Volatility Portfolio | Click to Expand Live Table
| Purchase Date | Symbol | Name | Purchase Price | Last Price | Jubak's Gain/Loss | Jubak's Gain/Loss % |
|---|---|---|---|---|---|---|
| 2023-03-24 | 374.40 | |||||
| 2023-03-24 | 280.57 | |||||
| 2023-03-24 | 267.79 | |||||
| 2022-10-10 | 74.64 | |||||
| 2022-07-22 | 24.54 | |||||
| 2022-07-12 | 28.89 | |||||
| 2022-06-17 | 28.86 | |||||
| 2022-05-09 | 24.31 | |||||
| 2022-03-14 | 14.51 | |||||
| 2022-03-14 | 40.49 | |||||
| 2022-03-04 | 37.97 | |||||
| 2022-02-02 | 68.27 | |||||
| 2022-01-21 | 104.55 | |||||
| 2021-11-16 | 10.18 | |||||
| 2021-05-19 | 11.23 | |||||
| 2021-03-31 | 181.75 | |||||
| 2021-03-31 | 242.84 | |||||
| 2021-01-12 | 25.13 | |||||
| 2020-06-02 | 101.01 | |||||
| 2019-08-14 | 28.79 | |||||
| 2019-07-26 | 9.82 | |||||
| 2019-06-27 | 204.89 | |||||
| 2019-01-28 | 56.96 | |||||
| 2018-06-15 | 22.27 | |||||
| 2018-01-29 | 48.89 | |||||
| 2017-09-11 | 126.18 | |||||
| Purchase Date | Symbol | Option Contract | Type | Expires | Purchase Price | Strike Price | Latest |
|---|---|---|---|---|---|---|---|
| 2023-03-29 | VIX | VIX230621C00023000 | CALL | 2023-06-21 | 3.05 | 23.00 |  |
| 2023-03-28 | SCHW | SCHW230519P00052500 | PUT | 2023-05-19 | 3.70 | 52.50 | |
| 2023-03-06 | VIX | VIX230621C00023000 | CALL | 2023-06-21 | 2.54 | 23.00 | |
A volatility portfolio has to be, in its nature, different from the other stock and ETF portfolios that I run on these sites. It will be more trading oriented since volatility is, well, volatile. I don’t see the portfolio as a core holding for anyone’s portfolio, but more like a collection of ideas for you to use in hedging a portfolio, for exploiting a temporary market trend, for profiting from a run too far in one direction or another, and for exploiting some under-followed parts of the financial markets. (All of this will be tracked for performance, of course, because how, otherwise, do you know anything about how good this advice has been.)
Buying Schwab Put Options on outlook for a very rocky April 17 earnings report
This is shaping up as a very tough earnings season for all financial stocks. But no stock looks more exposed to a short-term hit than Charles Schwab (SCHW.) Which is why I’m adding the May 19 Put Options with a strike of $52.50 to my Volatility Portfolio tomorrow, March 29.
Oil rallies, finally
Oil rallied today, Monday, March 27, for the first time in, well, quite a while. Oil is likely to finish with a loss in March, for a fifth monthly drop. So today’s move, which saw West Texas Intermediate jump by almost 55, marked quite a shift in direction.
Please Watch My New YouTube Video: Quick Pick KBE Bank Stocks ETF
Today’s Quick Pick is SPDR S&P Bank ETF (NYSEARCA: KBE). I’m not suggesting buying this now: I’m suggesting you watch this and buy Put Options on this ETF when the time is right. The SPDR S&P ETF is approximately 80% regional banks. As you can imagine, it took a huge hit during the recent banking scare and would have been a great Put Option last week during the plunge in the sector. Options are a way to leverage the volatility of this market. The recent exit of my VIX Call Option resulted in a 100% gain in about a week. For KBE, I’d look at Put Options that climb in value as the price of the ETF sinks. At the time of recording, KBE was selling at about 37. I’m looking at the June 16 Put at a strike price o 38. At the moment, the Put is deeply underwater but I’ll continue to watch this rally to see when it’s worth it to jump in. At the moment, I suggest you watch this one: Don’t buy just yet but wait for the next shoe to fall in the banking crisis.
Please Watch My New YouTube Video: Quick Pick Apple (but not until it drops to $140 or so)
Today’s Quick Pick is Apple (NASDAQ: AAPL). For this Quick Pick, I’m suggesting you wait to buy until Apple falls to around $140 (which I think is coming.) Apple, like many tech stocks, is a seasonal stock, and we’re currently in one of the company’s traditionally weaker quarters. The Christmas buying quarters (the last two quarters of the year) are when Apple brings in the most revenue, and the first two calendar quarters are generally weaker. Apple took a hit during the big downward turn on the bear when all tech stocks were hit, but the stock recovered strongly during this early 2023 rally. If shares get down to $140, that’s a great place to get in before Apple announces new technology and updates to its product line. There are rumblings of an Apple VR headset announcement coming soon and we know that we’ll see new iMacs and Powerbooks. We can also look forward to the Apple Developer Conference in May and new product announcements in September. If you can get this cheap in the first half of the year, you can look for a big recovery in the second half of the year.
Please Watch My New YouTube Video: Will China Send the Global Economy Surging?
Today’s topic is Will China Send the Global Economy Surging? We’ll really know the answer to this starting on Sunday, when the National People’s Congress of China meets. The leaders of China will make some important decisions for the Congress to rubber-stamp. China is looking for a 5% or higher GDP growth this year after last year’s 3%, but in order to get there, they’ll have to stimulate the economy. Local governments are drowning in debt that they can’t pay, and the government’s usual stimulus plan of requiring local governments to borrow and then spend it on “infrastructure “, isn’t likely to work. There’s also added pressure to cut interest rates to stimulate the economy and the rising tide (albeit a very low tide) of disgruntlement of the government and Xi Jinping’s leadership throughout the Covid lockdowns and the subsequent deadly spread of Covid-19. All this while the population is aging dramatically (with little to no retirement infrastructure), following the one-child policy, which reduced the younger population drastically. To take advantage of the expected and necessary economic stimulus, I recommend the iShares China Large-Cap ETF (NYSEARCA: FX) which captures a lot of the state-owned and larger corporate companies that would likely benefit from a stimulus from China. You’ll find it in my Perfect 5 ETF Portfolio on my subscription JubakAM.com site.
Investors really don’t want Pioneer Natural Resources to acquire another producer
On Friday, shares of Pioneer Natural Resources (PXD) fell on a Bloomberg story reporting rumored talks between the Permian Basin oil shale producer and Appalachian natural gas producer Range Resources (RRC). On Monday shares of Pioneer rebounded as the company denied that it was in acquisition talks. The lesson? Investors really don’t want Pioneer to spend money on acquiring more assets.
Adding Pioneer Natural Resources to my Dividend Portfolio on 11% annual yield
Wednesday, February 22, Pioneer Natural Resources (PXD) reported better-than-expected adjusted earnings for the fourth quarter of 2022 while revenues came up short of Wall Street estimates. Revenue was still up 18% year-over-year to $5.1 billion. Fourth quarter net income nearly doubled to $1.48 billion or $5.98 a share, from $763 million, or $2.97 a share, in the fourth quarter of 2021. The company declared a quarterly total dividend of $5.58 a share, made up of a $1.10 base dividend and a $4.48 variable dividend. The total annualized dividend yield is approximately 11%. Which is why I’m adding the shares to my Dividend Portfolio today.
Wednesday’s rally in the market’s most speculative stocks is the last straw for me: I said I’d be a seller into any post-Fed rally–but what specifically would I be selling? Here are the 12 stocks I’d sell now
The rally on February 15 sure looked like a speculative blowout of the kind that often signals a market top. For me, it was the last straw and I’m selling into the rally. This post tells you what I’m selling and how I arrived at these decisions. But first, a few words on Wednesday’s move.
Adding Equinor as another energy play to my Jubak Picks Portfolio tomorrow
Today, Wednesday, February 8, Equinor (EQNR) reported a record $74.9 billion adjusted operating profit for 2022. That more than doubled the previous record. If you’re looking to add an energy stock to your portfolio ahead of a year that looks likely to be a good one for energy stocks, I’d suggest Equinor. I’ll be adding it to my Jubak Picks Portfolio tomorrow with a target price of $40 a share.
Microsoft launches AI-enhanced version of its search engine Bing; Google responds with Bard
This isn’t exactly unexpected. Microsoft (MSFT) today unveiled new versions of its Bing search engine and Edge browser powered by the newest artificial intelligence technology from ChatGPT maker OpenAI. Microsoft recently invested $10 billion in OpenAI.
Microsoft reportedly plans to cut 11,000 jobs; this is a serious indicator for the economy
Granted these are all reports from outside news sources but there are a number of them. Where there’s smoke there might well be fire. U.K. broadcaster Sky News has reported that Microsoft plans to cut about 5% of its workforce or about 11,000 roles.
Apple’s plans for AR headset point to fewer product launches than usual in 2023
News, rumor, and speculation from the Consumer Electronics Show point to a second half of 2023 launch for Apple’s (AAPL) AR “metaverse” headset. Apple has been “launching” this high-performance AR headset since 2017 but plans for a launch were put off in 2020, 2021, and 2022. The launch has even slipped in 2023 from plans to introduce the headset in January with the product shipped later in 2023. But now it looks like a spring announcement
Is the VIX volatility index “broken” or is this a trading opportunity?
I vote for the latter–even though I acknowledge that the VIX, the CBOE S&P Volatility Index (VIX), which is supposed to track expectations for short-term volatility in the market, is behaving very strangely lately. The VIX is supposed to climb along with fear in the market as investors and traders step up to buy options and futures, even at higher prices, in order to hedge risk. But even as stocks have struggled in December the VIX has tumbled. It was down another 5.01% today to just 20.87.
Earnings from Nvidia and Walmart could move the market this week
Expect a ton of earnings reports as third-quarter earnings season hits its stride. A few could even move a sector or maybe even the market as a whole. The biggie for the week, I’d argue, is Nvidia (NVDA) on Wednesday, November 16, after the market close. But we’ve also got big news in the retail sector with Walmart (WMT) due to report on November 15.
Please Watch My New YouTube Video: Trend of the Week U.S . Oil Production not Rising as Expected
Today I posted my two-hundred-and-fifth YouTube video. This week’s Trend of the Week: U.S. Oil Production is Not Rising as Expected. Oil prices have averaged $100 per barrel over 2022–a figure that would normally lead oil companies to expand production and capital spending, but it hasn’t this time. According to the Energy Information Administration, U.S. oil production is only up about 3% from December 2021. Projections had the U.S. at 12 million barrels a day by the end of this year, but we’re currently only at 9.77 million barrels a day. Why is the production not going up? Oil shale fields deplete faster than traditional fields and we may have reached peak production in some of these oil shale basins. The best properties may have been exhausted and we’re now seeing companies move to their more inferior properties. The drilling and fracking may be happening at a steady pace, but we’re not getting as much out of the wells and properties currently being drilled. Companies that had a stock of drilled, but uncompleted have now worked through those “spare” wells and don’t have the motivation to drill new ones as Wall Street and investors would prefer high dividends instead of capital spent on a commodity that has an unclear future. The two oil companies I would look at are Pioneer Natural Resources Company (NYSE: PXD) and ConocoPhillips (COP) because of their mix of resources.
Please Watch My New YouTube Video: Trend of the Week Seasonal Trends in Energy
Today I posted my one-hundred-ninety-sixth YouTube video: Trend of the Week Seasonal Trends in Energy. This week’s Trend of the Week: Seasonal Trends in Energy. There’s a predictable pattern in oil and natural gas prices. In late fall, October to November, you can expect a deep dive to begin and carry on through the winter, with a sharp rise in March and early spring. You can see this trend looking at previous years in the United States Oil Fund (NYSEARCA: USO) and the United States Natural Gas Fund, LP (NYSEARCA: UNG). Right now, we’re heading into that dip in energy prices but you should not sell – in fact, you should be adding to these positions. This seasonal fall in energy prices will allow you to get ahead of the spring bounce. Europe’s energy supply is enough to get through the upcoming winter but, in March, as they look toward next year’s supply, they’ll need to start rebuilding inventories in a market strained by the war in Ukraine, cuts in production, and a hostile OPEC. Stateside, the US Energy Information Administration is projecting record production from the Permian Basin of Texas and Oklahoma, as well as record production of natural gas this year. Even though we’re not seeing a whole lot of capital expenditure, they’re uncapping wells and pumping them harder. Look at USO and UNG as ETF oil and natural gas buys For individual stocks I’d look at Pioneer Natural Resources (NYSE: PXD), ConocoPhillips (NYSE: COP), and EQUINOR (NYSE: EQNR)–all of which I own in portfolios and have no intention of selling anytime soon.
Selling Tesla tomorrow out of the Volatility Portfolio on China slowdown and trade war uncertainties.
Even before the Biden administration launched a new U.S./China trade war by imposing restrictions on U.S. exports of advanced chip technology, Tesla (TSLA) was facing a sales slowdown in China. Now, with what I regard as the near certainty that Tesla will be one of the choice targets in any Chinese retaliation, I think it’s time to sell Tesla and get out of the way of what looks like a truly nasty tit-for-tat war of sanctions and restrictions. Tomorrow, October 12, I’m selling Tesla out of my Volatility Portfolio with a loss of 63.74% since I added it to the portfolio on November 10, 2021, near what would turn out to be the high before the onset of today’s Bear Market for technology stocks.
It’s a new trade war with China and this one is really, really serious
If you liked the Trump administration’s trade war with China, you’ll love the Biden administration’s new, more dangerous, escalated version. Rather than slapping tariffs on Chinese goods, and inviting retaliatory tariffs by China on American products, the Biden administration war limits the same of advanced semiconductors and chip-making equipment to Chines companies. The action is aimed straight at the heart of China’s efforts to build its own chip industry. And it plays right into a belief, stoked by China’s President Xi Jinping, that China is the victim of a Western plot to prevent the country’s rise to its rightful place in the global order. And the opening blows in this trade war come just as President Xi aims to be installed as China’s newest preeminent leader with a status near that of Mao. I don’t know what the retaliation from China will be, but it is unlikely to stop with a few restrictions on how U.S. companies, such as Tesla (TSLA) and Apple (AAPL) operate in China. The situation is so dangerous because it is so uncertain and so open-ended.
AMD gives disappointing chip guidance again
After the close today October 6, Advanced Micro Devices (NASDAQ) announced that its preliminary estimate of revenue for the third quarter would be just $5.6 billion. That’s well below Wall Street forecasts of $6.71 billion.
OPEC+ carries through on yesterday’s leaks and cuts oil production; oil and oil stocks continue rally
Today, Wednesday, October 5, OPEC and its allies, including Russia, approved a two million barrel-a-day cut in oil production. This is the largest cut in production since the onset of the pandemic. Here’s the key paragraph in the OPEC+ statement: “Adjust downward the overall production by 2 mb/d, from the August 2022 required production levels, starting November 2022 for OPEC and Non-OPEC Participating Countries as per the attached table.” On the news, oil and oil stocks extended the rally that began on news leaks yesterday.
Please Watch My YouTube Video: Quick Pick Nvidia
My one-hundred-and-ninetieth YouTube video: “Quick Pick Nvidia” went up today. This week’s Quick Pick: Nvidia (NASDAQ: NVDA). I believe Nvidia will be the dominant chip stock for the next decade–but the stock is struggling during this bear market and the shares were down 58% year-to-date as of September 26. The company has come out with a new line of chips, the GeForce RTX 4000 Series, which offers a 2-4x performance boost over the last generation chip. But in order to get that boost, early reviews indicate, a computer game has to use Nvidia’s DLSS software. Currently, almost no games use DLSS. So Nvidia finds itself in a build it and they will come situation. (“Build it, and they will come,” as James Earl Jones said in Field of Dreams.) Nvidia now awaits the uptake from companies that will be using this chip of the future. Because this product doesn’t “do anything” right now, Nvidia’s upcoming earnings on November 16 won’t reflect this new product. In the short-term, I look for the stock o sell off further on the earnings report. In other words, a better buying opportunity still awaits those who can be patient.
Please Watch My YouTube Video: Quick Pick JO
Today’s Quick Pick: JO (NYSEARCA: JO) otherwise known as Barclays iPath Bloomberg Coffee Subindex Total Return ETN Series B. As I’ve shown you in the video, I’m growing my own coffee plant to head off the coffee shortages we’re seeing now (first beans projected in 2028; enough for a cup? 2032), and will likely continue to see long-term. Brazil is the world’s largest producer of coffee but its inventory is projected to drop to about 7 million bags by March, (well below the comfort level of about 9-12 million bags.) A long-lasting drought is to blame for the shortages–and that dicey weather is likely to be with us for quite a while. Meanwhile, global coffee consumption is going up by 1.5% projected this year (2% last year). While JO is volatile since it trades on the commodity price, what interests me about it at the moment is that it’s NOT correlated to anything else like interest rates or inflation (though it definitely contributes to inflation as coffee drinkers well know.) This ETN will continue to go up, even if the market goes down. (JO is a member of my Volatility Portfolio on my subscription JubakAM.com site.)
Biden announces release of $900 million in funding for electric vehicle charging build out
Wednesday, September 14, President Joe Biden used a visit to the Detroit Auto Show to announce the release of the first $900 million in funding for the buildout of a national network of charging stations for electric vehicles. The funding, part of $7.5 billion in the Infrastructure bill to build out a network of 500,000 charging stations, would go to 35 stations to build charging networks along 53,000 miles of highways. Today, the sector is moving up rapidly with ChargePoint up 8.60% and EVgo up 12.16% as of 2:30 p.m. New York time.
It’s not all bad news for tech stocks: Palo Alto Networks beats, announces 3/1 split, and gains 12%
After the close on Monday, August 22, Palo Alto Networks (PANW) reported fiscal fourth-quarter (adjusted) earnings of $2.39. a share. Analysts had projected $2.28 a share. Revenue climbed 27% to $1.6 billion. The company also announced a 3/1 stock split.
It doesn’t look good in America’s corn fields
Acres that U.S. farmers were unable to plant have more than tripled from the same period last year as extreme weather wreaks havoc on fields, according to the August report from the Farm Service of the U.S. Department of Agriculture. Prevented planting acres–or the acres of insured crops that can’t be planted because of disasters including flooding and drought–stood at 6.4 million. That’s up from 2.1 million in 2021. Prevented planting acres of corn jumped to more than 3 million acres, from 639,000 acres in 2021, according to the USDA. Wheat shot up to more than 1 million acres from nearly 300,000 acres last year. Not surprisingly grain prices have climbed–and so have the prices of commodity funds. The Teucrium Corn Fund ETF (CORN) is up 4.01% today, August 23, as of noon New York time. The ETF is a member of my Volatility Portfolio where it’s down 8.45% since I added it on June 17, 2022. The Teucrium Wheat Fund ETF (WEAT) is up 2.58% as of noon today. That ETF is a member of my Jubak Picks Portfolio. It’s down 27.26% since I added the position on May 25, 2022.
Circle Apple’s September 7 product(s) launch for next big positive for embattled tech sector
If you’re looking for a catalyst to move slumping technology shares higher, circle September 7. That’s the date for Apple’s (AAPL) launch event to unveil the new iPhone 14 line. It’s just one–but the biggest–of Apple’s product launches this fall. The company is expected to announce new Macs, low-end and high-end iPads, and three models for the Apple Watch.
I got these two key China trends wrong: Selling BABA and TCEHY
When I added Alibaba (BABA) to my Jubak’s Picks Portfolio on April 29, 2022, and Tencent Holdings (TCEHY) to my Volatility Portfolio on January 3, 2022, I thought two things were about to happen in China. First, I thought that the People’s Bank would unleash enough stimulus to more than compensate for the slowdown in China’s economy. And, second, I thought that we’d seen the end of the regulatory crackdown on China’s big entrepreneurial technology companies. I got both trends wrong.
Chip makers say tough days ahead–I’m selling TSM and NXPI out of Jubak Picks
The chip boom is over–or at least coming to an end. Gartner has cut its outlook for revenue growth in 2022 to just 7.4%. That’s down from a forecast of 14% growth for chip revenue three months ago. Garner sees chip revenue falling 2.5% in 2023. And you don’t have to take the word of market watchers at Gartner.
Buy/sell/hold: Tesla’s near-term pivot points
The long-term case for buying Tesla (TSLA) is easy to make (or easy to argue.) The company has created electric vehicle technology that delivers faster speeds, longer range, and greater efficiency than any of its emerging competitors. The company has done a superlative job of building out its global supply chain so that it has suffered less disruption due to raw material glitches or chip shortages than any of its competitors. The big long-term questions for Tesla are Can it drive costs out of its production system? and How long will it take for competitors to catch up with Tesla’s technology advantage? (Just for the record I come down on the “buy” Tesla side on these questions.) In the short term the buy/sell/hold case for Tesla is more complicated.
Another chip maker–this time is Micron–warns and chip stock take a hit
First, it was Nvidia (NVDA) cutting its guidance for revenue and earnings due on August 24. Today, August 9, it was Micron Technology (MU) warning that its revenue for the fourth-quarter revenue may come in at or below the bottom end of a forecast range provided in the company’s earnings call on June 30. Micron is scheduled to report on September 27. All this comes as the market is on edge anyway ahead of tomorrow’s report on CPI inflation. As of the close on Tuesday, August 9, shares of Micro Technology were down 3.74%. Shares of Nvidia were down another 3.97% after closing down 6.30% yesterday.
Tesla finally announces date of 3/1 stock split
Finally, on Friday, August 5, in documents filed with the Securities & Exchange Commission Tesla put dates to the split its 3/1 split
What to do about your oil stocks?
I’ve seen several comments on the site asking this question. I assume we’re talking about oil stocks in the short- and medium-term. In the long term, I think it’s clear that you should be thinking about selling these out of your portfolio at a profit (of course) whenever you can. Demand for oil will fall in the long-term–defining long-term as 5 years or more–or we can all count on figuring out how to survive 120-degree (Fahrenheit) heat. Today, August 5, is a good synopsis of what’s going on with oil and oil stocks in the short- and medium-term.
Please Watch My New YouTube Video: Quick Pick First Majestic Silver
My one-hundred-and-sixty-first YouTube video “Quick Pick First Majestic Silver” went up today. This hasn’t been a great year for precious metals hedges. However, allow me to make the case for First Majestic Silver (AG), given the coming recession and my expectations for the Fed’s schedule of rate increases. A hedge for 2023? At the current price, it’s an attractive bit of insurance against a big surge in risk.
Natural gas, corn, and wheat lead commodities higher today
At the close today, July 26, the Teucrium Corn Fund (CORN) was up 2.55% and the Teucrium Wheat Fund (WEAT) was ahead 4.11%. Both of those commodity plays outgained the U.S. Natural Gas Fund (UNG) with its 1.38% move higher. But for consistent gains–and the potential for more–I’d have to say that natural gas is my favorite commodity
Rally or rotation? I vote for rotation
In the last week Technology stocks, and chip stocks in particular, have staged a very impressive rally off of a really low base. Nvidia (NVDA), for example, is up 17.43% in the week that ended on July 21. That still leaves the stock down 39.43% for the year. Advanced Micro Devices (AMD) is up 15.36% in the last week. And it’s still down 37.85% for 2022. Qualcomm (QCOM) is up 1.85% for the week. And down 16.26% for the year. Impressive. But I’d be more inclined to see this as a sustainable rally if stocks were rising across the board–with tech and chips leading the way, perhaps.
Instead what I’m seeing is a rotation from safe and less risky stocks
Remember, natural gas isn’t just for heating; air conditioning demand sends natural gas for August delivery up 10.2% today
There are the base-load power plants that run all the time and meet the bulk of normal electricity demand. And then there are the power plants that are only intermittently called into service when demand spikes. In the United States the majority of the plants used to meet “spiking” demand run on natural gas. So you can imagine what something like the current heat wave now gripping much of the country does to electricity demand for air conditioning and to demand for natural gas.
Selling FXI China ETF out of Perfect 5 ETF Portfolio; replacing with EUM short emerging markets ETF
I’m making a switch today (well, actually tomorrow) in the Perfect 5 ETF Portfolio Out goes the iShares Large Cap China ETF (FXI). In comes the ProShares Short MSCI Emerging Markets (EUM). My weighting remains the same at 15% of the five-ETF portfolio.
Today chip stocks climbed on prospect for Senate vote on $50 billion subsidy bill
The bill, known as the Chips for America Act, is a pared-down version of a broader set of competition measures and would authorize $52 billion in grants and loans for chip manufacturers, as well as a new, four-year 25% investment tax credit for chip making. Senate Majority Leader Chuck Schumer has pressed for a vote today with final passage as early as next week.
Please Watch My YouTube Video: “Two Ideas for Shorting Emerging Markets”
I’m firmly in the negative camp on emerging markets. If you want to profit from the downward move in these markets, I see two options: one is investing in a fund that shorts emerging markets, like EUM. Or, two, you can buy put options on a fund like EMXC (which tracks emerging markets minus China). There are benefits and downsides to each approach.
Adding Invesco Dollar Bullish Fund ETF to three portfolios
In my July 7 YouTube video: “Quick Pick UUP” I added the Invesco DB U.S. Dollar Index Bullish Fund (UUP) to my Perfect 5 ETF Portfolio. (To replace the Consumer Staples Select Sector SPDR ETF (XLP) in that portfolio. More on that in another post today.) Today I’m also going to add this dollar ETF to my Volatility Portfolio and to my Jubak Picks Portfolio. I’m setting a target price of $33.20 in the Jubak Picks Portfolio. You should take the fact that I’m adding a dollar position to three portfolios as an indication of how strongly I feel about a continued strong dollar.
Please Watch My New YouTube Video: Quick Pick UUP Dollar ETF
My one-hundred-and-fifty-fifth YouTube video “Quick Pick UUP Dollar ETF” went up today. In my video yesterday (if you missed it, go watch!) I explained why a strong dollar has hit commodity stocks hard, and why I think the dollar will continue to be strong. One strategy I suggested: Investing in an ETF that tracks the dollar. My recommendation here is Invesco Dollar Index Fund (UUP). I’ll be adding it to my ETF Portfolio on my JubakAM.Com subscription site on July 8.
Please Watch My New YouTube Video: Quick Pick Cheniere Energy
My Quick Pick this week is Cheniere Energy (LNG), a liquified natural gas producer that I currently own in my Volatility Portfolio on JubakAM.com and plan to add to my Jubak Picks portfolio as well. The stock has fallen as U.S. natural gas prices have taken a hit after a fire at the Freeport liquified natural gas facility that has caused a backup in U.S. LNG exports. I think it’s a great time to get in on this long-term story at Cheniere, which just announced that it had given the go-ahead to the construction of a new LNG chain at its Corpus Christi facility. That chain won’t be in operation until 2025 but I see the demand for U.S. LNG continuing to rise through then.
The speculative money is alive and “well” during Bear Market rally days
Friday, June 17, was a modestly up day for most of the indexes. The Standard & Poor’s 500, for example, gained 0.22% and the NASDAQ was up a stronger 1.43%. (The Dow Jones Industrial Average lost 0.13% on the day.) But you’d never know that the indexes were up only modestly if you checked the gains on the most speculative stocks in the market. Meme favorites GameStop (GME) and AMC Entertainment (AMC) were up 7.48% and 6.28%, respectively. But the speculative gains didn’t stop there.
Buying U.S. Natural Gas Fund in my Jubak Picks Portfolio
I’m using the continued weakness in natural gas prices and in the U.S. Natural Gas Fund (UNG) to add the shares to my Jubak Picks Portfolio. The U.S. Natural Gas Fund was down another 5.90% today to close at $23.78.
It’s a war of two narratives–today “recession” narrative replaces “rate cut” narrative and stocks fall heavily
Yesterday, the stock market was up with the Standard & Poor’s 500 gaining 1.46% on the day and the NASDAQ Composite up 2.49%. Listening to the Federal Reserve’s policy statement after the June 15 meeting of its Open Market Committee, Wall Street chose to hear a promise of interest rate cuts as early as the end of 2023 and certainly in 2023. Aggressive interest rate increases in 2022, from this perspective, are just a necessary precondition to those interest rate cuts. Today, the stock market is down with the Standard & Poor’s 500 falling 3.25% and the NASDAQ Composite off 4.08% at the close. The narrative on investors’ and traders’ minds today is the rising odds of a recession–75% odds in favor by 2024 a Bloomberg survey of economists says with 25% odds of a recession in 2023. For a day that trumps the hopes for 2024 interest rate cuts (which would, after all, only materialize if the economy has, indeed, tumbled into recession. I expect this “War of the Two Narratives” to continue for a while
Alcoa Call Options seeing action ahead of July 21 earnings report
I’m seeing a lot of traders buying Alcoa (AA) Call Options ahead of the company’s July 21 earnings report. The action seems to be most concentrated on the $70 October 21 Call at $75. The stock closed at $64.10 today, June 6, up 3.53%. I think the Call Buying is a result of the very big spread in estimates for second quarter earnings with the high estimate at $4.01 and the lost at $3.19. The consensus for the quart is at $3.66. That would be a huge gain from the $1.49 reported in the second quarter of 2021.
Please watch my new YouTube video: Quick Picks Wyndham Hotels
My one-hundredth-and-thirty-fortieth YouTube video “Quick Pick Wyndham” went up today. My Quick Pick this week is Wyndham Hotels (WH), which owns a large portion (40%) of the U.S. market in branded economy and midscale hotels. This is gearing up to be a big summer for travel as the economy emerges from the pandemic, and I think inflationary pressures will “encourage” many consumers who decide to travel to look to save a buck or two on their trips. I will add shares of Wyndham Hotels and Resorts to my Volatility Portfolio on Monday, June 6
EU agrees to partial ban–66%–of Russian oil imports
The European Union has finally found a way to agree on a partial ban on oil imports from Russia. The group has agreed to an immediate ban on imports arriving by sea. That covers about two-thirds of Russian imports. To get Hungary’s vote for the partial ban, the EU agreed to exempt oil transported through the Druzhba pipeline.
Watch Nvidia’s earnings report Wednesday for an indicator of odds of a summer rally
The most important indicator of market direction and sentiment this week will be Nvidia’s (NVDA) earnings report for the quarter that ended in April on Wednesday, May 25. Wall Street analysts and expect earnings of $1.09 a share. Last year Nvidia reported 78 cents for the quarter so hitting the analyst target this year would represented year over year earnings growth of 39.7% That kind of earnings growth is what investors expect from a stock trading at 43.76 times trailing 12-month earnings per share. In a normal market I’d expect traders to bid up the price of Nvidia shares
Palo Alto Networks beats, raised guidance again, gains 10.7% in after-hours trading
I’m actually surprised that shares of cyber-security company Palo Alto Networks (PANW) rose only 10.7% in after-hours trading after the company reported adjusted fiscal third quarter earnings of $1.79 a share. That was ahead of the adjusted earnings of $1.68 a share expected by analysts and it was up from $1.38 a share in the fiscal third quarter of 2021. Revenue of $1.39 billion, up from $1.07 billion a year ago, was ahead of analyst projections of $1.38 billion. Billings rose to $1.8 billion from $1.27 billion in 2021. But the big news, the news that powered the after-hours gains, came when executives at Palo Alto raised their full-year outlook for the third time in as many quarters
Everything EV was up today on news of soaring new registrations
New registrations for electric vehicles jumped 60% in the first quarter of 2022 from the first quarter of 2021. according to Experian Automotive. Electric vehicles made up an all-time record 4.6% of the total market. The news was even more positive given that overall new vehicle registrations were down 18% in the quarter from the first quarter of 2021.
A day after bad news of an economic slowdown in China, officials talk up China’s Internet giants
Today, Tuesday May 17, China’s top economic official, Vice Premier Liu He, said that the government will support the development of digital economy companies and their public stock listings. The comments delivered after a symposium with the CEOs of some of the country’s largest private technology companies came just a day after the National Bureau of Statistics reported that industrial output fell 2.9% in April from April 2021, and that retail sales contracted 11.1%. Financial markets in China and the United States interpreted the remarks as a public show of support for China’s Internet companies
Today it looks more like a bear market rally
In my weekend Saturday Night Quarterback I said that this week would, probably, answer the question of whether Friday’s big bounce was just a bounce, the start of a buy on the dip rally, or even a bear market rally with a bit of staying power. Two days into the week I think the market action is moving in favor of a bear market rally, one of those often quite powerful upside moves that punctuate extended bear markets.
Please watch my new YouTube video: Trend of the week Give ‘Em the Cash
My one-hundredth-and-thirty-second YouTube video “Trend of the Week Give “Em the Cash” went up today. So far, so good this earnings season: oil and natural gas producers are holding the line on capital spending on new production, as they promised, and returning the huge increases in profits from the jump in oil and natural gas prices resulting from the Russian invasion of Ukraine and the sanctions slapped on Russian energy exports. And they’re returning those profits, as promised to shareholders as dividends. Big dividend payouts. Look at Pioneer Natural Resources (PXD), for example, which beat earnings for the first quarter and raised its dividend payout to what amounts to better than 11% annualized. I think we’ll see this trend continue for a while, especially as many CEOs stick to the path of putting fewer resources into new exploration and production because they can’t be sure how long the current level of prices will last.
First Quantum Minerals announces big copper, nickel expansion
With copper and nickel prices near all-time highs and fears that the rapid growth of production of battery-powered cars would result in a severe nickel shortage, on Sunday First Quantum Minerals (FQVLF) announced that t would expand it Kansanshi copper mine in Zambia and begin work on the new open pit nickel Enterprise mine.
AMD reports solid earnings beat after close on May 3
After the close on May 3, Advanced Micro Devices (AMD) reported first-quarter earnings of $1.13 a share, excluding some items. Wall Street analysts had projected earnings of 92 cents a share for the quarter. Sales rose 71% to $5.9 billion, topping projections of $5.3 billion. The results pushed shares up 9.10% in trading on May 4.
Please watch my new YouTube video: Trend of the Week China’s back!
My one-hundredth-and-ninth-eighth YouTube video “Trend of the Week China’s back!” went up today.
At the end of last week, the Chinese government sent signals that it would make moves to stimulate the slowing economy amid widespread lockdowns, as well as letting up slightly in its crackdown on internet companies. This has sent Chinese tech stocks soaring, with multiple percentage-point increases in a few hours. In this video, I look at Tencent (TCEHY), JD.com (JD), Alibaba (BABA) and Meituan (MPNGF) and talk about why this is an important trend to follow, but why we’ll only see these stocks go up in the short term before government pressure sends them back down.
Natural gas prices soar–no summer slump in prices this year thanks to war in Ukraine
Normally at this time of year natural gas prices retreat and companies actually stash natural gas in storage for use durin hurricane outages in the fall and winter heating season. Not this year, however. Today natural gas prices in the U.S. hit a new 18-year high. At 11:20 a.m. New York time natural gas for June delivery climbed to $8.08 per million BTUs, up 8.12% on the morning
Please watch my new YouTube video: Lessons from Amazon
My one-hundredth-and-twenty-seventh YouTube video “Lessons from Amazon” went up today. In this video I’m looking at Amazon’s (AMZN) earnings report after hours on April 28. The company delivered its first quarterly loss in 7 years. The shares closed down 14.05% the next day. I think that the questions Amazon is facing are important across the economy as we emerge from a Pandemic. For example, looking at Pandemic sales trends do you invest in fulfillment and shipping infrastructure to maintain consumer expectations for quick delivery or do you hold back on spending on the likelihood that post-Pandemic trends will revert to lower pre-Pandemic patterns? Amazon’s decision to invest in building out fulfillment, and its flat sales numbers, led to this quarterly loss. Other companies such as Uber, DoorDash, Netflix, Peloton, and Starbucks face the same issues going forward.
Microsoft beats earnings estimates on cloud computing
On Tuesday, April 26, Microsoft (MSFT) reported net income of $16.73 billion or $2.22 share for the company’s fiscal third quarter. That was up from net income of $15.46 billion or $2.03 a share in the third quarter of fiscal 2021. Wall Street analysts had projected earnings of $2.19. The company reported revenue of $49.36 billion in the third quarter, compared with $41.7 billion a year earlier. Wall Street was looking for revenue of $49.05 billion. For the fiscal year that starts on July 1 Microsoft forecast double-digit revenue growth. The company’s shares closed up 4.81% on Wednesday, April 27. Microsoft is a member of my Jubak Picks Portfolio where it is up 179.25% from my initial buy on June 4, 2018. As of April 27 I’m raising my target price on Microsoft to $352 a share from the prior $155.