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2016 May Update


There was hedging activity as well as investment activity this month. Price histories, adjusted for splits and dividends, were downloaded from Yahoo.


I was careless this month. I bought ARCC put options instead of call options and sold them immediately. Also, I forgot to add to my Real Estate Fund Strategy portfolio.

Comprehensive Strategy investments

Selection list

The selection list was generated before the May 25 market opening.

                                    MERIT    PRICE   GROUP AND END MARKET  
ARCC   Ares Capital Corp             850     15.01  Investments          US
MCD    McDonald's Corp               666    123.95  Restaurants     US/intl
CCI    Crown Castle                  516     91.29  Util, Telecom    US/Aus
CCE    Coca-Cola Enterprises         458     50.99  Beverage, Soft       EU
SPG    Simon Property                439    197.63  Real Estate        intl
HD     Home Depot                    439    133.36  Home Furnish        NAm
MO     Altria Group                  438     63.79  Tobacco Prods   US/intl
RAI    Reynolds American             431     50.70  Tobacco Prods        US
LMT    Lockheed Martin               415    240.97  Aerosp & Def    US/intl
EL     Estee Lauder                  408     92.14  Personal Prods     intl
PM     Philip Morris                 398     98.84  Tobacco Prods      intl
UNH    UnitedHealth Group            378    132.59  HC Plans             US
AZO    AutoZone Inc                  377    760.42  Auto Parts       US/Mex
TJX    TJX Companies                 367     75.24  Retail,Variety  US/intl
NEE    NextEra Energy                364    119.89  Util, Energy     US/Can
STZ    Constellation Brands          362    157.70  Beverage, Hard     intl
KMB    Kimberly-Clark Corp           362    126.76  Personal Prods     intl
TRV    Travelers Cos                 353    113.44  Insurance       US/intl
ROST   Ross Stores                   338     53.36  Apparel              US
AMT    American Tower                337    105.30  Real Estate        intl

Portfolio

I sold LB17C91 because LB developed a downtrend.

Investment exposure was $862,848, including $50,000 for the slated investment, and hedge exposure was $814,380. Closing a hedge would not improve balance.

I bought more ARCC because all stocks were disqualified on the first pass. ARCC, MCD, CCI, CCE, HD, RAI, LMT, EL, UNH, TJX, STZ, and TRV were already investments; MO, PM, NEE, and KMB were in the same group and end market as existing investments; SPG and AMT were in the Real Estate group; and AZO exceeded the price limit. I also disqualified ROST because investors consider it similar to TJX:

                   GROUP AND END MARKET           START            END     
10 LB17C91        Apparel          US/Can   09/25/15  10,516  05/06     494
60 ARCC17P14      Investments          US   05/25/16   5,095  05/25   4,805

                   GROUP AND END MARKET           START        END OF MONTH
500 CCI           Util, Telecom    US/Aus   12/15/14  37,778  05/31  45,405
4800 GPAGF        Packaged Goods  US/intl   09/26/14  49,921  05/31  69,202
60 ARCC18C15      Investments          US   03/28/16   4,315  05/31   3,600
60 ARCC18C17      Investments          US   05/25/16   1,495  05/31   1,440
20 CCE17C50       Beverage, Soft       EU   04/24/15   5,824  05/31   8,200
20 CMCSA18C55     Entertainment      intl   01/25/16  14,564  05/31  23,100
14 EL17C85        Personal Prods     intl   10/23/15  11,079  05/31  14,280
10 HD18C130       Home Furnish        NAm   02/25/16  13,246  05/31  14,600
4 LMT18C220       Aerosp & Def    US/intl   12/15/15   8,567  05/31  11,116
3 MCD17C90        Restaurants     US/intl   12/15/14   2,320  05/31  10,095
10 NI117C45       Util, Energy         US   01/27/15   3,096  05/31   4,800
28 RAI17C38.75    Tobacco Prods        US   02/25/15   7,075  05/31  32,760
14 STZ17C125      Beverage, Hard     intl   08/25/15  18,611  05/31  44,800
14 TJX17C70       Retail,Variety  US/intl   03/25/15  11,457  05/31  13,020
10 TRV18C115      Insurance       US/intl   11/25/15  10,812  05/31   8,300
6 UNH18C135       HC Plans             US   04/25/16   8,845  05/31   8,742

Capital gains, investments

Thousands of US$
  JUN   JUL   AUG   SEP   OCT   NOV   DEC   JAN   FEB   MAR   APR    MAY
                           50     4    -2    -7    13    24   -14     -5

Capital gains, stocks

Thousands of US$
  JUN   JUL   AUG   SEP   OCT   NOV   DEC   JAN   FEB   MAR   APR    MAY
    6    -4    -8   -13                                                 

Capital gains, call options

Thousands of US$
  JUN   JUL   AUG   SEP   OCT   NOV   DEC   JAN   FEB   MAR   APR    MAY
   -7    12    -6    -2                                                 

Comprehensive Strategy hedges

Selection list

The selection list was generated before the May 6 market opening.

                                    MERIT    PRICE   GROUP AND END MARKET  
JMEI   Jumei Intl                    216      6.10  Personal Prods      Chn
TDC    Teradata Corp                 199     26.27  Electron Eqpt   US/intl
VMW    VMware Inc                    148     55.40  Software        US/intl
DANG   E-Commerce China Dangdang     144      7.04  Retail, Special     Chn
DB     Deutsche Bank                 142     16.67  Banks              intl
LNKD   LinkedIn Corp                 141    123.11  Info Servs         intl
BG     Bunge Ltd                     136     60.59  Agriculture        intl
IAC    IAC/InterActiveCorp           132     52.95  Info Servs      US/intl
RL     Ralph Lauren                  131     91.00  Apparel            intl
CAR    Avis Budget Group             129     25.40  Rental Servs       intl
LCI    Lannett Co                    129     19.68  Drugs                US
SLB    Schlumberger Ltd              128     75.40  Oil & Gas          intl
BBBY   Bed Bath & Beyond             128     45.37  Home Furnish     US/Can
M      Macy's, Inc                   126     37.90  Retail,Variety       US
AMBA   Ambarella Inc                 124     38.01  Semiconductors     intl
POT    Potash Corp                   122     16.00  Agriculture        intl
VER    VEREIT Inc                    120      9.39  Real Estate          US
BEAV   B/E Aerospace                 119     47.66  Aerosp & Def    US/intl
CCJ    Cameco Corp                   119     11.60  Basic Matls        intl
NTAP   NetApp Inc                    119     22.82  Electron Eqpt      intl

Portfolio

Investment exposure was $814,210 excluding LB17C91, which was slated to be sold. Hedge exposure was $806,775. Tranche size was $50,000. Adding a hedge would not improve balance:

                   GROUP AND END MARKET           START        END OF MONTH
20 AMBA17P42      Semiconductors     intl   04/18/16  15,124  05/31  14,880
40 CAR17P22.5     Rental Servs       intl   04/18/16  14,480  05/31   6,800
30 CF17P30        Agriculture        intl   04/18/16  11,072  05/31  16,050
120 DB17P15       Banks              intl   04/18/16  19,903  05/31  15,000
20 DISH17P45      Util, Telecom        US   04/18/16   9,704  05/31   7,800
20 IAC17P45       Info Servs      US/intl   04/18/16   8,724  05/31   4,100
60 LCI17P17.5     Drugs                US   04/18/16  21,055  05/31  11,400
20 M17P40         Retail,Variety       US   04/18/16   8,064  05/31  17,600
80 NOV17P27.5     Oil & Gas          intl   04/18/16  27,879  05/31  15,200
20 RH17P40        Home Furnish     US/Can   04/18/16   9,824  05/31  19,800
10 RL17P95        Apparel            intl   04/18/16   8,416  05/31   8,100
80 TDC17P22.5     Electron Eqpt   US/intl   04/18/16  15,671  05/31   7,200
20 VMW17P50       Software        US/intl   04/18/16  12,224  05/31   5,700

Capital gains

Thousands of US$
  JUN   JUL   AUG   SEP   OCT   NOV   DEC   JAN   FEB   MAR   APR    MAY
    5    47    73    29   -90                                 -28     -4

Irregular Strategy

Buying in the Irregular Strategy has ended and the portfolio is empty.

Capital gains

Thousands of US$
  JUN   JUL   AUG   SEP   OCT   NOV   DEC   JAN   FEB   MAR   APR    MAY
  -12     3     1     2    -4    -9    -7     7                         

Real Estate Fund Strategy

Portfolio

                      DESCRIPTION                 START        END OF MONTH
14 IYR17C72     iShares US Real Estate      08/25/15   6,375  05/31  10,150
42 IYR17C76     iShares US Real Estate      10/23/15  18,395  05/31  18,060
33 IYR18C72     iShares US Real Estate      02/25/16  17,359  05/31  27,555
14 IYR18C75     iShares US Real Estate      12/15/15   8,237  05/31   9,100
28 IYR18C76     iShares US Real Estate      11/25/15  15,438  05/31  17,220

Capital gains

Thousands of US$
  JUN   JUL   AUG   SEP   OCT   NOV   DEC   JAN   FEB   MAR   APR    MAY
  -22     9   -15    -8    10    -2     2   -15    -5    35   -10      9

Easy Strategy

Portfolio

The Easy Strategy portfolio was sold because the January Barometer was negative. The proceeds of $119,948 will be reinvested on October 10.

Capital gains

Thousands of US$
  JUN   JUL   AUG   SEP   OCT   NOV   DEC   JAN   FEB   MAR   APR    MAY
                           18     3   -22   -39    -1    35    12