This is going to be the last post for basket Ts in 2013. I tried to emulate an actively managed mutual fund. During 2014, my plan is to consolidate, reduce the number of positions, then when the inevitable pull back happens have some cash ready to increase some of the strongest positions. Needless to say, past performance is not a guarantee of future performance, but it is certainly an indicator.
There is nothing magic about the red green process, but over time it has allowed me to spot and take advantage of trends. Be careful, this is only about trying to spot trends, I bought these equities at different times, so this is not an apples to apples comparison.
I have to do some analysis before the year ends to see if I should sell some losers. This blog post serves as my digital trading notebook. I will read it top to bottom today, do some additional research and make the best decisions I am capable of. I need to dump enough losers to offset the dividend payments the account has received.
12/12/13 Highest performing losers(reds) - high to low
30 90 180 1yr 5yr
MCD - - - 3 4
GES - 3 3 2 3
LECO - 2 1 1 1
LF - - - 5 2
TEVA - 1 2 4 -
Decision: I think I have egg on my face with Leap Frog (LF), going to close the position to prevent further losses. Market sell, 90 shares, last close 8.10, my loss will be about $22.95 + two trade fees.
Opportunity: Lincoln Electric isn't likely to stay in the red, but it doesn't count as a value play either. Do some more research and set a trade alert in case it drops.
Next tranche of losers
30 90 180 1yr 5yr
ISRG - - - - 2
CTXS 1 - 2 - 3
RDWR 3 1 1 2 1
CORR 4 3 - 1 5
COH 2 2 - - 4
Decision: hold on to, possibly increase the position in Radware (RDWR) especially if there is a pull back. So why is it down? Depending on when one bought it it might even be an up (green). I bought it 6/27/12 and it was at a bit of a high. This shows, I hope, why red greens are NOT decision makers, but sometimes help me spot trends.
Lowest winners better to lower
30 90 180 1yr 5yr
HURC 2 - - 3 2
PANW - 1 1 4 5
MELI - - - 1 1
SSL - - 2 2 3
SLV - - 3 - 4
Analysis: Keep in mind this is relative, most of these are going to bounce around up and down, relative to each other. To have an absolute evaluation, one needs to focus only on that equity, but I find one of them a bit interesting and that is Pao Alto (PANW). I am familiar with the technology as well and they were early to the Next Generation firewall party. They have some patents, but I do not think they constitute a "moat" to keep others out of the field, in fact, I think Fortinet was earlier to market. PANW's track record isn't very long, I think their IPO was July 2012. Here is their chart, the $60,000 question is can they keep th current spike going.
12/4/13 Leap Frog (LF). This is a maker of educational tablets for children. I am always nervous about buying an equity I do not understand, but I have a relative with two small children and have seen them play with the gadget. Limit 90@8.30, last close was 8.44.
12/2/13 BSX, overall I like the company. The debt to assets is a bit higher than I like to see, I favor a ratio of less than 20, but inflation seems to be a distant concern, raising money should not be hard. I already have this position, but cautiously seek to add to it. Limit, 50@11.00 last close was 11.58. It is unlikely this will hit, this is the 3rd best performing equity in my mutual fund, but que sera sera.
The lowest performing greens in the fund in order of best to worst are SYZN, HURC, SSL, SLV. TILE AND MCD. Though I crave McDonald's cheese burgers w/o onions, love the way they are integrating into stores like Wal-Mart, see they are working hard on their menu, (if you have not tried the Bacon quarter pounder you owe it to yourself). I just cannot put another dollar in that equity; considering performance, I am overweight. Of the rest Sasol, SSL, seems to be the most interesting. They have had a great year. However, I have a lot of exposure to energy. Decided on a half hearted limit, 15@49.35 last close was 49.54.
11/30/13 Top performing reds in the fund. Best to least performing.
30 90 180 1yr 5yr
ISRG - - - - 4
TEVA - 4 3 3 -
LECO 3 2 1 1 3
COH 1 3 - - 2
RDWR 2 1 2 2 1
Think I need a calendar alert for ISRG in about two weeks this used to be a profitable stock for me, but it is clearly headed in the wrong direction. Or maybe just pull the plug. RDWR on the other hand seems like it will reach positive territory. Let's try a limit to add to our position, 30@16.
Coach (COH). There are a number of reasons why this might be a good buy, strong brand, doing well outside of the US, especially in China. However, there might be some good reasons NOT to buy as well, tepid US sales, a drift away from the original brand concept of really strong and durable purses, and a new art director, ( which could prove to be good or bad). And sales of luxury items are drifting down in China.
Decision: Deep limit, 30@54, last close was 57.90.
11/30/13 Did a lot of research into Extendicare (EXETF). Care of older folks in Canada and the US has to be a growing trend over the next 20 years though the margins may get interesting in the wrong way. Instead of a limit order, I set a calendar alert and will see how they are doing in 2014.
Also, decided to close my position on Riverbed (RVBD). We are going to get thumped this tax year and a few losses can help reduce the pain. 200@Market, 20% loss.
11/29/13 The market is only open till 1 PM today, so setting up some trades:
I have decided to harvest a loss with National Presto, NPK, they make bullets and mostly sell to DoD which is not a great place to be right now. 30@Market, but can use the loss to help offset the tax burden from the dividends.
Considering opening a position with Catamaran, CTRX. They may be positioned to compete with Express Scripts, which I hold and is doing well. The thesis is simple, some piece of Obamacare is bound to survive even if the next President is a Republican. They have gone far down the road and it will be difficult to unravel a lot of it. Catamaran's business model might let them take a bit of market share from Express in the health exchanges if things go their way. I went for a limit 30@45.00, last close was 45.55, it is not an aggressive limit, I just need some famous analyst to report that black Friday did not meet target or some such and the Wall Street computers will start to sell everything but the kitchen sink.
11/23/13 The mutual fund is doing well, but heck it is a bull market, right now is a bit like fishing in a stocked pond with wiggily worms. The scariest positive is MELI, I am up 12%, and I am confident of the long term, but have to wonder about profit taking, long past the one year capital gains hit. Added about $1500, (from dividend payouts, when possible you want to create a compounding machine), to positions in:
LECO 72.22
SZYM 8.20
Both were market purchases, I am a big fan of limit, but in a bull market you have to run with the bulls.
Update March 29, 2013
1) Limit orders that perhaps should be market
Here are all the limit orders:
5 30 90 180 1yr 5yr
FTNT - - 2 - - 1
CHEOY - - - 3 1 4
QCOM 1 2 3 1 3 3
RDWR - 1 1 2 2 2
CTXS - 4 2 - - 2
BRCM 3 5 4 - - 3
NOV 2 3 5 - - 5
INTU 1 2 3 2 2 1
TILE - 1 1 1 1 4
Lets compare the strongest performers:
QCOM 1 3 4 3 4 3
RDWR - 2 2 4 3 1
INTU 2 4 3 2 2 2
TILE - 1 1 1 1 4
Decision: 35 TILE@Market to open position, look for a drop to add more, 15 RDWR@Market, Accumulate, 50 INTU@MARKET to open position, keep limit on CTXS@ to open position, cancel FTNT do not open position, watch CHEOY closely
2) Westport Innovations. Kathy is going to invest about $1k in CLNE in her MLk basket. I hold WPRT in Ts. So, she is investing in natural gas fill up stations coast to coast in the US and I am investing in the intellectual property holder of the ways to build the engines. Long shots, but added 25@Market to my position.
Update March 27, 2013
1) Red/Green lesson learned. Need to start using longer timelines. Starting now, I think I should start to factor in 5 years when possible.
Reds 5 30 90 180 1yr 5yr
TEVA - 2 4 - - - -
ERIE - 3 3 1 1 - 2
IBKR - 4 2 2 2 - -
SSL 2 5 5 3 3 - -
NPK 1 1 1 - - 1 1
Decision: Stay the course
Update March 25, 2013
1) LQDT, Liquidity Services was a candidate for the ecommerce basket, but as I was doing my homework, it really had me scratching my head. Analysts tended to love it or hate it and a considerable number hate it. But it is interesting enough to me to open a small position in the mutual fund and watch it closely and keep learning more about the company. Decision: Limit 35 @28.75, it closed today at 29.35.
My thesis is this company has the potential to be the information broker for surplus goods. They have worked with eBAY and I have to guess one of the case studies is either Dell or HP.
Update March 22, 2013
1) CHEOY, my limit for 20 shares hit; therefore it took a dive. When I look for stock news, I am not seeing anything so far, when I look for news it is all positive including a heartwarming video of a mom hearing her son's voice for the first time. This is one of the great things about being an investor. Not sure what I am missing. Probably nothing, maybe just did not set a deep enough limit.
3/1/13 36.17
3/22/13 34.96
CHEOY is most definitely a green so lets check performance of the two above and below, best to least performing.
3/27/13 5 30
5 30 90
HURC 1 3
WFC 2 2 2 1
CHEOY 3 3 2 4
FDX 4
GSK 1 1 3 1 2
No immediate crisis on CHEOY. Fed Ex is off a bit, but they are not going anywhere and like UPS FDX stands to continue to make money from a failing post office. However HURC is a bit troubling. CHEOY does not appear to be followed by analysts, so this may be a company to invest a bit more in.
3/27/13 I am still holding pat on Feb Ex, but very aware it has lost over 7% in 30 days.
2) HURC Let's take a closer look.
1/22/13 29.02
2/22/13 29.06
3/22/13 27.10
3/27/13 27.08
It does have a beta of 1.57 and it bounces around. They did have a lower first quarter compared to 2012, largely because a big part of their market is Europe. We are past the one year point for any purchase of this stock so we can profit take at any time. No action right now, but want to watch this one closely.
Update March 18, 2013
1) The market is insane, but not to complain, everyone likes a roller coaster. While I was teaching in Orlando, it set records for back to back highs. Today, is a little bit choppy. Forget firing bullets instead of cannonballs, today is a BB day. If I do anything at all, it will be surgical.
2) Open orders:
3) Best performing Greens in order (does not include penny stock TSRYY):
3/27/13 5 30
5 30 90
Z 1 1 1 1 1
PRAA 2 2 2 3 2
DIS - 3 5 4
GS - - 4 - -
FB - - - - -
OII 3 4 3 2 3
Could it be time to head to the exits with Facebook?
3/27/13 Decision: profit take with GS and FB
4) Lowest performing Greens, high to low:
3/27/13 5 30
5 30 90
GSK 2 - 4 1 3
MCD - 1 1 - 1
RGS 3 - 3 - 2
PANW 4 2 2 2 4
WFM 1 - - 3 -
3/27/13 No action at this time
5) GS, as it says on the open orders, I put in a limit for 5 shares of GS@146.50
Update March 7, 2013
1) Open orders:
2) Reds looking for climbing activity:
3/27/13 5 30
5 30 90
RGS 3 - -
BCPC 1 1 1 1 1
RDWR 3 2 2 - 2
TDC - -
SLAB - -
TEVA 2 3
Decision: 25 BCPC @Market see screenshot above, 25 RDWR@Market. Keep a close eye on TEVA.
Decision: sell 75 RGS, 90 TDC, 65 SLAB
Update March 1, 2013
1) Open orders:
2) What's up SUP?
Nope, not Stand Up Paddle Boards though we have those in two states, this is Superior Industries, the aluminum wheel maker. They just got creamed after earnings.
Decision: 25@Market last closed 19.54
3) Ireland Bank
I made a small bet on this equity, it has done well for me, but it keeps dropping this month and there is not chance I will ever really understand it. Closing position, 350 shares@7.62.
Update February 24, 2013
1) Open orders:
BRCM 20@31.39 last close 34.53
INTU 50@54.82 last close 62.78
RDWR 15@ 35.50 last close 36.90
2) Three tranches of negative equities in the basket. From least negative to most negative.
5 30 90
MCD 3 2 3
SLAB - 3 4
GTI - - -
MELI 2 - 1
RDWR 1 1 2
Decision: close position on GTI to preserve capital, this will be a 2% loss. RDWR 15@35.50 GTC.
3/1/13 GTI is now down 28.9 percent for past 30 days.
4/27/13 GTI 7.06 down 30% over past 90, -5.4 past 30 days
3) The second tranche is even further down, so we need to be careful and really think this through.
5 30 90 180 365
IBKR - 1 - 2 -
ERIE - 3 2 1 -
SSL - 4 3 4 -
CHKP 1 2 1 3 -
HAIN - - - - 1
TEVA - 5 - - -
Decision: close HAIN and TEVA. Purchase 10 CHKP Market@52.23.
3/1/13 CHKP 51.83 up 1.68% past 30 days, hard to say how this is doing.
3) The third tranche would be the lowest performing equities in the basket. I should tread very carefully here.
3/1/13 5 30
5 30 90
GES 4 1 5
BCPC 3 3 3 2 1
RAVN 1 4 2 3
SQM - - -
IRBT 5 - 4 1
WPRT 2 2 1 2
Decision: close SQM. Buy WPRT
3/1/13 WPRT 28.28 down 2% on the day, up 5% on the past 30, this stock has a beta of 1.91, so there will be some tummy churning moments. Let's set a Google Alert on IRBT, I so very much want this stock to succeed.
4) These are the lowest performing equities that are green ( positive ) in the basket.
5 30 90
GSK - 3 3
NTGR - - -
BRCM 1 2 1
NOV - - -
TDC 3 - 4
WFC 2 1 2
Decision: Close NTGR Market, it is falling fast. Last close was 33.70. Other than that, hold and wait on the rest.
4/27/13 NTGR 28.82 down 28% over last 90 days
5) Greens with the biggest dips on Friday
4/27/13 30 90 1 yr%
1 5 30 90
Z 3 1 1 1 2 1 58
ESRX 1 3 2 3 - 3 3.4
ALV 2 2 3 2 1 2 15
Decision: No action required
6) New candidates to be added to basket. All of these candidates appear to be well run companies with low debt. I have experience with Fortinet (FTNT), Pao Alto (PANW) and Whole Foods ( WFM). I can't say I play Leap Frog (LF), but have seen kids with them. CRUS is a major supplier for Apple (AAPL), to by this stock is to believe Apple will go back up.
5 30 90 180 365
WFM - - - - 4
CRUS - - - - 2
PANW 1 2 3 - 3
FTNT 1 1 1 -1 -
LF - - 2 - 1
Not exactly awe inspiring. But I do want to keep an eye on these, especially Whole Foods, they are not carrying as much debt as most other grocers an in conjunction with Costco and Wal-Mart could be poised to take market share away from the competition.
Decision: PANW 15 Limit@55.00, FTNT 30 Limit@23.50.
February 4, 2013
Sold 100 LRN - Thesis, it is still in the green, but suspect the pressure on proprietary institutions will make it a bit choppy. Closed today at 18.53
2/24/13 21.81
3/1/13 20.83 Phoenix University Accreditor reccomends probation, this will probably impact most proprietary institutions.
4/27/13 25.21 When am I going to learn to slow the heck down?
Sold 95 HYLD - Thesis, time to reduce exposure to bond funds, better to actually own the bonds. Closed today at 50.68
2/24/13 50.87
3/1/13 50.92 Making progress at buying bonds in basket Ak, keeping them short, looking for better opportunities in 2015 and 2016.
Open limits from previous analysis:
Ticker Limit Last Close Action, if any
INTU 54.83 62.09
JCI 30.0 30.83
BSX 5.00 7.45 Change from limit to market
FDX 89.00 103.39 Cancel, this bus has left the station
BRCM 31.5 32.45
ALV 59.00 65.01 Strongly considering a modest market buy
Five lowest % that are positive in the account, lowest to highest 2/4/2013
2/24/13 5 30
BRCM 1 2
SLAB - 3
IDX 2 1
OTEX - -
GTI - -
IDX has performed the best in the past 30 days, but I am overweight both on this ETF and Indonesia in general so passed on adding. SLAB has performed second best for 30 days and 90 days. Decision: Buy 15 SLAB Limit@43.23.
2/24/13 42.27
3/1/13 31.09 Ouch!
4/27/13 39.32
Five highest % that are negative in the account, highest to lowest
Ticker 5 30 90 180
RGS 1 2
MELI 2 2
MCD 2 1 2 (tie)
HAIN
JCI 1 1 (25% increase in past 6 months)
How about these tea leaves, how do you choose? I will certainly watch these closely.
JCI profit is down, and their debt is close to my 20% limit. Decision: close the position and lock in a small loss before it becomes a big loss. Last close was 30.83.
Decision: take no more action tonight, set a Google calendar event to revisit the remaining 4 equities in ten days.
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