HI Financial Services Commentary 04-13-2016
I love it when a plan comes together. – Hannibal Smith – A-Team
Dinner with the Sitze Family over the weekend.
What do “professional” money managers use for a trading instrument?
Guessing, Crystal ball, back testing, ASSET Allocation model based on historical averages
Their portfolio management ended when they put you into the fund.
Don’t worry! You’re in for the long haul.
The PROBLEM: What’s wrong with a historical average?
It’s Just an Average
A $1 stock goes up 50% and down %50 = 0% historical Average
How much is the dollar worth? $1 up 50% = $1.50 then down 50% = $0.75
What’s a 25% historical average return on $1
Well, $1 goes up 75% = $.175 and then loses 50% for a 25% historical average GAIN = 1.75*0.50 = $0.875
What if it lost 50% first= $1 = $0.50 * 1.75 = $0.875
Morgan Stanley on a well-diversified blue chip stock fund made Down 14.9%
If you back out a 3% bond fund loss, and 2% currency loss, and 0.5% S&P 500 loss how much are fees?
3+2+.5= 5.5 then 14.9 – 5.5= 9.4%
BUT why not get something while you wait or as stocks fall down instead of worry with a little heart ache?
Why not pick up shares or lower cost basis or be able to sleep at night
When AA reported you built an earnings list on companies you trade
AAPL 4/25 AMC
BIDU 4/28 est
BABA 5/5 est
DIS 5/10 est
F 4/28 BMO
FB 4/27 AMC
NFLX 4/18 AMC
NVDA 5/5 est
SNDK 4/27 AMC
V 4/21 AMC
VZ 4/21 BMO
HD 5/17 BMO
ZION 4/25 AMC
What’s happening this week and why?
Treasury Budget -108.0B vs est -52.9B
Export .3/ vs est -.4
Imports -.1 vs est -.1
Core PPI -.1 vs est .2
PPI -.1 vs est .3
Retail Sales -.3 vs est .2
Retail ex-trans .2 vs est .4
Business inv -.1 vs est -.1
Where will our market end this week?
Lower – 2 Reasons
Options expiration, The Middle East OPEC meeting
SPX – We have mixed signals, uncertainty, and close to an overbought indicator on the RSI
COMP – Mixed signals here
Where Will the SPX end April 2016?
What is on tap for the rest of the week?=
Tues: CSX, FAST
Wed: JPM, PIR
Thur: BLK, DAL, PNC, WFC
Fri: SCHW, C, FHN, STX,
Tues: Treasury Budget, Import, Export
Wed: MBA, Crude, Fed Beige Book, Core PPI, PPI, Retail Sales, Retail ex-auto, Business Inventories
Thur: Initial, Continuing Claims, Core CPI, CPI
Fri: Empire Manufacturing, Capacity Utilization, Industrial Production, Michigan Sentiment, Baker-Hughes Rig Count
Tues – CN: Merchandise Trade
Wed – EMU: Industrial Production
Thursday – CN: GDP, Industrial Production, Retail Sales, GB: BOE Announcement and Minutes, EMU:HICP
How I am looking to trade?
I’m set for earning sand my big question is do I roll protection to a higher price (strike price)
www.myhurleyinvestment.com = Blogsite
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