Balanced Investing Strategies

November 11, 2013

Market Strategies Newsletter

Sample Issue

Covering High Return Balanced Investing Strategies To

Make Money In Up Or Down Markets

A Publication of Princeton Research, Inc. (www.PrincetonResearch.com)

 

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Balanced Investing Strategies Newsletter

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Market Strategies Stock Options Trading

$10,000 Account

There are four open positions:

 

BAC Dec 14 Calls

CSCO Nov 23 Calls

NBG Jan 2015 7 Calls and

DOW Dec 39 Calls

 

Funds in Use $ 1,980

Market Strategies Stock Options Trading

$10,000 Account

Traders Comments

This week we had a Gain of $482

bringing YTD performance up to a profit of $29,915

 

Returns of Over 299%

 

$10,000 portfolio is now worth $39,915

 

This was about as bipolar week in the markets as I’ve seen in a long while.  We managed a small gain of $482 bringing our YTD performance back up to $29,915.

Since I was traveling (driving from Boston-N.Y. and back) this weekend I didn’t get to watch the Sunday morning talk shows, but during today’s drive I managed to hear roughly 3 1/2 hours of  NPR…..It was time well spent, as I got a little more information from a wider cross-section than the D.C.-centric T.V. shows.  It amazed me to hear how many more “non-partisan” interviewees are fed up with Washington.  If you follow my comments you already know how disgusted I have been with the current state of the “process.”  It gave me some (not much but some) hope that the public, through its disapproval, feels the same way.

Back to the market….TWTR aside, it was a very exciting week. The outside day on Thursday really made it look like the sky was falling…and it might be, but the rally Friday just shows how much cash on the sidelines want to come in.  I believe that we may be higher at year-end, but it clearly is not going to be a straight line move up.  Lots of charts have been damaged and the internals of the market are tenuous, but keeping a balanced view and only buying support and not getting too greedy on either side remains the plan for the coming weeks.

…CAM

Market Strategies Stock Options Trading Chart

$10,000 Account

One New Trade:

BUY  8   XRT DECEMBER 86 CALLS @ $ .95 OB

 

Remember, these trades are based on your participation in the

Subscriber Members Only

TEXTING SERVICE TO RECEIVE ALL UPDATES.

 

Previous closed out trades not listed here may be seen in previous market letters in the VIP Subscribers Members Area.

 

Options Trading Strategies Notes: In Texting we have a limited amount of words. In the interest of brevity: we use 8=August , 9=September . The Quantity and Strike Price for each trade is specific.

 

The Quantity and Strike Price for each trade is specific.

 

We may trade weekly options and they are noted: SPY 1/25 147 for SPY Jan 25^th 147 calls or puts.

 

Market Laboratory – Weekly Changes

Prices are copied from Barron’s Weekly and Yahoo Finance and may be incorrect

M1…all money in hands of the public, Time Deposits Traveler’s Checks, Demand Deposits
M2.. adds Savings and Money Market Accounts both compared with the previous year.

 

New Stock Recommendations

Market Strategies $100,000 Trading Portfolio           

Each stock is allocated a theoretical $ 5,000 share of the portfolio unless otherwise indicated.

 

Note: Previous closed out stock and option positions can be found in past Market Strategies Newsletter issues available in the Subscribers Members Area.

For those of you who do not buy puts to protect your portfolio, there are many ETF’s that are the inverse of the DOW. The symbols are DOG, DXD, SDS,TZA and RWM, which go up when the  DOW, S&P 500 and Russell 2000 go down and down when they go up. The DZZ goes up double when gold goes down.

 

Market Strategies $100,000 Trading Portfolio

Recommendations And Overall Comments

New Trades:

BUY 16  XRT DECEMBER 86 CALLS @ $ .95 OB

We lost $ 1,196 in closed out positions last week

reducing our profits for the year

to a hypothetical $ 58,024

 

Returns of Over 58%

 

not counting open positions losses of about $ 10,294

 

We also have not counted dividends received on stocks like Apple and JP Morgan.

 

We have four long options positions:

The Stock table has the following 21 positions:

The options call for a $ 2,500 investment unless otherwise stated; each stock position requires $5,000 unless specifically stated.

 

We are basing money management on a hypothetical $ 100,000

and are using $ 3,960 in four options positions and

$ 64,126 in 21 stock positions

totaling $ 68,086

with $ 31,914.00 in cash.

 

These figures are approximate. We do not count commission costs and there may be errors.

Executions that have occurred at or near the open or close of trading sometimes vary from our actual numbers.  For example, when something opens down and it is through our price, we take the next trade whether it is an uptick or continues lower.  This sometimes results in a 50% trade that is slightly above or below the exact number.

 

Previous Week’s Recommendations and

Rules for the Market Strategies

$100,000 Portfolio Trading Account

• All options count for about $ 2,500.00 for model portfolio calculations unless otherwise stated

• When the option has doubled sell half the position

• Stop Loss protection is either half or offered with each trade

• The cost of the option is the asking price (or the price between the bid and ask, whichever is more realistic)

• The options will be followed until closed out.

• Option Symbols are stock symbol with expiration month and strike price

Note: Previous closed out stock and option positions can be found in past Market Strategies Newsletter issues available in the VIP Subscribers Members Area.

 

NOTE: This is a Sample Issue Only!

TO GET OUR TRADE ALERTS BY TEXT MESSAGE AND

THE COMPLETE VIP MEMBERS ONLY

MARKET STRATEGIES NEWSLETTER ISSUES

Visit:

PrincetonResearch.com/investment-strategies.htm

 

To Lock In Your SPECIAL Low Subscription Rate

This Weeks’ Market Strategies

Economic Numbers and Media Data

Market Strategies Trading Fundamentals

U.S. stocks rose on Friday after a stronger-than- expected October jobs report, leading to a record close for the Dow industrials and a fifth straight weekly gain for both the Dow and the S&P 500.

The Dow Jones Industrial Average climbed 167.80 points, or 1.1%, to end at 15761.78, topping Wednesday’s record close.

Gap Inc. (GPS) shares rose sharply Friday after reporting better-than-expected October same-store sales. The parent company of Banana Republic and Old Navy gave a third-quarter profit of 70 to 71 cents a share that topped the 66-cent estimate. The company said while margins were under pressure, it controlled expenses to boost profit.

J.C. Penney Co. which stopped reporting monthly metrics long ago calmed its investor base in reporting that same-store sales edged up 0.9% last month, its first monthly increase since December 2011.

Costco Wholesale Corp reported a 5% increase in sales excluding gasoline, topping expectations for 4.5% growth. Among the stronger performing categories were garden, toys, office, small appliances, jewelry and apparel, though the company noted the consumer electronics category was muted.

Earlier in the week teen retailer Abercrombie & Fitch Co. earlier reported a 14% plunge in fiscal third-quarter same-store sales and set expectations for a low double-digit drop for the fourth quarter.

Home builders fell on Friday as the yield on the 10-year Treasury note spiked after the release of the surprisingly strong jobs report for October. Shares of Lennar fell more than 4%, while shares of PulteGroup fell almost 4%, and shares of D.R. Horton fell more than 2%.

 

Market Strategies Economic Data

The U.S. GDP grew at an annual rate of 2.8% during the third quarter. The good news is that was better than the 2% trade forecast. The bad news is that the extra growth was due to a buildup in inventories. The U.S. economy added 204,000 jobs in October well above the average forecast and despite the shutdown that was expected to put a pressure hiring. Additionally hiring for September and August were both revised up by a combined 60,000. The unemployment rate ticked up to 7.3% from 7.2% likely from data related to the shutdown.  Increased hiring occurred during October at retailers, bars and restaurants, lower-paying establishments that tend to boost hiring temporarily for the holiday season. However, almost every industry except the government added workers.  The upwardly revised gains in August and September suggest the economy might contain more strength than it appears. The price on 30-year U.S. government debt fell more than two full points, pushing yields up to 3.855 percent from 3.728 percent on Thursday.  Average hourly wages edged up 2 cents to $24.10 while the average workweek was unchanged at 34.4 hours. Spending by U.S. consumers in September rose 0.2% in September, down from an unrevised 0.3% gain in August. Personal incomes rose a seasonally adjusted 0.5%. Since incomes rose faster than spending, the personal savings rate climbed to 4.9% from 4.7%, marking the highest level since last December.  Inflation as gauged by the PCE price index increased 0.1%, with the core rate excluding food and energy rising by the same amount. Over the past 12 months the PCE index has risen 0.9% overall or by 1.2% on a core basis. Gains in consumer incomes is barely outpacing inflation however recently declining gas prices can act likely a tax break for some consumers.

  

Market Strategies Technical Information

Support Levels S&P 500    1756 and 1738

Resistance S&P 500           1780 and 1794

 

Support Levels DOW          15,690 and 15,520

Resistance DOW                 15,842 and 15,925

 

Support Levels QQQ           8186                  

Resistance QQQ                  8379

                  

Support Levels Nasdaq      3884

Resistance Nasdaq             4017

 

Market Strategies Cycles

Stock markets remain in overbought territory. Interest rates are likely to be an impeding factor as they will tend to rise at this point in the economic cycle. However second day down patterns should be good buy opportunities.  November begins the “Best Six Months” for the DJIA and S&P 500, and the “Best Eight Months” for NASDAQ. Small caps come into favor during November, but don’t really take off until the last two weeks of the year. November is the number-three DJIA and S&P 500 month since 1950. Since 1971, November ranks third for NASDAQ. November is also third best for Russell 1000 and Russell 2000 fourth best since 1979.
November maintains its status among the top performing months as fourth-quarter cash inflows from institutions drive November to lead the best consecutive three-month span November-January. The month has taken hits during bear markets and November 2000, down –22.9% (undecided election and a nascent bear), was NASDAQ’s second worst month on record—only October 1987 was worse.

 

In post-election years, November’s market prowess is relatively unchanged. DJIA has advanced in 12 of the last 15 post-election years since 1953 with an average gain of 1.7%. S&P 500 has been up in 11 of the past 15 post-election years. Small cap perform well with Russell 2000 climbing in 6 of the past 8 post-election years, averaging 2.6%. The only real blemishes in the November post-election year record are 1969 (DJIA –5.1%) and 1973

(DJIA –14.0%, OPEC oil embargo).

Being a bullish month November has six bullish days, though it does have weak points. NASDAQ and Russell 2000 exhibit the greatest strength at the beginning and end of November. Russell 2000 is notably bearish on the 12th trading day of the month, when the small-cap benchmark has risen just four times in the last 29 years (since 1984). The Russell 2000’s average decline is 0.52% on the day. Recent weakness around Thanksgiving has shifted DJIA and S&P 500 strength to mirror that of NASDAQ and Russell 2000 with the majority of bullish days at the beginning and end of the month.

A good way to trade Thanksgiving is to go long into weakness the week before the holiday and exit into strength just before or after.

 

Disclaimer – Rule 17 B Attestations

Princeton has approximately 2,581,578 shares of AIVN both free and restricted and represents them for I.R.. Princeton also has about 40,000 shares of TXGE. Princeton is paid $ 1,500 per month from RMS Medical Products. Princeton has bought 81,100 shares of RMS Medical Products. Princeton will be engaged by Target Energy. No contract is currently in place. When there is no movement in penny stocks, even though there is none or very small losses, we will liquidate if money is needed for better opportunities. We now believe the two small penny stocks ( REPR and AIVN ) we represent for a total outlay of $ 4,725 is well worth the risk. The Target ADR trades at about $ 5.90 in U.S. vs 0.065 in Australia. Princeton owns 400,000 Australia shares and about 500 U.S. ADR’s.

Pursuant to the provisions of Rule 206 (4) of the Investment Advisers Act of 1940, readers should recognize that not all recommendations made in the future will be profitable or will equal the performance of any recommendations referred to in this e-mail issue. Princeton may buy or sell its free-trading shares in companies it represents at any time.

 

CONTACT

Please Direct All Inquiries To:

Mike King (702) 650-3000

mike@princetonresearch.com

Or

Charles Moskowitz (781) 826-8882

 

Princeton Research

3887 Pacific Street, Las Vegas, Nevada 89121

Phone: (702) 650-3000

Fax: (702) 697-8944

Balanced Investing Strategies