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Sunday, November 22, 2015

From now on

As evidenced by my past entries, I will be doing writing in this blog with my own personal portfolio with my advanced analysis being put on Seeking Alpha as a supplement. I think that ends up evening out to a nice medium for me.

It would obviously get quite messy if I posted extra when I publish new Seeking Alpha articles. Then it would come out to posts on this blog only containing an update for a new article over there, which would just be inconvenient.

A new square will be on the right of the blog with a link to my Seeking Alpha profile with all of my post, and I may send out just a little notification in conjunction with a new post here. It will be unobtrusive, of course.

So back to business on the portfolio update.

I've slightly modified my portfolio from the past setup I had. I have slightly reallocated my assets to sell off GILD, and to include a new position I have opened up,

CALM Cal-Maine Foods, Inc. daily Stock Chart

Cal-Maine Foods. This one has one of the best sets of fundamentals I have seen in quite a while, and I think the valuation will appreciate significantly within a notable time period.

Now, I'm being relatively ambiguous with naming the exact time period I will hold this position, as there is no exact way I can tell exactly when I will exit it.

Fundamentally wise, the attributes surrounding it which are notable deem it a strong long term pick. It has a pretty fantastic set of stats, some of the most notable being:

  • 9.94x P/E Ratio, and 8.25x Forward P/E, deeming it relatively undervalued when compared to the broader market, which has an average P/E of about 15x. Nonetheless, the fact that the Forward P/E is still lower than the current P/E makes known that the stock is still projected to grow in earnings from this year to the next.
  • 0.44x Price to Earnings Growth Ratio. This makes known that the stock is undervalued in comparison to its earnings growth.
  • Low debt to equity ratio levels, at 0.05 current and 0.04 long term.
  • 6.92% dividend payout ratio. The dividend net is strong with this stock.
  • Very good management effectiveness stats. 29.2% Return on Assets, 39.7% Return on Equity, 20.0% Return on Investment. This means that management is able to maximize efficiency out of this company's enterprise operations.
  • A 49.09% short float. This is huge. I have, really, no idea why the stock is being shorted so much. But the fact that the stock is remaining stable in price action, complimented with the nice fundamentals deems a short squeeze very likely.
Here's some TA for you, on the point of why in the short term, in a technical view, this is still a decent pick as well.

So there I have it. I feel pretty good about this pick.

I am holding shares in CALM, GM, and VBR right now.

Wednesday, September 23, 2015

Post about CALM

I got another article on Seeking Alpha up.

The link is here.

Tuesday, September 22, 2015

Supplementary Writing


Sorry for the post on such short notice. I will review my portfolio positions soon.

Just wanted to post that I have begun supplementing this blog with writing articles for Seeking Alpha.

I recently got my article on JetBlue Airways up, the link to read it is here if you want to check it out.

My overall profile is here.

Nonetheless, I will continue to post on this blog, so don't worry.

Sunday, July 19, 2015

It's been a while.

I have neglected this for far too long now. It's been what, a month and a half since my last post?

It's not like I've been sitting around all this time remaining idle, however. I've not neglected my investing activities. 

So this is just going to be a little rundown of what has happened so far since May 27th, my last entry, in chronological order.
  1. The simulator has died already. It's somewhat depressing, and I guess it speaks to the consistency needed to perform well or something. I was far and away in first due to my speculative bets with like a 15% return while the next guy had a meager 4%, and I was getting really bored. I checked my competition's portfolios and some of them were doing really boring stuff, like investing maybe 5% of their entire portfolio in Apple or something. So their portfolios each day would fluctuate under a tenth of a percent each day, which I guess is a safe way of going about it, but it definitely translates into an uneventful experience. I already stopped doing it for a while; I'm now just doing my own thing.
  2. I got the internship. It's been pretty awesome so far. I'm halfway through it, but it has been thoroughly enjoyable. Nothing really much else to say about it, really. It's been much better than what the stereotypical internship experience would have one assume.
  3. Modified my portfolio. That's what I'm going to talk about most.
I have three holdings. 50% of it is in VBR, the Vanguard Small-Cap Value ETF. Holding period - indefinite unless significantly overvalued or breaches 10% trailing stop

VBR  Vanguard Small-Cap Value ETF daily Stock Chart

This is because out of the following stock cap categories and trading philosophies: Large-Cap Growth, Large Cap Value, Mid-Cap Growth, Mid-Cap Value, Small-Cap Growth, and Small-Cap Value, Small-Cap Value funds outperform all of the rest over a longer period of time.

You can read more about the back testing of this claim here.

I also want some more exposure to small caps than what I have right now, as my other two holdings are large cap.

So here are my two other holdings:

GILD, holding period - indefinite unless significantly overvalued or breaches 10% trailing stop

GILD Gilead Sciences Inc. daily Stock Chart

Some financial highlights I have to mention that are pretty important:

  • Low PE and FWD PE, at 13.44, and 10.69, respectively.
  • 0.65 PEG Ratio
  • Pays out a dividend. Indicative of steady financial management and long-term cash flow management
  • I predict steady and solid earnings growth as the time goes on
  • 42.7% Return on Assets, 91.3% Return on Equity, 44.8% Return on Investment
  • High target price, generally high analyst outlook
  • 10.24 PB Ratio.
  • Somewhat high debt to equity levels, around 0.7
But nonetheless, I think the pros seriously outweigh the cons here. This isn't necessarily an undervalued stock, but it is undervalued in terms of its future growth, at least in my opinion.

Plus, the quarter's earnings will be out this Wednesday, so this is also somewhat of a speculative play. 

I am also holding GM, holding period - indefinite unless significantly overvalued or breaches 10% trailing stop

GM General Motors Company daily Stock Chart

Another large cap, so it's going to be relatively more stable.

Financial highlights:

  • Low PE and FWD PE, at 14.26, and 6.07, respectively.
  • 0.77 PEG Ratio
  • Pays out a dividend. This one's pretty high, at 4.7% Indicative of steady financial management and long-term cash flow management.
  • PB ratio not too high, at 1.36
  • High target price
  • Relative Strength Index indicator pretty low, at 26.59 - this means recent price action movements has pushed the stock to a point where it is considered "oversold" at least in a short term perspective.

  • ROA, ROE, and ROI could be better. They are positive, but generally not to at the level I normally like.
  • High debt to equity levels, around 1.15
  • American auto market is known to be a bit iffy in terms of maintaining a strong presence in the auto market.
This is more of a long-term value play, so to speak. I don't expect it to rocket higher in price but I think a company this large has been hammered a bit too hard recently.

That's it.

Will post again soon. Maybe I'll look specifically into a company or talk about an important tip or issue at hand. 


Tuesday, May 26, 2015

A Stock Simulator vs. Real Life

Before I want to get into the topic as described in my title above, I just want to put out another portfolio update.

Things have been going pretty good. My main actual portfolio, which is focused solely on fundamentals, has been doing pretty solid. I have no worries about it. It's filled with stocks of which are relatively undervalued when compared to the broader markets.

Since this portfolio is a 100/0 long/short, I didn't want to overexpose myself with straight up buy-side exposure to relatively risky stocks.

Now, that doesn't mean I'll hesitate to jump on smaller cap stocks of which I believe are undervalued and or lucrative growth opportunities, but these days, I want to err on the side of caution. There's always going to be time for investment opportunities, and I don't want to blow out.

Anyway, for the time period I am planning on holding these positions (a long time), I know I'll be fine. Real losses suck. Losing money sucks. Actual realized losses feel terrible.

Real losses.

What about fake losses?

So I joined a stock simulator with some people I know from school. It's pretty nice. I enjoy doing my own independent research and learning quite a lot more when I can actually talk to people I know about a subject I truly do enjoy talking about as well. For a pretty long time, I would just learn on my own. But synthesizing my ideas and teaching concepts to people who are pretty interested, at least for now, about trading is definitely beneficial to both parties. It definitely brings in some excitement to what has been more of a "steady" process of learning about trading.

Anyway, new point. This is a stock simulator.

It lasts for 70 more days, and the goal is to make as much money (or lose as little money) as possible within that time period.

The rules have changed drastically.

I'm quite happy with them, too. I get to be able to test and screw around with speculative ideas that I have that would never be implemented in a personal portfolio which primary goal now is to not lose capital; college is coming up in two years. Now, in the game, given the amount of other participants, the only feasible way to win is to make as much money as possible. The risk tolerance is much greater, because obviously, I'm using fake money.

Some people that are involved with it are pretty competitive about it, too. It's great. However, to me, I honestly don't really care how I end up placing, or whatever. It's pretty fun; taking on riskier trades with higher betas and volatility. But a stock simulator takes out some important concepts and experiences that can only be experienced with real money.

  1. The losses are not real. This is the biggest one by far. We have $100,000 to work with and margin trading is allowed, so there's no T-3 settlement we have to deal with. We can constantly deal in and out with no day trading taxes as well. If we were to lose money, no big deal! It's all fake, anyway. Our actual wallets aren't going to be hurt. But what if this is money you actually saved up for years to acquire. What if this is a portfolio that you have been managing for the past 5 years? Also, there's really no way to describe the feeling of actually blowing out on a stock in real life with real money. It just has to be experienced. The feeling sucks.
  2. The time constraint. In real portfolios and situations, there generally is no time constraint. If there is, the time period is much more plausible, at least above seven to eight years. Racing to make the most money in two months is simply not realistic. In this situation, doing the conservative, less risky option, will simply not work. Trading in volatile stocks is the only way to win. There are eight other people in my game. If I do what I'm doing right now in my real portfolio, I will take on less risk, which is boring, and lose or make a smaller amount of money. However, there is no doubt in my mind that at least one of the other eight people can easily beat it, even if they don't do "the right thing", either by pure luck or if one of their picks happens to be a winner, if that makes sense. 
  3. On that note, fundamentals are deemed much less important to overall performance in a two-month time constraint. Technical analysis, only looking at the chart for short term swing or position trades, is simply a better decision. Finding undervalued stocks with fundamentals, and buying into them with TA will not work. As to why, to put it simply, it usually takes much longer for the market's perception on how a stock should be priced to align with an investor's valuation through fundamental analysis than two months. That time gets cut even shorter if one were to wait for a solid buying opportunity with TA as well.
  4. Finally, Taxes. This concept has actually a pretty significant impact on actual trading decision making. In real life, people get taxed on their capital gains and volume of trades. If they trade a lot, they get taxed quite a lot. People think twice before trading shares every other day.
With that in mind, I already set up and outlook and philosophy for taking on this game. I guess it's sort of comical, how unrealistic this is is, but it's pretty fun. I haven't done risky and far-fetched stuff in a while and it feels good to be able to do so while remaining engaged. Like I said before, there is no actual repercussion for losing. I don't get burned in real life. It's pretty great. I only wish I could use leveraged options to make it even more risky.
  1. I'm going to do a 70/30 long/short portfolio. This is because I think the market still has some room to run for the next two months, but I can't be sure as it is only two months, so if it goes through a correction, I will still have my shorts to hopefully still bring me up. I also want to be able to short a decent 30 percent of my portfolio to hedge my aggressive longs as well.
  2. Invest all the cash. No margin on my longs, however, simply because I think using margin always is always a dumb idea. In this situation, the saying holds true, "go big or go home". I didn't sign up to manage an entirely new portfolio to stay on the sidelines holding a large portion of cash. In real life, sure, that's not always a bad idea. There could be times when one does not see investment opportunities that he or she wants to jump on. But having only two months to work with really changes the game.
  3. Speculate. In advance, I am not planning on just throwing my money around. I am still going to due my due diligence and research. But like all seasoned traders know, all the research and diligence in the world still may go wrong, and it's just so much harder to consistently be right with risky trades. I won't really get to do this for quite a while with my own actual portfolio and money, so I'm going to really let go here. During my tenure in the game, I will probably trade in leveraged ETFs, some small and maybe even micro caps, maybe even bet on earnings and rumors. We'll see. Again, I wish I could use options. I could really go crazy there, but whatever. It's not hard to find ways to be risky in the financial markets.
Anyway, that's about it. This took quite a while to write. I should probably be studying.

I think I'll maybe update my fake sim portfolio along with my actual one for the next seventy days. I'll be able to see differing approaches to the markets, and it will be fun to see how they compare against each other, at least for the next two months. 

But there's the 90/90/90 rule, that 90 percent of new "traders" lose 90 percent of their money within 90 days. and I'm only doing this for 70 days. The comparison may still not be too realistic.

I'll still probably update on the sim portfolio.

In other news. Finals are coming up. I think I'll be fine. If it goes well, I'll have a really good semester. Probably my best so far. 

I also have an interview for a paid internship tomorrow. I need it to go well. I am super interested in the topic, can do everything they ask of an intern, and the location will be awesome and convenient for me. It would be kind of cool, too, in that I could help with my family's expenses and seriously save for college. It's definitely coming up soon, and the pressure of college is definitely building.

Sorry in advance. Couldn't add any pictures to make this post more interesting. Tried. 

Sunday, May 3, 2015

Update on Portfolio

Things are going okay.

So far, to make a long story short, the four positions that I have opened have averaged out to put me in the red right now.

However, that doesn't really matter. These are all positions that I was planning on holding onto for a decent amount of time. I'm not trying to ride on market momentum with a high flying growth stock; I'm mainly trying to take advantage of large-caps that have hit the dividend net.

I think I might try to change it up, though. I might want to catch the bottom of some stocks while hitting the momentum of others.

Due to the fact that I am in the primetime workload phase of my school year, I didn't want to try and swing trade any riskier trades. None of the positions I am in are speculative in nature.

I think I'll change my position from KORS to UN.

But KORS is so undervalued when you look at its fundamentals!

So let's focus on the broader markets.

On the straight up technical aspect, it does not look to be in dangerous territory. It's in a trending triangle channel up; it seems to be balancing near that area pretty well. RSI at 53.72. In terms of overall technical strength based on past performance, I'd say it looks pretty moderate.

But then again, I would be lying if I said that I knew what the market was going to do in the short term. I have no idea. 

But my conservative positioning should rectify any short term mistake, as it is mid-long term oriented.

There really isn't much to say. Just a quick little update. I personally feel that although my portfolio's performance the past month could be a bit better, this is sort of like the premature phase before my positions get into an upward swing.

Thursday, March 19, 2015

Addition of a New Position

Another update.

I added another position into my portfolio.

Las Vegas Sands, or LVS. This is a chart of its performance for the past year.

I'm really hoping it will bounce back after it hit multiple bottoms at around the 52.5 level. However, even if it still manages to slump a bit deeper I am pretty sure that the "dividend net" will end up catching the falling knife at one point or another. I mean, it is already at above 4% as I'm speaking already. (The dividend net is when the price of the security gets so low that the dividend yield percentage gets "raised" to the point where the yield is too desirable for the price to go down any further.)

Also, in terms of just making a contrarian trade, I am also liking it in terms of that aspect as well. I think that the price has been pretty significantly battered for the past year, and I am hoping that the dividend net as well as the multiple bottom technical setup will cause the share price to get back to positive results.

However, one of the underlying reasons behind its price decrease is pretty poor gaming revenue performance in Asian markets and subsidiaries. But I think the strong management and the fact that it is one of the best of breed stocks will keep it afloat.

But to make sure that this trade does not go completely haywire for me, I put down a trailing stop sell order at 48 just in case it breaks through the 50 support level. That would be a pretty bad loss, but in all honesty my supposed win/loss ratio is looking pretty fine. I'm expecting this to be a pretty long term holding period, maybe 6 months for it to get back to solid levels.

So that's what I did. I'm also thinking about getting some BABA stock as well, if it holds above the 80 level. I think it is a really strong company representing a huge market. Pretty good looking growth stock.



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