Broader market should be consolidating at current levels prior to making any directional move. We will be using the current volatility to deploy more fundamental back-month positions. Diagonal Spread remains our favorite strategy in a directional market.
Aggressive Play - PG signal was executed today realizing 15% gains. Now, only a quarter is invested of our maximum position size (8). Approximately, 83% gains are booked in aggressive play since the launch of auto trading on April 13. We are comfortable holding FXI, HLF and WHR positions. HLF roll is on cards, but such a move will be risky if HLF surprises to significant upside. Let's wait and watch. HLF is holding well at current levels.
Guarded Play - PG signal was executed today realizing 15% gains. Count as 30% gain, as it was a double position. The only open position RGR is at breakeven
New Members - Developers are working on a members' area. Until then, all signals will continue to be issued via emails.
Several of you asked questions about our stock-picking style and basis. Analysis at MWO is based on:
1. Fundamentals (earnings power)
2. Technical's (overbought, oversold, support, resistances)
3. Broader market conditions
4. Actions of other analysts (buy, sell ratings)
Both Aggressive and Guarded deploy similar strategies but stock picking style is different. For Guarded, long leg of the spread is mostly back-month. More, we do not open a signal in the Guarded play unless the entire above criterion is green. Probably that's the reason for having just 1 loser out of 15 trades so far. Guarded Play is sitting at 82% booked gains. Of course, aggressive is higher risk/reward trades and thus a more volatile play. In long run, the Aggressive Play should outperform though past performance is not a guarantee of future performance.
Fortunately, MWO newsletters didn't lose a penny in this wild swing of the market. There will be times when patience will be tested. Hedging is always a good strategy, but it comes with a cost and negatively impacts net gains. MWO deploys hedging at critical thresholds. MWO has mental stop losses, but rarely trades with a stop loss. In most case, we are aware of that the short leg of the diagonal/calendar spread will expire worthless if the stock moves against us. This strategy gives some cushion to our signals.
Responses to the emails of subscribers are generally specific in 1-3 lines. This may not sound very professional. Our professionals come from lean six sigma background and avoid wastage. More, MWO is limited in bandwidth with only 24 paid subscribers as of today (it's only a month since the launch of paid service). We like to spend our energy analyzing stocks for the newsletters.
Many a times, several emails are issued in a day to open/close a position. This is to fill signals at the best available prices. This might have caused missed opportunities. It may be annoying; still, there is no strong reason yet to change this strategy.
Auto trading is active in both Global and eOption. They are GREAT! Entry and exit prices of the signals are based upon the fill price reported by auto-traders. We do good record keeping of those emails. Track record is objective, complete, and straight forward. If you find a discrepancy, let us know for us to fix; it is done inadvertently. Track record is not adjusted for Commissions. MWO is trading its own alerts!!!
MWO tries to keep each option contract signal under $6.50. It may go as high as $10 for large-cap stocks like Apple, Google, etc.
It is important that each of the signals is executed to balance long and short positions. We try to provide concise commentary, but sometimes subscribers may not realize that a signal is only a hedge, so not intended for gain. If you make money, take it off the table or relish account if there are unfortunate losses. Whatever money a subscriber wants to risk, he/she should divide it into 8 equal parts. On an average about 4 positions are open, but be prepared for 8. It might be dangerous if one doesn't trade a hedge due to $$ short in the account. In spite of all, traders can still lose money. We are sure that you must have heard about success and failures of newsletters in the marketplace. See www.investimonials.com for review of newsletters. One's judgment is the best suited to determine his risk profile.
MWO does not entertain comparison with other newsletters. Newsletters differ in strategies, philosophies, and style. There are always good and bad times for all. Trading success is never a guarantee even for the most sophisticated, and knowledgeable professionals. Probably, we are the youngest and least informed among available newsletter publishers. At MWO, We recognize and appreciate efforts of our competitors.
Hope this email answers some of the frequently asked questions.
As usual, we encourage you to review us at investimonials.
MWO
No comments:
Post a Comment