell 2000 is up a little over 6%.  Small caps have been hit over the last week, when the Russell was up closer to 10%.  It could be a sign of less risk taking by investors.

The biggest commodity winner this year is still sugar, which is sitting at around 40% gains.  Precious metals are still doing well over all, with silver leading the way, up nearly 26%. Crude oil is up 6% on the year and has been pretty volatile this year.

Once again, the next big event is the FOMC meeting the first week in November.  We could get a good idea if rates will go up in December based on what the committee says.  Rates almost certainly won’t go up until December, at the earliest.

Let’s take a look at our positions.

 

Portfolio Recap

Position #1: JPMorgan Chase (JPM) November 67.5 Calls

Price Paid: $1.20

Time Until Expiration: 22 days

JPM climbs a bit each week, which is good news for us.  We’re just a few ticks away from our aggressive profit taking point.

 

Position #2: NVIDIA (NDVA) November 60 Puts

Price Paid: $1.42

Time Until Expiration: 22 days

NVDA spiked higher on news of the new Nintendo gaming system.  The stock breached both of our risk control exit points, so everyone should be out of the position.  If you cashed in on the down move the week prior, good move. Otherwise, holding the position made for a good hedge should the tech sector tumble.  Since we’re out of this position, we won’t be updating it further.

 

Position #3: Oracle (ORCL) November 38 Calls

Price Paid: $0.70

Time Until Expiration: 22 days

ORCL, our latest trade, has moved slightly higher since last week.  The stock looks like it’s making a run at $39, which is also our first exit point for profit taking.  Peak gains so far are 36%.

 

Category: OTW Weekly Updates