While the bears may be celebrating the dip in the market this week, let’s keep in mind that we are still on a very positive trend that will take more than a few days to break. The more bearish you are, the more you need to treat these dips as an opportunity to hedge something and the stocks we’ve selected for the Watch List are purposely stocks that we don’t mind sticking with through thick and thin because they provide exceptional value AND good income-producing opportunities through dividends and option sales.
Our new Watch List is only 2 weeks old but is already performing very well with 10 of our 13 positions winning already, and that’s not even counting the buffer we get from our hedged entries. 2 of the 3 losers were knocked out of winning positions on yesterday’s dip – it’s all about timing! Still, great progress but not so much so that some of the positions can’t still be entered, I highlighted my comments at the end of each trade as to whether or not I still like them.
When I put up the list, I said:
The following stocks are from a list of stocks I feel are STILL undervalued and generally have not run up too much in the past year. These are not the popular names, mainly they are stocks that are under the radar and many are thinly traded so this is a members only list – keep in mind our own buying can move these stocks so chasing is not advised. Fortunately, with the buy/write strategy, we just need to get the right NET entry to initiate a position.
Even as great as these picks are, let’s be cautious as nothing will survive a huge market sell-off intact and that’s still a very real possibility. My top concern remains that Christmas will be a disaster for Retailers and that will begin a cascading failure that hits the REITs and the banks but, since that’s not going to happen for another 75 days – why not party with the market for now?
Now we have 60 days left to see how my macro prediction plays out but let’s see how our individual choices are going and if there are still new entry opportunities:
AGNC (10/8 $27.61 (net $21.61/23.30), 10/24 $28.02) – March $25 puts and calls are now $5.70, net $22.32, which puts us up 3% so far. This position is better entered new if we have a big sell-off, $26 would…
