Indices closed UP on weekly option expiry. Indices struggled most of the day but closed mid range.
S&P 500 @ 1761.64, high 1765.67
RSI @ 64.06
CMF @ 0.288
Internals were :
UP volume led by 1.22 to 1 in NYSE & 1.03 to 1 in Nasdaq
Declining stocks led by 1.23 to 1 in NYSE & 1.39 to 1 in Nasdaq
Net new 52 wk highs were leading by 69 in NYSE & 41 in Nasdaq
VIX Down 3.42% @ 13.28
Oil @ $94.61
Gold @ $1313.20
Canadian $ @ 95.57
Green close included JKS QIHU YY NFLX TSLA YHOO
CSIQ EXPE CMG YUM MA V YNDX FSLR SPWR
GRPN RVBD BRCM TCK MCD X STLD LCC
MGA MS WLT Z WYNN GS AGU.....
Portfolio weighting :
AMZN 27.03%
JKS 21.34%
LNKD 19.89%
MU 16.24%
FNSR 15.50%
Exposure 192%
Next post by 2 PM Sunday
BLOG does NOT give buy or sell.
Saleem
3 comments:
Hey Saleem,
After another well-underperforming week where the portfolio lost 2.28% versus the S&P's +0.11%, the winners and losers shape up like this:
Notable Winners: YY (+6.8% from purchase), TRLA (+4.1% upon sale), WUBA (+3.6% from purchase), YELP/LCC/RALY (+1-2%)
Notable Losers: SODA (-15.7%), CSOD (-8.7%), CLDX (-8.2%), BIDU (-3.3% from purchase), FB (-2.8% buy/sell), X/AAPL/KORS (-2-1%)
YTD Info:
Portfolio: +50.58%
S&P 500: +23.52%
There isn't much "story" to this week as I just made positioning moves pre- and post-earnings on some companies to try and maximize future returns. Here's the current portfolio:
Highest Weightings (12.3-11.2%): AAPL LCC CSOD KORS
Middle Weightings (9.9-9.3%): YELP BIDU RALY
Lowest Weightings (7.4-5.0%): YY SODA WUBA CLDX
New: YY BIDU YELP WUBA
Adds: CSOD
Sells: OMED X FCX TRLA
Trade: FB
I didn't classify the positions as "core"/"speculative"/etc. this week because, in looking, the weightings didn't necessarily correlate to my confidence in them.
I've been thinking a lot this weekend about my poor performance in recent weeks. Although I'd attributed it to the lower 10-yr Treasury giving high-yielding stocks the money flows instead of high growth stocks, I didn't expect this much weakness in some of my key names. U.S. economic uncertainty in the wake of the government shutdown and debt ceiling debate certainly weighed on many of the growth names in the past month, but with some stronger data coming recently, I would have expected better performance out of the small cap names in general. The $RUT put in a very poor showing last week being down 2.03%.
This kind of makes the next two weeks "make or break". If the weakness was simply related to low 10-yr yields and a perceived/true lull in the US economy, then by the middle of the month, we should see the last of that poor October data, and yields should be creeping higher again. So, through better economic strength and the historical pattern of small caps into a year-end, we should definitely see the small caps accelerate through November and December. If this rally fails to materialize, I will have to accept that something else is wrong.
This week sees another round of earnings. Portfolio names of CSOD (Mon PM), KORS (Tue AM), and YY (Wed AM) lead the charge, with watch list names of CF (Mon PM), Z/TSLA (Tue PM), CSTE (Wed AM), PRU (Wed PM), WLK (Thu AM), and MNST (Thu PM) also reporting. I am highly confident in CSOD's earnings (although what reaction will we see?) but more cautious on KORS due to some apparel weakness (not enough to sell though). YY is a bit of a wildcard, but I think the overall growth there is spectacular and I am willing to keep a position into the numbers.
The most disturbing case against the bull market is the sentiment shift with the Investor's Intelligence survey showing the lowest bearish reading in over a year. Interestingly, following that reading (taken on Tuesdays), the market fell both Wednesday and Thursday before recovering some Friday. The mid/late week weakness in the small caps might also be contrarianly-related to that extremely bullish sentiment reading. I suspect we worked off some of that excess bullishness already, and I also think the seasonal pattern might stave off any real correction through the end of the year.
I sold off the rest of my commodity exposure this week as I believe they are due for a rest or maybe a decline. With the US economy breaking through the October weakness, I think we're headed for a stronger dollar, thereby hurting commodities. Together with this though, I think US oil output is steadily increasing leaving little room for upside. I also think China may have peaked in its purchase of commodities this mini-cycle as they will try again to implement economic reforms for the future, hopefully on a footing of stronger underlying growth.
I have purchased quite a few Chinese social/internet names in recent weeks. It seems to me that if we call 2013 the year of the US social/internet boom, 2014 might be the year of the Chinese social/internet boom. Given their vast population, yet underdeveloped social/internet monetization, it seems to me the ramp potential for Chinese stocks is much larger than their US counterparts. One hitch in this thesis is the ongoing skepticism about Chinese financials. Encouragingly though, it seems that after short scares, the market is able to differentiate between the real market leaders and the fake companies. I look forward to following this idea through 2014.
In summary, I am optimistic about the direction of US growth and growth stocks. If the market averages struggle due to a higher 10-yr, I look for the growth stocks to outperform. I hope this includes my batch of stocks also, but am prepared to re-evaluate should a rally in my stocks not materialize soon. Earnings this week will dominate my board with key economic data important, but backward-looking.
Good luck to all into the “holiday” months! :)
Stocktrader
Hi Stocktrader,
We learn "more from under performance" than from doing well...it brings the-best analysis as to why.....
Big earnings are out of the way.
Good luck with your earnings play.
Saleem
Post a Comment