Weekly Update Week Ended March 11, 2017
For a change the indices closed slightly lower on the week as concerns about the FOMC meeting this coming week seemed to put a lid on the excitement of the last few of months. Rightly so, in my opinion, how the Yellen led Fed seems to be pretty hot to trot on raising rates. They seem not to have learnt from the mistake they made by prematurely raising the interest rate back in December 2015 which led to global markets collapsing in January and February of last year. Yes, this time around things are different however, its not like economic growth globally is zipping along. India and China will still grow around the 6.5% rate but things here at home will be at the 2% to maybe 2.5% GDP growth rate towards the end of 2017. Across the pond, things are a lot more uncertain with Brexit/trigger of Article 50 looming large.
Last week, we had Finisar report earnings which were received with a big raspberry by investors and that took down our optical component investments as well. The irony in that is that both Oclaro and Applied Optoelectronics reported outstanding results of there own and guidance was even better going forward. Be that as it may, I took the opportunity to add to our investment in both those companies.
President Trump has still to unveil his infrastructure/tax cuts/repatriation plans and techland continues to be whippy as a result. A whole lot of chopping with small baby steps higher is how I look at it. It also seems like he has totally forgotten about his Executive Order on cybersecurity as well. Cest la vie.
We ended the week up 34% for 2017 (gave back a little ground last week in the churn and burn) and that is upsetting to me despite the outperformance compared tp virtually any other site one would use as a comparative. Things will only get better going forward from this point on.
Keep in mind that I continue to remain very high in cash and near cash and that has been the case since inception which makes the performance gratifying ti an extent however as I say almost every week, a lot of work remains to be done and we have only just begun as far as the year is concerned. No time to rest.
This week on the earnings front we have YY, JBL, ORCL, YRD, and ADBE all reporting earnings, so the week will provide some insight even though we have no exposure to the companies at this time.
A continued reminder for all of us.
Please keep your positions in size with your account size (value). Mot importantly please remember that I am running a marathon here and not a sprint. I am in no hurry whatsoever for any position and thus will not enter a position unless I feel the risk/reward is stacked in my favor. Yes, I will occasionally have positions work against me despite the risk/reward prior to the trade but if I was batting a thousand, none of us would be in our little room. We would all be on our own private islands. Even more important for all of us to remember that trades and opportunities will come no matter what the markets are doing.
Please, please don't roll the dice and don't bet on any one single position without keeping the size relative to your overall account. I promise you even 1 or 2 call options at a time add up to spectacular returns over time.
Not a sprint but a marathon.
For your reading pleasure.
Our futures are indicating a flat to slightly open.
Until next week, I hope each and every trade/investment is a great one for you.
See all of you in our little room.