What a tubulent week! For the week ending Oct 17, here is the market tally. Dow closed at +4.7%, S&P500 almost similar +4.7%, NDX: +3.3%, Nasdaq (COMPQ) +3.6% and Russell 2000 almost flat at +0.75%.
For OPNewsletter, it was rather an unusual month. We opened one mini-portfolio consisting of options in Russell 2000, that was officially closed for +9% gains including commissions. Thereafter sensing market collapse I stayed away from investing for OPNewsletter we were in cash throughout the past 4weeks. Cash surely outperformed the market during which Dow lost almost 3,000 points. The results doesn’t include my trade alerts for speculative trades (mostly bearish). Well in this bearish market there was a bullish call too :
Watch out for bullish BTU, but only if it crosses > $30.25, you may choose either Bull Put Spread, or straight call (but straight call lose due to IV loss) or any other way…you may choose covered call as well…keep very tight stop loss, kinda $28 or so..
Also Since Sept 29th, we have already started preparing for the upcopming bull market (not investing yet, it’s only preparation to find quality stocks). On Monday, I also shared a list of 80 stocks that are making to my value screen and some of those are now below my price targets. In fact I shared one value stock that is hammered so badly in the past few weeks that it’s share prices is almost half of it’s book value. It’s levered but leverage ratio is still below the S&P500 (these are only one of few valuation indicators). I shared how I played it so that my effective cost was almost 15% lower than market price.
I also published a special report (for OPN members only) sharing my view of what to expect and what to do about the broader conditions in the market. No, this doesn’t have a stock idea but it deals with the market psychology.
I am in the process of selecting portfolio and trades for Nov’08. You may want to sign-up for OPNewsletter as to benefit from the a) fresh portfolios, b) my special/directional picks, c) my list of potential value stocks, d) general almost daily market comments and e) member’s sharing on the forum.
Stay cautious, Stay profitable, OP