Tuesday, February 2, 2016

Portfolios With Purpose -- Ka-Ching!

Two items of news on Portfolios with Purpose, the contest I am currently in.

Around 11:00 today, I checked out my PwP positions and saw that Facebook was at the top of the channel, where I previously said I would take profits on HALF the FB call options. I waited an hour to do anything, because that's the minimum time it usually takes to get an issue out the door. The FB January 2017 95 calls had a bid of 29.20 a little after noon. The ask was higher, but you never get filled at the ask price.

Note: I'm just paper-trading the options as a test for a new publication I want to roll out. The underlying stocks are part of the PwP contest I talked about yesterday.

Anyway, I'm following through, and banked gains on half the FB calls. That's a gain of 107% in 12 trading days. The other half of the calls we'll let ride. It's free money now.

And it's a good thing I did. When the Dow dipped way down later in the afternoon, FB turned around and closed lower.

Meanwhile, what about Gilead? Well, it reported earnings at 4:05 pm. Not only did it beat estimates handily, but it also announced a $12 billion share buyback. That sent the stock higher in after-hours trading. We'll see what Wednesday's price action brings.

So, I'm glad I hung on to Gilead. I only did that because it announced approval of one of its new drugs before the market opened on Monday. But sometimes it's better to be lucky than smart.

My PwP positions held up better than the broad market today, but they have been doing that during sell-offs anyway. That's another point in favor of the new trading system I'm working on.

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