At the end of last month, I started a $1 million theoretical short portfolio with 7 holdings. Here is the original portfolio for those who haven't read the article:
|Company||Shares||Buy Price||Start Value|
|National Bank of Greece (NBG)||250,000||$0.59||$147,500|
|Suntech Power (STP)||44,500||$3.08||$137,060|
Now here's a look at how things stand currently:
|National Bank of Greece||$0.4899||$25,025||16.97%|
*Apollo sold on Thursday, read below for details.
Overall, the portfolio has gained about 2.75%, which trails the S&P 500's 5.4% loss since then. Unfortunately, Orbitz reported a great quarter and the stock jumped 45% overnight, and has added to its gains since then. If you take out Orbitz, the portfolio is up over 11.3%. This shows how one bad decision can eliminate most or all of your gains. But hey, at least it's still down over time. You'd be making money.
So here's why I still like these positions. Amazon has a forward P/E of 100, and I don't see that lasting for much longer. I've detailed my bearishness on Sprint in several articles, so feel free to read those if you are interested. I think Netflix has had its run, and its time is up. I'm looking for another bad quarter. National Bank of Greece in my mind has no value, so I will hold that until it gets to zero. The solar industry is in trouble now, and the Chinese names are faring much worse, so Suntech remains a viable short. Orbitz has killed me so far, but if you look at the charts, these huge pops usually don't last. I may need to cover that position at a loss, but I think we will go down from here.
I was not going to update this portfolio until the end of the month, but I have decided to swap out an old position for a new one. Last week, Green Mountain Coffee Roasters (GMCR) reported a terrible revenue number and the stock was hammered over growth concerns. It was below $40 but has risen back to almost $52. I will short 2,800 shares of GMCR as I think it will go lower. The GMCR trade was as of Thursday, so that position gained about $3,500 thanks to Friday's 2.4% loss.
To make up for that, I eliminated my position in Apollo. I could have taken gains on either Suntech or National Bank of Greece, which have done extremely well, but I expect those names to go even lower. I've made 6% on Apollo, and since it's the position I follow least of the seven-- I'm going to get out. Everything else will stay the same.
While the overall portfolio's performance has lagged the markets in general, I still would say it's been a few good weeks. A 2.75% gain in just 15 trading days would be great on an annualized basis.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.