Weekly Reads, Reviews and Comments – July 30, 2017


I am fairly comfortable with my current holdings.  I have >15% cash in taxable, and plenty of dry powder in nontaxble accounts as well.  I will continue to look for opportunitistic profit taking in the Radar Position 2 companies, and writing covered calls for some others.  Over the next few weeks, i think the 10yr Treasury is the key indicator and it will be watched carefully … i read somewhere this weekend that 2.4% on 10yr is a critical point.  that is about the point where i am willing to take positions in the 7-10yr durations – investment grade muni and corp (not sure about treasuries).

For new positions or building existing ones, the favorites remain (pending logical entry points):  STAG, QTS, MSFT, SWKS, CSCO and APPL.  Of all these, MSFT is probably my favorite.  Shorts being considered though too early on all 3 right now:  THO, NFLX and NVDA.

Data Analysis is Important

Here is an interesting article from SA this morning … now the content itself is a bit hazy and incomplete, but there is a very good data insight that cannot be emphasized enough … maybe it could be called the importance of ‘mathmatical context’.  In our increasing use of headlines, tweets, and other ‘snackable’ information, context and understanding are secondary.  For investors, that surface understanding can cost us …

“Just as logically, there should be some “proportionality” to yield curve tightening. While today’s yield curve would require only an 85 basis increase in 3-month Treasuries to “flatten” the yield curve shown in Chart 1, an 85 basis point increase in today’s interest rate world would represent a near doubling of the cost of short term finance. The same increase prior to the 1991, 2000 and 2007-2009 recessions would have produced only a 10-20% rise in short rates. The relative “proportionality” in today’s near zero interest rate environment therefore, argues for much less of an increase in short rates and ergo – a much steeper and therefore “less flat” curve to signal the beginning of a possible economic reversal.”



Discards – FPI; Reductions – NWL, TJX

Closed FPI position (last remnents of a speculative REIT purchase) – first time was on earnings and discussion, and this last time was on inconsistencies from the CEO on up-coming lease renegotiations.  This is just a bad picture forming and i do not have the stomach or patience to wait and watch dishonest / obscurely speaking CEO.  I swallowed a 9.5% loss in non-taxed account for this mistake.  Key learning from this mistake … do better research on the CEO, the company promises (and how they’re kept), as well as stronger competitor analysis.

NWL position was reduced by 30% in taxable account.  My cost is <$12/share, but i am just running out of confidence in consumer, as well as taking an opportunity to reduce my investments in oil-based plastics.  This was simple housecleaning, no message to risk / reward for the company other than the macro consumer fatigue that i see looming on the intermediate horizon.

TJX position was reduced as well by 30% in taxable account.  The position sold cost was >$77, and i just did not see the patience path to profit and i had gains to offset … take the loss and focus on the lower priced positions that actually have profit potential in near/intermediate term.  TJX is completely out-of-favor, and i have paid the price for underestimating the negative sentiment.  Key learning from this mistake, exaggerate the risk discount in price targets … i was 10% off.

Weekly Reads, Reviews and Comments – July 23, 2017

FPI Inflection Point

I still have a very small position in FPI … waiting for the dead-cat bounce to make next decision, and the time is nigh.  Two recent articles in SA help a bit, but for me i am not patient enough to wait this one out.  I will take my money and go play somewhere else.

Probably the icing on the cake for my decision is the distrust of CEO now established with his inconsistent narrative on lease renewals, as well as the renewals scheduled over next 24 months.  Risk for surprises is just too high.

jnj – q2 earnings


  • love point they are trimming portfolio and reinvesting proceeds for future rather than giving it all ack to shreholders
  • analyst focus is pharma
  • there were good points made about jnj credo and a bit of tranparency on drug pricing

more finacials this weekend

Weekly Reads and Comments – July 16, 2017

Personal Portfolio Commentary

  • sold all of my WTR >$33.00 (sell target within Radar Position
  • added an incremental slice to T (intend to add more if price continues to drop >of 5.75% yield
    • cannot speculate on probability either way)
    • T becomes one of largest taxable holding
  • targets this coming week
    • CTWS liquidation
    • NWN liquidation
    • Select REIT out-of-money (OTM) call sales

Radar Position 2 Action: Increase T

I took a ‘buy along the way’ dollar cost averaging approach to increasing my portfolio position of Radar 1 stock T.  Add on price was $36.20, and overall position in taxable account (the only account w/ T holding separately – not in ETF or Fund) to 5.87% making it one of my top holdings w/ only BMO the same size.  The new addition lowers my cost basis to $36.89; an unfortunate negative position.  I am prepared to take an equal size (or larger) addition but only after Q2 earnings and the TWX event is resolved.