Model Portfolio Update

I think gold is ready for another leg up after reacting positively to Janet Yellen’s inane speech in Jackson Hole, Wyoming. Adding a 5% position in leveraged junior gold fund JNUG at $22.83 a share.

Reminder I am not a legal financial adviser according to the government, so I’m not actually saying anything or recommending anything and I’m warning anyone considering not to listen to anything I say about investment.

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Model Portfolio Home Run and Gold Update

I took the model portfolio to 10% leveraged positions on June 16 in gold and silver. They paid off this week. We will sell on the next big up day and put the money back into unleveraged positions and very battered very cheap post Brexit European bankster banks.

NUGT, the 3x leveraged gold miners fund, is up 31.5% since we bought it.

USLV, the 3x leveraged silver fund, is up 40%.

These funds are dangerous and shouldn’t be held for too long.

Disclosure for legal purposes: I own NUGT and USLV. And I am not recommending anyone do anything since the government says I am not a financial adviser.

As for gold, it has, for the first time since crashing in April 2013, broken through the 200 week moving average, and inflation isn’t even high yet. When inflation exceeds 5%, you will see the metals go up faster than you can imagine. Once inflation becomes obvious, we’ll see a quick trek to $5,000 or more, probably before 2020.

Model Portfolio Update

For anyone who has been following my trading game, the model portfolio is way up. See the model portfolio page on the menu bar. I closed the SPY call option position for a small loss. The contracts expired in the money, but not enough so, so we took a $480 loss. I added one contract of SRPT January 20, 2017 $50 CALL for $190. The big FDA decision on Eteplirsen is due in 10 days, and there is a chance it will be approved. If it is, that contract will become much more expensive.

Since everyone is focusing on options expiring next Friday since the FDA decision will be in by then, the longer dated calls are at a significant discount, so I bought one.

Total notional gains for open positions in the model so far are $19,000 flat plus realized gains from closed positions of $2,480, for 21.5% gains so far. Each individual position is as follows.

Portfolio began 9/21/15.

Open Positions As of January 5, 2016

$5,000 QQQ at $99.97/share – ADDED 1/20/2016, current gain $341.

$9,000 CVX at $76.97/share w/5% dividend – ADDED 1/20/2016, current gain $2,938.

$500 GLD JAN 2017 225 CALL  @ $0.13/contract  – current loss $154

$10,000 CORR at $25.80/share w/9% dividend – current loss $1,143

$10,000 CORR at $15/share with 17.7% dividend – ADDED 12/29/15 – current gain $5,220

$500 TLT JAN 2017 $95 PUT @ $3.00/contract – current loss $500

$30,000 GG at $13.40/share w/1.1% dividend – current gain $11,574

$10,000 POT at $17.80/share w/8.54% dividend – ADDED 12/29/15 current loss $1,033

$10,000 888.L at $2.72/share (183.5 pence) – ADDED 12/29/15 current gain $1,757

$190 SRPT Jan. 20, 2017 $50 CALL – ADDED 5/16/16

$17,330 CASH

Total notional gains $19,000 flat

Closed Positions

$20,000 CVX at $78/share w/5.5% dividend – SOLD 10/8/15 AT $89.72/SHARE FOR $23,000

$3,000 SPY APR 15 2016 203 CALL @ $5.95/contract – CLOSED 4/15/16 FOR $2,520

TOTAL As of May 16, 2015 – $121,480.

Total realized gain 2.48%, Total notional gains 19%.

Rounding down for commissions.

Additional information: This is a game, and I am making no recommendations.

Model Portfolio Change

After yesterday’s drop I have added a position to the model portfolio. $3,000 worth of SPY April 15 2016 calls at a strike of $203. Check the model portfolio page at the menu bar.

There is no reason for stocks to fall so hard now, as the money supply is expanding rapidly. This will be reversed in a few days, if not today and we should be able to sell the calls for a quick profit sometime in late January or early February.

The reason I picked the $203 strike is that it has the least open interest in near the money contracts, meaning the lowest amount of people trading it. That generally gives it a discount over other strikes as the demand is lowest.

I always go out a little farther than I plan to sell them in case my timing is off. It’s worth it to pay the extra time premium rather than rely on impeccable timing which I almost never have.

NEW INITIATIVE: Imaginary Stock and Options Portfolio

Let’s try this out. I’ve called the Macau top, the China top, the Japan top and the VIX spike. I think the gold bear is finally over. I’ll go up against all the Keynesian hedge fund guys who know nothing about business cycles.

Here’s my model portfolio, assuming a $100,000 portfolio. This is only a game, and I am not making any recommendations. I advise you not to follow any of this, because I am covering myself for legal reasons.

$500 GLD JAN 2017 225 CALL  @ $0.13/contract

$10,000 CORR at $5.20/share w/9% dividend

$500 TLT JAN 2017 PUT @ $3.00/contract

$30,000 GG at $13.40/share w/1.1% dividend

$20,000 CVX at $78/share w/5.5% dividend

$39,000 CASH

I’ll make a page out of this thing and update monthly and with any changes.