The following are this week’s Low Cost Put Hedge Selections and the results for the previous week’s Open Positions. Each week, if conditions warrant one or more new stock positions are added to the Open Positions list. These stocks have a Bullish technical Opinion from Market Edge. The stocks and option spreads are added to the portfolio based on Monday’s opening prices. The stocks are removed from the portfolio after twelve weeks or if the Market Edge Opinion is downgraded from Bullish. To access The Low Cost Put Hedge informative booklet click on the Get The Booklet tab located on the home page or at the bottom of this page.
This Week’s Low Cost Put-Call Hedge Selections
There is one new selections this week: DE
| Market Edge Opinion:Though the technical outlook remains somewhat mixed there are signs that point to an improved outlook for the stock. Several of the pertinent indicators have turned positive and the stock appears to be under accumulation. Should the stock break above recent resistance numbers it could mark the beginning of a new uptrend. The stock is underperforming the market over the last 50 trading days when compared to the S&P 500. DE’s chart formation suggests an upward trend is beginning/ stock is in the early stages of a rising trend. A close above $146.31 is a number to watch to confirm a trend reversal. Over the last 50 trading sessions, there has been more volume on up days than on down days indicating that DE is under accumulation, which is a bullish condition. The 50-day moving average is pointed up but the stocks is trading below this important resistance level. A move above this would further validate the improving technical condition. A move in price above the 200-day moving average will add to the improving technical condition of DE.
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Current Open Positions
| Market Posture: | Bullish | VIX–> | 12.18 | Bearish | ||||||
| Stock Price Is Monday’s Opening | * After Symbol Denotes Short Stock Position | |||||||||
| Long | # Of | Stock | S-Put | L-Put | Credit | A-Put | A-Put | A-Put | Approx | Approx |
| Stock | Weeks | Price | Strike | Strike | Spread | Ex. Date | Strike | Debit | Div Date | Dividend |
| XLE | 11 | $75.11 | 76.0 | 75.0 | $0.30 | 07/20/18 | 175.0 | $2.43 | None | $0.00 |
| LULU | 10 | $125.96 | 126.0 | 125.0 | $0.43 | 09/21/18 | 100.0 | $8.45 | None | $0.00 |
| HSY | 9 | $92.68 | 95.0 | 94.0 | $0.39 | 08/17/18 | 95.0 | $5.30 | None | $0.00 |
| PYPL | 9 | $87.78 | 85.5 | 84.5 | $0.38 | 08/17/18 | 82.5 | $4.85 | None | $0.00 |
| SWKS | 8 | $100.29 | 100.0 | 99.0 | $0.42 | 08/17/18 | 100.0 | $5.30 | None | $0.00 |
| UTX | 8 | $130.12 | 126.0 | 125.0 | $0.34 | 08/17/18 | 125.0 | $3.50 | None | $0.00 |
| PEP | 7 | $112.50 | 108.0 | 107.0 | $0.40 | 08/17/18 | 100.0 | $2.50 | None | $0.00 |
| V | 6 | $138.55 | 135.0 | 134.0 | $0.44 | 09/21/18 | 135.0 | $4.90 | None | $0.00 |
| LOW | 3 | $98.90 | 96.5 | 95.5 | $0.37 | 10/19/18 | 95.0 | $5.28 | 07/24/18 | $0.48 |
| EW | 2 | $148.56 | 148.0 | 147.0 | $0.39 | 11/16/18 | 145.0 | $8.60 | 07/24/18 | $0.48 |
| DE | 1 | $135.89 | 96.5 | 95.5 | $0.37 | 09/21/18 | 135.0 | $5.75 | None | $0.00 |
Model Portfolio – Track Record
The performance figures for the Model Portfolio are based on a hypothetical bank roll of $100,000. Dividends and transaction fees are not included in the calculations. A * before the stock symbol indicates a short sale. The anchor put debit/credits are included in the results once the position is closed.
| S&P: | 01/26/18 | 2872.87 | Dollar Profit/Loss = Stock Price Friday – Adjusted Stock Price + (Anchor | |||||||||
| S&P: | 07/13/18 | 2801.31 | Close Credit – Anchor Open Debit) When The Position Is Closed | |||||||||
| S&P Points Gain/Loss: | -71.56 | |||||||||||
| S&P % Gain/Loss: | -2.5% | Adjusted Stock Price = Open Stock Price – Total Spread Profit / Loss | ||||||||||
| Risk Capital: | $100,000 | Spread Losses Occur When The Stock’s Friday Close Is Below | ||||||||||
| Put Hedge Total P/L: | $3,540 | The Short Put Strike Price | ||||||||||
| Hedge Total % Return: | 3.5% | |||||||||||
| # Of Weeks: | 21 | Anchor Put – Debit/Credits Included In P/L Calculations Only When | ||||||||||
| Hedge To S&P P/L Ratio: | 6.0 | :1 | Positions Are Closed | |||||||||
| Win % – Adjusted Prices: | 50.0% | |||||||||||
| Transaction Costs & Dividends Not Included | ||||||||||||
| * After Symbol Denotes Short Stock Position | ||||||||||||
| Open | Open | Anchor | Anchor | Total | Adjust | Close | Stock | Anchor | Dollar | % | Anchor | |
| Date | Stock | Strike | Open | Spread | Stock | Date | Price | Close | Profit | Profit | Exp | |
| Stock | Monday | Price | Price | Debit | P/L | Price | Friday | Friday | Credit | Loss | Loss | Date |
| CELG | 01/29/18 | $105.23 | 105.0 | $5.50 | -$0.59 | $105.82 | 02/16/18 | $95.26 | $10.40 | -$5.66 | -5.4% | 04/20/18 |
| GILD | 01/29/18 | $87.82 | 87.5 | $4.50 | $0.43 | $87.39 | 04/06/18 | $73.41 | $14.27 | -$4.21 | -4.8% | 04/20/18 |
| SLB | 01/29/18 | $77.18 | 77.0 | $1.72 | -$2.19 | $79.37 | 02/16/18 | $66.28 | $10.20 | -$4.61 | -6.0% | 04/20/18 |
| EA | 01/29/18 | $116.12 | 115.0 | $4.60 | -$1.62 | $117.74 | 04/20/18 | $120.89 | $0.00 | -$1.45 | -1.2% | 04/20/18 |
| ADSK | 01/29/18 | $117.84 | 115.0 | $5.80 | -$2.59 | $120.43 | 05/11/18 | $136.21 | $0.00 | $9.98 | 8.5% | 04/20/18 |
| WDC | 01/29/18 | $89.33 | 90.0 | $5.50 | -$3.32 | $92.65 | 05/04/18 | $80.88 | $12.75 | -$4.52 | -5.1% | 05/25/18 |
| PEP | 02/05/18 | $118.24 | 120.0 | $4.35 | -$1.12 | $119.36 | 02/09/18 | $111.18 | $7.35 | -$5.18 | -4.4% | 04/20/18 |
| XOM | 02/05/18 | $82.98 | 82.5 | $2.75 | -$1.21 | $84.19 | 02/16/18 | $76.54 | $6.15 | -$4.25 | -5.1% | 04/20/18 |
| DECK | 02/12/18 | $93.90 | 92.5 | $5.15 | $2.11 | $91.79 | 04/20/18 | $89.00 | $3.50 | -$4.44 | -4.7% | 04/20/18 |
| NOW | 02/19/18 | $154.18 | 155.0 | $7.40 | -$0.55 | $154.73 | 05/18/18 | $173.94 | $0.00 | $11.81 | 7.7% | 04/20/18 |
| WDAY | 02/19/18 | $125.25 | 125.0 | $7.53 | -$1.81 | $127.06 | 05/04/18 | $130.05 | $0.00 | -$4.54 | -3.6% | 04/20/18 |
| JPM | 02/26/18 | $117.90 | 120.0 | $5.10 | -$3.54 | $121.44 | 03/23/18 | $107.01 | $13.60 | -$5.93 | -5.0% | 04/20/18 |
| SWKS | 03/05/18 | $109.14 | 110.0 | $6.70 | -$4.32 | $113.46 | 04/06/18 | $95.56 | $14.70 | -$9.90 | -9.1% | 05/18/18 |
| ATHN | 03/26/18 | $139.00 | 140.0 | $6.70 | $3.03 | $135.97 | 04/20/18 | $146.07 | $5.80 | $9.20 | 6.6% | 06/15/18 |
| AMT | 04/02/18 | $146.40 | 145.0 | $4.18 | -$2.44 | $148.84 | 04/13/18 | $138.90 | $7.30 | -$6.82 | -4.7% | 05/18/18 |
| TLT | 04/09/18 | $120.67 | 120.0 | $2.47 | $0.53 | $120.14 | 05/18/18 | $117.21 | $2.79 | -$2.61 | -2.2% | 05/18/18 |
| PG | 04/16/18 | $78.28 | 77.5 | $2.70 | -$1.17 | $79.45 | 05/04/18 | $72.43 | $5.75 | -$3.97 | -5.1% | 07/20/18 |
| MSFT | 04/23/18 | $95.36 | 95.0 | $4.45 | $0.70 | $94.66 | 07/13/18 | $105.43 | $0.06 | $6.38 | 6.7% | 07/20/18 |
| CVX | 04/23/18 | $122.40 | 120.0 | $4.00 | -$0.45 | $122.85 | 07/13/18 | $124.04 | $0.19 | -$2.62 | -2.1% | 07/20/18 |
| MCD | 04/30/18 | $166.00 | 165.0 | $4.65 | -$3.35 | $169.35 | 06/29/18 | $156.69 | $8.40 | -$8.91 | -5.4% | 07/20/18 |
| XLE | 05/07/18 | $75.33 | 75.0 | $2.43 | $1.04 | $74.29 | $76.26 | $1.97 | 2.6% | 07/20/18 | ||
| ALXN | 05/07/18 | $117.46 | 115.0 | $5.90 | $0.42 | $117.04 | 05/25/18 | $117.74 | $7.35 | $2.15 | 1.8% | 07/20/18 |
| LULU | 05/14/18 | $98.68 | 100.0 | $8.45 | $1.27 | $97.41 | $125.45 | $28.04 | 28.4% | 09/21/18 | ||
| HSY | 05/21/18 | $92.50 | 95.0 | $5.30 | $0.56 | $91.94 | $93.99 | $2.05 | 2.2% | 08/17/18 | ||
| PYPL | 05/21/18 | $81.35 | 82.5 | $4.85 | $1.97 | $79.38 | $87.99 | $8.61 | 10.6% | 08/17/18 | ||
| SWKS | 05/29/18 | $100.02 | 100.0 | $5.30 | $0.47 | $99.55 | $99.60 | $0.05 | 0.0% | 08/17/18 | ||
| UTX | 05/29/18 | $126.48 | 125.0 | $3.50 | $0.66 | $125.82 | $129.51 | $3.69 | 2.9% | 08/17/18 | ||
| PEP | 06/04/18 | $100.31 | 100.0 | $2.50 | $2.54 | $97.77 | $112.69 | $14.92 | 14.9% | 08/17/18 | ||
| V | 06/11/18 | $134.54 | 135.0 | $4.90 | $1.81 | $132.73 | $139.42 | $6.69 | 5.0% | 09/21/18 | ||
| LOW | 07/02/18 | $94.17 | 94.0 | $5.28 | $1.04 | $93.13 | $99.58 | $6.45 | 6.8% | 10/19/18 | ||
| EW | 07/09/18 | $146.47 | 145.0 | $8.60 | $0.94 | $145.53 | $148.13 | $2.60 | 1.8% | 11/16/18 | ||
| DE | 07/16/18 | $135.89 | 135.0 | $5.75 | $0.43 | $135.46 | $135.89 | $0.43 | 0.3% | 09/21/18 | ||