TSM 0.00%↑ reports tomorrow pre-market and that name has been a gem in our fund and client portfolios all year. I talked about it here.
So, why the sell ahead of earnings? Sometimes you just have to book gains is the simple answer and the gains on that with the equity and options positions were just too big to not take. Also (and not sure if this makes sense but will try to explain) we run portfolios of many long/short ideas - so I’m not always dependent on one idea to make money - I find this beneficial from a risk perspective but also from the emotional perspective because you don’t have to tie your hopes and dreams to one idea; you can be agnostic to the positions.
That’s a look at the FOPT model/framework for portfolio construction above - so in short, I am not dependent on one idea so selling TSM 0.00%↑ and booking is okay and I can always get back in (or not) because there are other long/short ideas in the book and some that are being monitored.
I hope this makes sense for the readers here who are more than just momentum trading small accounts because it should help in many ways to use something similar.
Boeing
Look, I’ve been on the fence with this name all year primarily because of the issues it’s had and I’ve tracked it. For the first 6 months this year their operating cash flow was negative to the tune of nearly $7B - not good but then again who else is going to come and make planes aside from them and Airbus? That’s the weird conclusion I’ve come to….How much worse can the price of the stock get at this point? They are going to have to issue more shares and debt - maybe up to $25B according to Reuters here.
So, with that a know, the stock is holding up and I took a position today. Not investment advice and it is through options structures no the shares.
Pre-Market Momentum Check
For those of you that read this blog and use the Momentum Monitor I’ve made it a point to make more videos for you and see if we can grow a channel on YT just dedicated to that.
This is a simple process that I’ve used daily for +15 years. There are no ice baths, meditation routines or other nonsense - it’s just a simple check to understand what the sentiment/momentum on the day (if you’re a momentum trader) is going to do.
Please like and subscribe to this channel and share it with your friends.