Catch up post from last options expiry sees many Europe banks sold on strong prices. A few more nibbles in uranium.
Portfolio News
In a week where S&P 500 dropped 0.37% and Europe dropped 0.22%, my pension portfolio dropped 1.0%. Drags were ASX stocks with De Grey Mining (DEG.AX) down 5%, Japan, US solar stocks and other alternate energy stocks, and a few sold puts trading lower. Need that spending bill signed into law.
Big movers of the week were NuScale Power (SMR) (96.2%), Arafura Rare Earths (ARU.AX) (51.6%), Stroud Resources (SDR.V) (42.9%), Aeris Resources (AIS.AX) (34.8%), Vulcan Energy Resources (VUL.AX) (27.2%), EML Payments (EML.AX) (26.6%), Northern Dynasty Minerals (NAK) (21%), Premier American Uranium (PUR.V) (20.4%), Resource Development Group (RDG.AX) (17.6%), Global Oil & Gas (GLV.AX) (13.6%), Hercules Silver (BIG.V) (12.3%), American Rare Earths (ARR.AX) (12.3%), DGL Group (DGL.AX) (11.6%), Nihon Denkei Co (9908.T) (11.4%), Macmahon Holdings (MAH.AX) (10.3%), Universal Store Holdings (UNI.AX) (10.2%)
16 stocks on the big movers lists - a bit of a mixed bag but there are some big themes: gold/silver mining (4 stocks), nuclear and uranium (2 stocks), rare earths (2 stocks), lithium (1 stock). While manay commodity prices are down, 2 Australian mining services stocks in the list.
With earnings season coming to an end, attention swings to economic data. Markets make a fresh record midweek and then fall over with a hot inflation print raising fears the rate cuts could be delayed and fewer
Crypto Rising
Will just report the two largest holdings in my portfolios this week
Bitcoin price pushed to a record high and then retreated ending the week 0.8% lower with a peak to trough range of 12.5%
Ethereum price also made a record high but could not sustain the momentum ending the week 6.7% lower with a peak to trough range of 16.6%
Bought
Added a few uranium holdings to personal portfolio to get the holdings up toward 10% of portfolio value
Sprott Physical Uranium Trust Fund (U.UN.TO): Uranium. Closest linkage to spot price.
NexGen Energy Ltd (NXE): Uranium. Largest scale new development scheduled to commence production in 2031.
Enel SpA (ENEL.MI): Europe Utility. Averaged down entry price - will write covered calls on the new tranche only and wait for income to cover the loss to date. Dividend yield 6.74%.
NuScale Power Corporation (SMR): Nuclear Power. Price popped after a long leg downward. Added a holding to average down entry price. See more analysis below
DHL Group (DPWA.DU): Europe Logistics. Assigned on sold put started a few months back. Breakeven of €43.68 is 12.5% premium to €38.80 close (Mar 15). Going to take some time to win that back writing covered calls - no dividends.
FMC Corporation (FMC): US Food Products. Showed a neighbour stock picking screens - walked the talk and bought the stock.
Chart shows price breaking the downtrend and then testing back to the lows to form a W shape. Trade made before $0.58 dividend ex date
QuantumScape Corporation (QS): Battery Technology. Assigned on sold put. Wrote the 6 strike sold puts as price has shown solid support a little below that level.
Cumulative sold put income brings breakeven below that support level
Coty Inc (COTY): Consumer Products. Assigned on sold put. Breakeven after a few months sold puts is $11.23 vs $12.34 close (Mar 15). AAPlus (now TheStreetPro) idea
Sold
A busy options expiry across the portfolios with lots of assignments on covered calls.
Commerzbank AG (CBK.DE): German Bank. 6% profit since January 2024. 4.6% profit since February 2024 in managed portfolio.
Deutsche Bank AG (DBK.DE): German Bank. 14% profit since November 2023
ING Groep (INGA.AS): Dutch Bank. 2.6% loss since Janaury 2024. Not sure how that came about - written too tight.
Banca Monte dei Paschi di Siena S.p.A. (BMPS.MI): Italian Bank. 5.2% profit since February 2024.
Lloyds Banking Group (LLOY.L): UK Bank. 1.6% blended profit since December 2023/January 2024.
SBM Offshore N.V. (SBMO.AS): Europe Oil Services. 2.85% blended profit since July/December 2023. Averaging down helped. Income trades delivered nearly 3 times more profits than the capital profit. Stock screen idea.
Dutch Bros Inc (BROS): US Restaurants. 12.4% blended loss since July/August/September 2022. Income trades delivered an amount of 198% profits to fully cover the capital loss. 6.6% blended loss since June 2022/February/September 2023 in managed portfolio. Averaging down helped. Jim Cramer idea for post covid recovery and a US-based coffee play vs Starbucks facing China declines.
Marathon Oil Corporation (MRO): US Oil. 2.1% blended profit since July/December 2023/February 2024. Covered call income was almost as high as the capital profit.
Norwegian Cruise Line Holdings (NCLH): Cruising. 5.2% blended loss since August 2023/January 2024. Income trades (calls and puts) generated more than 3 times the profits. Revenge Travel idea which has worked quite well overall.
PayPal Holdings, Inc (PYPL): Payment Services. 13.8% blended loss since August 2023. Income trades (calls and one credit spread) covered the capital loss more than 3 times.
In the other maanged portfolios:
Advantage Solutions Inc (ADV): US Advertising. Closed at 52 week high for 57% profit since July 2023 - stock screen idea.
UBS Group AG (UBSG.SW): Swiss Bank. 4% profit since Janaury 2024.
Vallourec S.A. (VK.PA): Europe Steel Products. 2.9% profit since January 2024. Stock screen idea.
Barclays PLC (BARC.L): UK Bank. 5.9% profit since January 2024.
NuScale Power Corporation (SMR): Nuclear Power. Chart shows price falling over from the time the holdings were addeed. The Schumer-Manchin deal was supposed to tbe the catalyst for planned deployment of small scale reactors. That did not happen.
Last month got impatient and wrote covered calls at a tight strike ($4) with price down in the $2 range. That came home to roost and delivered a 45% capital loss. Income trades did claw back 16% of that. Will be working hard to get back to this idea - am a firm believer in the economics of SMR's
ASX Portfolio
No trades - heaps of dividends collected
Shorts
Pfizer Inc (PFE): US Pharmaceuticals. Protective 26 strike put option expired worthless - dripping away some of the profit made on the shoirt trade set up months back in the pension portfolio. In managed portfolio, 29 strike sold put assigned to lock in further 27.5% profit on the short trade
Hedging Trades
Silver prices started to move and took out a lot of silver and silver mining holdings. These are all held as hedging trades - and not sold even when profit taking opportunity arrives.
Coeur Mining, Inc (CDE): Silver Mining. 7.4% blended loss since January/February 2024. Breakeven exit in managed portfolio since January 2024.
Chart shows the challenge of using silver mining as a hedge
Especially when one looks at what is being hedged - S&P500 and 20 year plus US Treasuries.
Agnico Eagle Mines Limited (AEM): Silver Mining. 0.8% blended loss since March/April 2023/January/February 2024. Initial position arose following merger with Yamana Gold. Income trades (mostly calls) covered the capital loss by nearly 8 times.
Pan American Silver (PAAS): Silver Mining. 20% blended loss since January/March/May 2023. Income trades (70% calls) covered 78% of the capital loss
iShares Silver Trust (SLV): Silver. 0.19% loss since July 2023. Income trades coverd this loss 28 times over.
The ETF provides the simplest hedging instrument as it has less volatility than the silver mining stocks with 8 months of income trades without an assignment.
Expiring Options
iShares MSCI Emerging Markets ex China ETF (EMXC): Emerging Markets Index. With price closing at $56.76 (Mar 15), 52/55/50 call spread risk reversal expired in-the-money. The assignment and exercise on the call spread produced a 5.77% profit on stock transaction. Add to that the option premium added another 26% to the profit pool - the call spread was fully funded by the sold put.
Chart shows price dropping below sold put (50) level in the first few weeks and then driving upwards with two of the blue arrow size price moves. With 2022 highs another $5 higher, there is scope to make another trade like this - say with sold put at 52 level. A 60/63/54 would have a positive net premium of $0.76 - could widen the call spread to 65 and still have a positive net premium.
Cryptocurrency
Fantom (FTMBTC). Closed out at 50% profit target since January 2024. Fantom is proving to be a solid trading coin with trades running 2 to 3 monhts to make 50% return. Still some way to go before the initial 2022 entry is covered
Income Trades
43 covered calls went to expiry with 12 assignments across 3 portfolios UK 1 (1) Europe 11 (5) US 32 (6). In the week 8 new covered calls written (Europe 2 US 6)
13 naked puts went to expiry of which 3 went to assignement (UK 1 (1) Europe 7 (1) US 5 (1))
One new naked put written
Lloyds Banking Group (LLOY.L): UK Bank. Return 1.96% Coverage 5.3%
8 credit spreads went to expiry all without assignement with a tidy ROI of 42.2% in pension portfolio and more moest 14% in managed portfolios.
Wrote one new naked put on Coeur Mining (CDE) well out-the-money
ResourcesCautions: This is not financial advice. You need to consider your own financial position and take your own advice before you follow any of my ideas
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March 11-16, 2023