Live: Friday, January 17, 2020

3:40 p.m. New York time

RH had started what appeared to be a leg up today, and to preserve gains, I set a tight stop/loss slightly beneath the starting point of the rise. The rise faltered, the stop/loss was triggered, and I exited RH for a $224.06 credit, up $19.53 from entry. the position showed a 9.6% return over 51 days for a 68.3% annual rate.

This is the last day for trading my short iron condor position on XLY. All that’s left, after an adjustment earlier this week, is a short put (bull) spread, which is out of the money and ought to expire without value, the preferred outcome with short spreads.

10:30 a.m. New York time

The Value Portfolio is up for management today, and I added a new position, GPX,

In the Growth Portfolio, TLYS was reduced to a “strong sell” rating by the Zacks algorithm. A stock in the Gene Pool, CDNA, qualified for addition to the Genetics Portfolio, and I bought shares.

As is clear from above, the manage-one-portfolio-per-day rule has broken down as quickly as I adopted it.

So, Plan B:

  • I’ll manage one screened portfolio daily, beginning with Value and then rotating through Growth to Momentum, and then restarting the cycle. This will give a me a diversity in days traded.
  • The pool portfolios — Genetics and Utilities — can be managed on any day, although in a crunch I’ll try to group them with the Value Portfolio, which is low maintenance.
  • Any holding in any portfolio that on any day drops to “sell” or “strong sell” can be managed immediately.

Under this plan, since today was the Value Portfolio’s day, and since Monday is a market holiday, next week’s rotation will be Growth on Tuesday, Momentum on Wednesday, Value again on Thursday and Growth on Friday.

I’ll note in passing that I’m not overly enthralled with the Utilities Portfolio. The stocks don’t produce a lot in capital gains, and the dividends are paid quarterly, which complicates management according to the Zacks algorithm. I’m leaning toward gradually phasing it out.

The Middle East having calmed a bit (or as much as that region ever calms), I’m returning to 20% trailing stop/loss. I won’t go back and change the 10% stops but shall set new positions at the higher percentage.

The morning’s trades:

  • Value
    • Exit
      • TLYS, for an $8.77 credit, down 9 cents from the entry level, producing a 1.0% loss over three days for a -124% annual rate.
  • Growth
    •  Entry
      • GPX, for a $14.96 debit.
  • Genetics
    • Entry
      • CDNA, for a $23.97 debit.

By Tim Bovee, Portland, Oregon, January 17, 2020

Disclaimer

Tim Bovee, Private Trader tracks the analysis and trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment.

No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decisions for his or her own account, and take responsibility for the consequences.

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