My trade in the SPY puts worked out better than I expected and a bit faster too.
The market started down and continued to get worse all day until around 2:00 when the volume went negative about 12:1 and stocks were 8:1. They then came back in a bit to close $80 off the low in the Dow and $8 off the low in the S&P500. These are not great rallies, but the lows do correspond to the bottom Bollinger Bands on both. The real support on the S&P are the 2119/2120 areas from the bottoms early September.
We are also long some Boston Beer (SAM) with an average of $154. This is a company with only about 9,000,000 “A” shares in the float and a new additional buyback fund of $160,000,000. At the current level of $158, that means they could buy a bit over 1 million more shares at this level, or about 11%. SAM has bought back over 4 million shares already and the obvious take on this is that they are taking it private. This was a company that went public initially by putting coupons in their six-packs and other size packages that allowed their faithful consumers to buy into the deal.
The other group that looks interesting to me would be financials. If we are indeed going into a rising interest rate environment then the yield curve will help steepen and banking will have better margins and actually generate some profits. The easiest way to play this is probably the XLF. If you want an individual name I’d say Bank of America (BAC) on any pullback is probably the one to go with….CAM
Contact Information or to Subscribe to The Moskowitz Report:
Cell: (617) 827-1296