Stock Trading

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sweetandsour
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Post by sweetandsour »

One of the things I enjoy about the morning briefings sponsored by the brokerages are some of the questions asked. It seems that someone will frequently ask about a stock that I've never heard of, and yesterday someone asked about one that neither of the analysts hosting the call had heard of, or at least were familiar with. Someone asked about EXR, "Extra Space Storage, Inc", a real estate investment company specializing in self storage units. There's a stock for just about everything, I'm thinking, but EXR employs over 4000 people, had revenue >$1B in 2021, and a stock price of ~200.

Not as much volatility to keep an eye on as NVDA though, which is getting back into the buy range again.
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Post by Del »

sweetandsour wrote: 31 Aug 2022, 04:00 One of the things I enjoy about the morning briefings sponsored by the brokerages are some of the questions asked. It seems that someone will frequently ask about a stock that I've never heard of, and yesterday someone asked about one that neither of the analysts hosting the call had heard of, or at least were familiar with. Someone asked about EXR, "Extra Space Storage, Inc", a real estate investment company specializing in self storage units. There's a stock for just about everything, I'm thinking, but EXR employs over 4000 people, had revenue >$1B in 2021, and a stock price of ~200.

Not as much volatility to keep an eye on as NVDA though, which is getting back into the buy range again.
Investors have been interested in the self-storage niche for a while now. Robert Kyosaki ("Rich Dad, Poor Dad") was talking about it over 20 years ago. He liked buying or developing actual storage lots and hiring people to manage them.

Then sell-storage became a niche sector of the REIT market ("real estate investment trusts"). And rather lately, some of these are traded on the stock market. Basically, you are buying the real estate plus the cash flow from the rental operation. The real estate value will ebb and flow with that market, while the cash just keeps flowing in. Self-storage does very well during economic downturns.

This is full-on "Value Investing" -- the polar opposite of "Growth Investing," which is the style of those sexy tech stocks. Financial planners like to put retiree money here. Low volatility, steady growth, high dividend yield. A great candidate for the little old lady who wants to get a check every quarter and watch her balance go up a bit most of the time.

I just took a glance at EXR compared to Exxon (XOM), as energy is another value-class investment.

I'd still much rather own the oil company. Much lower P/E ratio. Lots more cash flow per share. Much higher dividend payout. Much higher potential for growth.
The difference is that an oil company has volatility risks due to world market price flux on crude, also regulatory risks from stupid autocratic dictators -- and not just Biden.
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Post by Del »

It's Wednesday morning, and it's already been a long week for the market. (My condors expire on Wednesdays, so it has been a very long week for me.)

It's the end of the month. Time to review my trading portfolio and see what I've learned.

Balance and performance:
My trading account started year at $23,500. Currently $30,600. $7100 gain. 30% return, YTD. Average 3.75% per month.

A successful trader expects 3% to 5% per month on total portfolio. I've been at this for five years.... this is the first year that I have achieved this target.

I have a history of losing all my gains during autumn volatility, so I am going to proceed cautiously from here. 30% is good enough already, and I still expect my oil positions to add value by year end.

Market
Big correction at the end of summer now as Mr. Market absorbs the risk of global recession without any safety net offered by the US Federal Reserve. SPX is at 4000 right now, eyeing that mattress of strong support at 3900 which we talked about last May.

NVDA
Trading at $151. Just want to congratulate Tim again for bailing your position at $191. You cut your losses at the top of a swing. Well played!

Copper
This has been a bust. I am down $750 on this position today.... sudden drop due to global recession fears. I expect it will recover somewhat by Sept 16 when my calls expire. I will assess and likely close the position, hopefully with a loss less than $500.

Oil & gas
New position. After 10 calendar days, I remain pleased with my positions in XLE and DRLL. They weathered the market clobbering of last week and trade close to my entry points. I will evaluate setting some protective stops on this asset. If the bottom falls out of the market, I can save some bacon and buy back at a lower price. The fundamentals on this sector are very strong.

In my retirement fund, I moved out of Vanguard Total Index (VTI) and bought DRLL on Aug. 24.
At this moment, after enduring severe market correction --
DRLL - position down $6020
VTI - position down $16,890
Net gain on portfolio - $10,870

Sectors that lose the least during a downturn usually gain the most in recovery.

Iron Condors on Russell 2000 Index (RUT)
This has been my workhorse investment. YTD profits $5700.

Let's update my table of performance in recent weeks:

Week ending; profit/loss:
7/6 $693
7/13 $1194
7/20 $1073
7/27 $-1614
8/3 $1071
8/10 $1328
8/17 $934
8/24 $80
8/31 $1405

Violent volatility the last two weeks has forced me to make expensive adjustments and take on excessive risk. I have a tendency to double-down (martingale) under adverse conditions. This doubles my risk, and a second big movement could blow up my account.

Investing in condors is like sailing in a small boat. When the water gets too rough, it is best to head into port and wait for calmer weather.
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Post by Del »

SPX has hit the mattress at 3900.
Tomorrow (Friday), the latest unemployment stats will be released. Mr. Market is praying for higher unemployment than expected, hoping that this will get the Fed to ease off on raising rates quickly. Mr. Market will be disappointed, and the guru at Fidelity will probably see 3800 next week, as predicted.

We'll see if Mr. Market has fully adjusted to expectations of a long (and hopefully not-too-deep) recession.

Hey Tim -- does your trading platform allow you to draw date lines and support lines and diagonal lines on your charts? If it does, then draw a diagonal line on SPX. Start at the top of candle on 8/19, and trace down along the bottoms of the candles for the last 5 days. Extend it into the future a bit. Then let's talk about it.

RUT and XLE are showing similar channel support. The market in a controlled slide, not a scary free-fall.
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Post by sweetandsour »

Del wrote: 01 Sep 2022, 09:07 SPX has hit the mattress at 3900.
Tomorrow (Friday), the latest unemployment stats will be released. Mr. Market is praying for higher unemployment than expected, hoping that this will get the Fed to ease off on raising rates quickly. Mr. Market will be disappointed, and the guru at Fidelity will probably see 3800 next week, as predicted.

We'll see if Mr. Market has fully adjusted to expectations of a long (and hopefully not-too-deep) recession.

Hey Tim -- does your trading platform allow you to draw date lines and support lines and diagonal lines on your charts? If it does, then draw a diagonal line on SPX. Start at the top of candle on 8/19, and trace down along the bottoms of the candles for the last 5 days. Extend it into the future a bit. Then let's talk about it.

RUT and XLE are showing similar channel support. The market in a controlled slide, not a scary free-fall.
Yes, I use Charts + on Fidelity. Been watching SPY, and had a limit order to buy at 390 that I forgot about, which it hit today, and is at ~391 at the moment. The diagonal that you're talking about, on the SPY chart extends down to roughly ~375. The few shares of XLE I bought to hold for a while, expecting to possibly do covered calls (that's another story), is at ~78, down from 81 - it doesn't move much but it may if certain things happen.

I played 18 holes of golf this morning, and one of the guys still has his NVDA and had been selling calls on it. I see that it's at 135 at the moment, the lowest I've seen it this year, or since I've been watching it anyway. So, at the moment I'm just sitting and keeping an eye on things, after lunch I have a regularly scheduled Drs appointment, then work on my grandson's zero turn mower. I haven't looked at our IRA with Ameriprise all week to see what it's doing. Ain't retirement fun?
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Post by Del »

sweetandsour wrote: 01 Sep 2022, 10:29
Del wrote: 01 Sep 2022, 09:07 SPX has hit the mattress at 3900.
Tomorrow (Friday), the latest unemployment stats will be released. Mr. Market is praying for higher unemployment than expected, hoping that this will get the Fed to ease off on raising rates quickly. Mr. Market will be disappointed, and the guru at Fidelity will probably see 3800 next week, as predicted.

We'll see if Mr. Market has fully adjusted to expectations of a long (and hopefully not-too-deep) recession.

Hey Tim -- does your trading platform allow you to draw date lines and support lines and diagonal lines on your charts? If it does, then draw a diagonal line on SPX. Start at the top of candle on 8/19, and trace down along the bottoms of the candles for the last 5 days. Extend it into the future a bit. Then let's talk about it.

RUT and XLE are showing similar channel support. The market in a controlled slide, not a scary free-fall.
Yes, I use Charts + on Fidelity. Been watching SPY, and had a limit order to buy at 390 that I forgot about, which it hit today, and is at ~391 at the moment. The diagonal that you're talking about, on the SPY chart extends down to roughly ~375. The few shares of XLE I bought to hold for a while, expecting to possibly do covered calls (that's another story), is at ~78, down from 81 - it doesn't move much but it may if certain things happen.

I played 18 holes of golf this morning, and one of the guys still has his NVDA and had been selling calls on it. I see that it's at 135 at the moment, the lowest I've seen it this year, or since I've been watching it anyway. So, at the moment I'm just sitting and keeping an eye on things, after lunch I have a regularly scheduled Drs appointment, then work on my grandson's zero turn mower. I haven't looked at our IRA with Ameriprise all week to see what it's doing. Ain't retirement fun?
XLE has recovered today to some beautiful support near 78.5, a support level established as early as last March or before, and re-established many times since. It doesn't want to go down any further.
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Post by Del »

I'm still going to sell iron condors. I'm just going to reduce my position size, so that even when I double-down on positions, I don't have more than $6000 at risk.

I read a news article today about whether or not SPX might break through the "critical support level of 3900." I'm glad to see the pros agreeing with my "mattress."
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Post by sweetandsour »

Del wrote: 01 Sep 2022, 10:58
sweetandsour wrote: 01 Sep 2022, 10:29
Del wrote: 01 Sep 2022, 09:07 SPX has hit the mattress at 3900.
Tomorrow (Friday), the latest unemployment stats will be released. Mr. Market is praying for higher unemployment than expected, hoping that this will get the Fed to ease off on raising rates quickly. Mr. Market will be disappointed, and the guru at Fidelity will probably see 3800 next week, as predicted.

We'll see if Mr. Market has fully adjusted to expectations of a long (and hopefully not-too-deep) recession.

Hey Tim -- does your trading platform allow you to draw date lines and support lines and diagonal lines on your charts? If it does, then draw a diagonal line on SPX. Start at the top of candle on 8/19, and trace down along the bottoms of the candles for the last 5 days. Extend it into the future a bit. Then let's talk about it.

RUT and XLE are showing similar channel support. The market in a controlled slide, not a scary free-fall.
Yes, I use Charts + on Fidelity. Been watching SPY, and had a limit order to buy at 390 that I forgot about, which it hit today, and is at ~391 at the moment. The diagonal that you're talking about, on the SPY chart extends down to roughly ~375. The few shares of XLE I bought to hold for a while, expecting to possibly do covered calls (that's another story), is at ~78, down from 81 - it doesn't move much but it may if certain things happen.

I played 18 holes of golf this morning, and one of the guys still has his NVDA and had been selling calls on it. I see that it's at 135 at the moment, the lowest I've seen it this year, or since I've been watching it anyway. So, at the moment I'm just sitting and keeping an eye on things, after lunch I have a regularly scheduled Drs appointment, then work on my grandson's zero turn mower. I haven't looked at our IRA with Ameriprise all week to see what it's doing. Ain't retirement fun?
XLE has recovered today to some beautiful support near 78.5, a support level established as early as last March or before, and re-established many times since. It doesn't want to go down any further.
Boy did it (SPX) bounce.

I had a limit order for SPY at 390 and it was filled today, although at a glance, the reported low was roughly 391. Who cares - I'm in and it ended the day at 396+. Tomorrow is the beginning of a holiday weekend so I don't expect I will be leaping into anything else as far as buying.

One pleasant surprise, I received a phone call from our financial advisor's office today, just checking on us. They (she) asked if there was anything we needed at the moment, and I replied that a little lower fees would be nice. I think she thought I was joking.
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Post by Del »

sweetandsour wrote: 01 Sep 2022, 18:57 Boy did it (SPX) bounce.

I had a limit order for SPY at 390 and it was filled today, although at a glance, the reported low was roughly 391. Who cares - I'm in and it ended the day at 396+. Tomorrow is the beginning of a holiday weekend so I don't expect I will be leaping into anything else as far as buying.

One pleasant surprise, I received a phone call from our financial advisor's office today, just checking on us. They (she) asked if there was anything we needed at the moment, and I replied that a little lower fees would be nice. I think she thought I was joking.
My chart says that SPY low was 390.04. You caught a loose thread on its sock!

There were three surges this afternoon -- at 12:30, 1:30, and 2:50.

Let's hope it consolidates above 390 and starts to climb out. Don't be surprised if it drops in the morning with the latest employment data. It could climb out by afternoon. The bulls are starting to show up.
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Post by Del »

The employment news is favorable. Unemployment is a smidge higher than expected. Wage inflation is a smidge lower than expected.

Not enough to change reality at all, but also nothing to tempt bears into testing support at 3900.

Computer traders pushed SPY up to 400 in pre-market. Looks like SPY will open somewhere 399.

You've had a couple of really great trades. Catching SPY at 390 and selling NVDA at 191 (currently 140.5). Golly!
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