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MengXi
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University of Waterloo engineering student.
  • Portfolio Update - September 2013 0 comments
    Sep 16, 2013 9:58 PM | about stocks: Q, BBRY, FSLR, LINE, SZYM

    This fall has been very volatile for the stock markets. The Syrian scare has sent the market sharply lower, but then it bounced back nicely when Pres. Obama decided to back off. I don't really want to comment too much on the macro environment because I really don't know what I am doing.

    Turning to my portfolio performance.

    (click to enlarge)The Questrade portfolio has been hit hard, down roughly $200 while NASDAQ and S&P 500 are up $200. The power of index investing, if most portfolio managers can't beat the index, how do you expect me to? Being the young buck that I am, I am still going to try. After all, index investing is boring. The IB portfolio went back above par, however still significantly under performed QQQ.

    Moving on to holdings,

    The under performance in the Questrade portfolio is largely driven by the decline in price of both ARNA and SZYM. Belviq sales have been tepid and lack of the block buster status many assigned to it. However it is still way too early in the game to write off ARNA. With recent direct to consumer marketing, the sales data for the next few weeks should be closely watched. SZYM being the small cap bio fuel company that it is, price volatility is expected, and until substantial revenue starts to flow in, the stock will continue to be pressured. It would be interesting to see sales numbers in the next quarter's earnings call, but before then, its anybody's guess where the stock price is headed.

    The short squeeze on GTAT has certainly been entertaining. The short interest has declined significantly from July levels,

    (click to enlarge)Which explains the stock's explosion from $5 to high $6. With 30% of the float still sold short, another short squeeze is not out of the question, especially if November earnings surprise to the upside. I am hesitant to buy GTAT in my IB portfolio, since I want to see next quarter's EPS and guidance before pulling the trigger.

    For the IB portfolio, I have sold some out of money BBRY Nov 9 puts, as well as FSLR Nov 30 puts during the Syrian scare, as a way to commit some money into the market. I will continue to write cash secured puts on down markets as a way to generate income in this volatile market.

    Of interest to note, LINE which I sold out at $24.50 not long ago, rocketed to $28.30 on news of Berry acquisition going as planned. Talking about bad timing, but such is life. This suggest that SEC has given the go ahead on the merger. The next question comes from whether Berry investors would agree to this merger. Since BRY stock holders gets 1.25 share of LINE, it really doesn't make sense for them since they can sell their shares for a much higher price on the open market.

    In closing, it has been a pretty bad month for my portfolio, largely driven by ARNA and SZYM. Both are very volatile stocks with huge upside and downside potential. Being someone without obligations, having them being a large part of my portfolio will be worth the gamble. Stay tuned for next time.

    Stocks: Q, BBRY, FSLR, LINE, SZYM
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