The PhilStockWorld.com May Money Talk Portfolio Review

Are we weathering the storm?

So far, not so bad as we're down $14,755 from our April Review, when the overall market was 5% higher.  Options tend to be very volatile, of course and the Volatility Index (VIX) is higher now, which inflates the asking price of the options we sold.  This doesn't matter as long as we're not buying them back at the moment, but it can make our balances look ugly.  

Not that being up 125.8% is "ugly", of course, but we were up 155.3% and it sucks to backslide.  Another problem we have at the moment is our hedges certainly don't kick in on a 5% market drop – so they are not helping but, since I can only adjust this portfolio when I'm live on BNN's Money Talk (here's the April show), I needed hedges that would keep us safe all the way into July, which will be the next time I'm on the show (once a quarter it becomes the Phil Show).

Since our longs were on track to make $83,104 in a flat to slightly down market – we don't mind losing a bit of money on our hedges to take us through a rough quarter – like this one.  As I said on the show, we expected at least a minor correction but there's a fear of missing out (FOMO) as this portfolio was only at $88,922 on Feb 15th, so of course we were going to give back some of those ridiculous gains – but that doesn't invalidate our long-term positions, so we choose to ride out the rough spots.  

As FUNDAMENTAL VALUE INVESTORS we believe that stocks – even the ones we like – can be too expensive, as well as too cheap.  When they are too cheap, we buy them – when they are too expensive, we sell them.  It sounds logical but how many traders actually do it when the time comes?  Unfortunately, we can't make adjustments until July but we can certainly check in our our positions – so let's do that.

  • Nasdaq Ultra-Short ETF (SQQQ) - A hedge we


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