After the mini-meltdown in early February, stock prices boomeranged and made back a good chunk of their losses. In some cases the bounce was pretty big and it forced me to make a few decisions. There were a few days where the market tanked pretty big and I used them as opportunities to open some new positions. Like the previous month, I've decided to break down my decisions into 3 parts. In this post (podcast) I will review my decisions to buy more shares and sell some shares. The other two posts will focus on my decisions to buy shares in Southwest Airlines (blog, podcast, mind map video) and Big Lots (blog, podcast, mind map video).
Sold Spider Aerospace and Defense ETF (Ticker: XAR) for 22.8% gain (net forex adjustments)
On an apples to apples up 27.36%. Sold to bank profit. Playing on Mad King theme of throwing money into defense as Guns and Butter as paid off. One cloud is the rising protectionist bent which first salvo fired in the tarrifs on steel and aluminum. If implemented this will raise the costs for defense contractors and aerospace who rely a lot on aluminum and steel. Possible that companies like Boeing and Lockheed Martin could pull back in the Medium term. I don’t feel comfortable staying in the ETF to find out the hard way, so I sold it. I still have it on my watch list and will keep an eye on it and consider jumping back in on a lower valuation if the tarrifs do indeed bite.
Added to position in Imperial Oil (Ticker: IMO)
Stock continues to drop despite a backdrop where oil prices have risen up to the $60-70 range. The question is why the stock prices haven’t fallen suit. I started buying Imperial when oil prices were in the $30’s. From what I can tell there is a big time issue with getting oil from Canada to the refineries in the US. There appears to be not enough rail cars to transfer. They have the tracks but no cars! Because they can’t get the oil to the market it is sitting and being monetized. I have to believe that this logistical issue will get straightened out. The US$ remains depressed and so oil prices should stay pretty firm. I used the pullback to buy more shares to lower my cost base down to $40.63. I’m currently down 17% on this position, so I am getting close to my loss threshold level of 20 percent where I would cut and run if it crossed there. It’s a tough one.
Sold position in Nordstrom (Ticker: JWN) for 26.4% gain (net forex adjustments)
Sold to bank the profits. Rumours company may try again to go private have given it some legs so decided to sell on the way up and bank the profit. UPDATE: The family submitted an offer to take the company private at $50 and it was rejected by the Board of Directors. Stock fell a bit. Given the latest failure it wouldn’t surprise me if the family backs off for a while, so if it plays like it last time, the stock could drift lower which would then make it an interesting opportunity to buy back in. UPDATE 2: After negotiations between the family and the company, they decided to back off so it looks like there is very little likelihood of the company going private anytime soon. Sure enough the stock has been drifting lower and is down in the mid $40’s. If it manages to get into the $30’s, I may consider coming back in. It looks like my decision to sell at $52 was a good one.
Added to position in Walmart (Ticker: WMT)
Stock falling below $90 and then down to $85 and so these opportunities to buy more shares to average down my cost to $89.
Added to position in CVS Health (Ticker: CVS)
Stock has been falling pretty hard in the last month and since the February melt-down, so much so that I bought in a couple of times. Once at $67 and again at $62. My cost base is now $73 which is down from my initial purchase at $80.