Exits, 11/18/2023
How we did on the trades we exited this week, and what we learned from them.
Dids/Pexels
This Week’s Trade Exits
As soon as I exit a trade, I note that in the comments of the post where I first mentioned the trade; at the end of the week, I try to track them all in one post. These are the trades I exited this week:
Stocks or Exchange Traded Products
None
Options Trades
Call spread on Deere (DE 0.00%↑). Entered at a net debit of $4.50 on 8/14; expired worthless on 11/17. Loss: 100%.
Calls on Hertz Global Holdings (HTZ 0.00%↑). Entered at $0.92 on 10/25; expired worthless on 11/17. Loss: 100%.
Call spread on Livent (LTHM 0.00%↑). Entered at a net debit of $0.40 on 9/22; expired worthless on 11/17. Loss: 100%.
Put spread on Tanger Factory Outlet Centers (SKT 0.00%↑). Entered at a net debit of $0.48 on 11/6; expired worthless on 11/17. Loss: 100%.
Put spread on Synovus Financial (SNV 0.00%↑). Entered at a net debit of $0.35 on 6/1; expired worthless on 11/17. Loss: 100%.
Put on Synovus Financial (SNV 0.00%↑). Bought at $1.60 on 6/2; expired worthless on 11/17. Loss: 100%.
Short puts on Orla Mining (ORLA -1.36%↓). Sold the $5 puts on 11/10 for $2.10 (so the break even was $2.90); they were assigned on 11/17 when the stock closed at $2.88. Loss: 0.69%.
Calls on Orla Mining (ORLA -1.36%↓). Entered at $0.73 on 10/5; exited at $0.55 on 11/16. Loss: 25%.
Calls on Epsilon Energy (EPSN 2.97%↑). Entered at $0.85 on 8/11; exited at $0.55 on 11/17. Loss: 35%.
Calls on Epsilon Energy (EPSN 2.97%↑). Entered at $1.40 on 8/9; exited at $0.55 on 11/17. Loss: 61%.
Puts on Denny’s (DENN -0.10%↓). Entered at $1.45 on 10/30; exited at $0.30 on 11/16. Loss: 79%.
Call spread on Polaris (PII 3.21%↑). Entered at a net debit of $1.70 on 10/23; exited at a net credit of $0.80 on 11/15. Loss: 53%.
Calls on The Shyft Group (SHYF 3.44%↑). Entered at $1.75 on 10/24; exited at $1.90 on 11/15. Profit: 9%.
Call spread on WIX.com (WIX 6.38%↑). Entered at a net debit of $2.25 on 11/8; exited at a net credit of $3.36 on 11/14. Profit: 49%.
Call spread on The Cheesecake Factory (CAKE 4.58%↑). Entered at a net debit of $1.20 on 11/1; exited at a net credit of $2.24 on 11/14. Profit: 87%.
Call spread on AutoNation (AN 5.80%↑). Entered at a net debit of $2.25 on 10/26; exited at a net credit of $4.25 on 11/14. Profit: 89%.
Comments
Stocks or Exchange Traded Products
Another week with no exits, as our core strategy of buying our top ten names and holding them until they get stopped out (and then replacing them with a new top ten name) continues to perform well. As we noted in our top names post on Thursday, 15 out of 19 of our top names cohorts outperformed the market over the next six months.
Options Trades
November 17th was a big options expiration date, and we had trades from June 1st until now expiring then, including a number of trades that expired worthless. Let’s go through a few of these see what we can take away from them.
Deere (DE 0.00%↑). This was a spread we entered in August, with the idea that we’d use an expiration date covering two earnings reports. That approach seems to make sense more for higher conviction trades than for earnings trades.
Livent (LTHM 0.00%↑), Orla Mining (ORLA -1.36%↓), and The Shyft Group (SHYF 3.44%↑). All three of these were oversold stocks (as measured by RSI) that had high Piotroski F-Scores. All are facing some macro headwinds though: LTHM is in the lithium business, and there appears to be a bit of a supply glut with that now; ORLA is a gold miner, and gold’s been languishing amid high interest rates; and SHYF has lowered guidance due to the economy. Selling puts on names like these may be the way to go in the future. I’m happy owning shares of ORLA at current prices, and would have been happy getting assigned puts on the other two similarly.
Synovus Financial (SNV 0.00%↑) was one of the regional banks we bet against due to its level of unrealized losses and indications that it had exhausted the new federal bank assistance facility, the BTFP. We keep getting more signs of stress in the banking system, but so far, no more regional banks going bust. It could be we were too early with some of these trades, or the thesis was simply wrong, and the government isn’t letting any more of them go bust. To be determined.
Epsilon Energy (EPSN 2.97%↑). Another company with excellent financial health facing some macro headwinds (low natural gas prices). Selling puts may have been the way to go with this one too.
We’ll be updating our earnings trade factors spreadsheet this weekend, to see which of our factors are currently the strongest bullish and bearish indicators, and applying it to next week’s earnings trades.
