You owe it to your trading/investment account if not anything else

Well, this week President Trump dropped another potential surprise on the world with his ban on citizens from 7 countries which have global markets on risk-off mode today with most Asian markets lower, EC markets also lower and our futures indicating a red open as well.

To recap, Trump has signed the repeal of Obamacare, tore up NAFTA and TPP, signed a bill to build the wall, now banned people from entering our shores, and so what's left for him to do? Start trade wars and on the positive side lower corporate taxes, and allow for repatriation of overseas money for US corporates. One major negative left and two major positives. Timing is the key there though. Until last week I was under the impression/hope that maybe Trump would see better of going after every single thing he talked about in his campaign bluster. Now it seems just in a week he has come through on the worst of his promises. On the flip side, it means now maybe, he could come up with some positives like the lowering taxes and repatriation.

As far as our performance in the week goes, we had terrific week going from a negative return 4% YTD as of last weekend to a positive 21% as of this past weekend and for 2017. The account I have set up for the site has a current liquidation value of $324,506 as of Friday closing prices. Not bad considering the account was funded with $100,000 on Feb 1, 2016, no?

Tech is still not completely back or at least not convincingly enough. We had the "miss" from Google otherwise our week would have been even better. I am still not pleased with my overall performance and I expect going forward there remains a lot more work to be done. The year has started out as volatile as the last many years have been and like I have said, making money in this environment is tough. However, this is why we are all here. "Together we will all get there, where there is for each of us." 

Our basket of Chinese stocks are not acting very well with the Trump threat overhanging heavy on those names however I still expect 2017 will be the year of Chinese stocks to come flying through. I will have to, maybe, make a few moves in the names that we own in that basket. Extending expirations being one of them and/or equity positions as well. I am aware that I will have to clear some room in the portfolio if I were to add equity shares.

Last week, I added equity shares in Google/Alphabet and Amazon although I might make a few moves in those two positions this week. WE also sold some options positions, in GOOGL, AMZN, FB and MU last week while adding/opening options in further dated expirations/strikes in all four. This week will bring us to the meat and potatoes of techland earnings with Amazon on Thursday, FB on Wednesday and Apple reporting tomorrow (Tuesday) amongst a slew of others. 

For your reading pleasure (if you like that is).

Our futures are down this morning as most Asian markets were lower as our EC markets as investors globally seem to be in risk-off mode (at least this morning) as they mull over the ban from President Trump.

Weekly Update 22 Jan

We are back to tech apathy again, if not outright tech avoidance as our new President continues to threaten a trade war outright all over the globe. On the flip side, he has said nothing about the new administrations plans for fiscal policy and spending going forward. His favorite targets remain China, Mexico, and Japan and in almost every soundbite regarding trade, those countries are mentioned. I continue to believe that he is continuing with his campaign rhetoric however given the wild-card that he is, an element of uncertainty has crept back in the markets globally. It could be time for some positive news regarding his policies this week. 

Please also keep in mind that everyone wants the markets to fall and both the under-invested bulls and the dark-side (obviously) are all at their vocal and strident loudest at the moment. Both sides are desperately trying to talk things lower and using every half-truth if not outright lie to do so. Be careful out there.

Our account has slipped into the negative (-4%) for the year and I am not a happy camper to say the least. There is a lot of shouting by the gurus and swamis on the boob tube about Trump trade reversals and all that noise, however techland did not benefit in from any rally since Trump won the elections in the first place. However, there is no doubt that if the POTUS were to get into a trade war with China a lot of our positions in techland would be hurt significantly and not just the Chinese stocks we have direct exposure to but also the likes of Apple, the semis, and pretty much every other company out there that has manufacturing operations in Asia. Again, I don't think he is stupid enough to get into a trade war and this is all rhetoric tin order to bring these countries to the negotiating table with the Trump team seizing the early advantage. At least, thats what it looks like from a reasonable point of view.

We have a few of our account positions reporting earnings this week starting with Alibaba tomorrow morning (Tuesday) before the opening bell, and Google after the close on Thursday. I expect outstanding numbers from both the companies ala Netflix however the reaction to the earnings is not clear at the moment. Alibaba has a massive short position at the moment (110 million shares or so) which could lead to a nice squeeze and take it past the $4.70 or so move indicated currently. (See my article on Google was a flatliner all of last year (up 2% in 2016 at best) and I expect the management, especially CFO Ruth Porat, is well aware of the relative underperformance and will not let it happen again this year. 

Weekly Update 15 Jan

We finished last week up 1% and are now up 12% for 2017. I am not too pleased but given the volatility and given the fact that we operate in techland only which has seen continued higher volatility than most other sectors, I will take it. Just the nature of the beast. Of course, a major reason for not having a better week is the fact that Amazon did not announce an earnings date last week which led to options specialists in Amazon sucking a lot of ER volatility out of the January 27 strikes and adding it to the following week. An ER date announcement will more than likely come from Amazon tomorrow itself but it is what it is. 

No woulda, shoulda, coulda allowed. 

The account I have set up for the site is under no tech-only mandate/restrictions that I have for the fund or the IMA (individually managed account) part of my firm. So, if the opportunity presents itself, other sectors are open to establish positions in and around. I leave that up to you. I would love to hear your thoughts on that, so please take the 30 seconds or so it will take to respond back with your yea or nay.

Last week, we opened new positions in Google, Skyworks,, Micron and NetEase. We took partial profits on our FaceBook 125 calls with a sale at $7.07 (average cost of entry was $1.51) and we entered a new position in FaceBook with a strike of $135.

 Our new FB strikes and our existing position in the 125's are all free rides. All the Facebook options have been already paid for with our 125 strikes sales. Not bad, no? 

Finally, we added to our position in Alibaba calls.

Global markets are open today and Asian markets mostly closed lower on the day with the Nikkei lower by 1%, the Shanghai Comp was off 0.3%, Hang Seng lower by 1% as well and the Sensex was the lone market in the green with a tiny gain of 0.2%. Anxiety in the region seems to be picking up on the Brexit speech by PM May tomorrow and PEOTUS Trump's inauguration looming large as well as worries about what he might say/tweet regarding China, Japan and just about anything that pops into his head are a constant overhang. LOL

Across the pond, the CAC is lower by is lower by 0.6%, the Dax is down 0.5% and the FTSE is flat as a pancake.

Here are a few links to my articles over the weekend on Forbes and for those of you that want to read up ahead of the opening bell tomorrow.

My Cowboys lost yesterday but fought tooth and nail to the finish. A couple of plays and we could have pulled out a win and headed to the Championship game next weekend. All in all, a great season given what the experts were predicting once Tony Romo went down in the offseason. I, for one, cannot wait for the 2017 season to begin. 

I am pleased that we finished the 11 months ended Dec 31, 2016 up 168.4% ($100k to $268.4k in 11 months), especially, given how the year began for us and the rest of the world thanks to the monumental stupidity of our Federal Reserve raising rates going into 2016, the massive beat down due to Brexit (lasted 3 days only but that can be a lifetime in the options world) and then the Trump tech meltdown.

However, all of that is behind us and we start 2017 fresh and chomping at the bit.

We are already up 11% in the first week of 2017 thanks to a stellar week in techland and it is a nice way to begin the year but there remains a lot of trading ahead for the year.

I expect next week as we kick off earnings season, things will really begin to heat up for the markets overall. The strong greenback could pose some risks to earnings of those companies that have a strong overseas presence so monitoring our positions will be key going into the ER season.

We are also sitting on a lot of cash in the account and I plan on making some equity (stock) investments next week against which I will resuming selling calls as I see the opportunity going forward.

I am going to keep this short and sweet for now as I need to go res up first and then hang out and watch some football.

Going forward i also plan to resume sending out weekly updates/thoughts/commentary and I apologize for being remiss in that duty towards the end of the year in 2016. Just had a lot of my plate personally and professionally. No excuses at all, just what it was.

Please feel free to write as often as you need to and also I would love to see each and everyone of you in our little room as often as your time and schedules permit.

I wish you and yours all the success in the world in 2017 and beyond.

Over the weekend I got a few emails from a few of you (both subs and those taking trials) talking about protective hedges. Now just think about how those hedges would have performed this morning after news broke over the weekend that the FBI had released a statement saying that they did not find anything in those emails and that they had cleared Hilary Clinton et again. Our hedges would have been toast.

Everything looks picture perfect in hindsight.

In the fund, I use rolling weekly hedges almost every week however only about 10% of the time do we cash in on those weekly hedges, the rest of the time its money that we have just spent in order to maintain the hedges. Yes, when we have Brexit lie events we cash in big but those are few and far in between. Most of the time, I chalk it down to the cost of running the fund and it is already built in to our profit and loss model.

As far as using the same strategy in the account for, it would make very little sense. Think about it, only 10% (at best) of the time we would cash in. So, if we take 52 trading weeks and only 10 of those weekly hedges are in the green for us, that means roughly 5 weekly hedges we end up in the money. The rest of the time it is money spent. In the fund, we consider it money well spent because of the peace of mind. However, this account is not large enough to be able to absorb the costs associated with a weekly hedge.

Again, in theory and in hindsight, it seems very easy but it is not in the least bit easy.

Anyways, despite this earnings season being an absolute dud for us, we have had a spectacular 9 months and I have full confidence we will finish the last couple months in equally spectacular fashion.

It's not going to be a cakewalk by any means given the headwinds but the overhangs are definitely easing and we have seasonality on our side. The wild-card remains the US Federal Reserve and its misguided policy stance. However, we should be able to move past that soon enough as well.