By Paul Price of Market Shadows
I may be overreacting but I decided to sell both Honda (HMC) and Toyota (TM) today, locking in small gains on each. The current industry climate (recalls galore and sub-prime financing of 6 – 7 year loans) is looking more like 2007 than is comfortable.
We owned 150 shares of HMC @ $33.68 and sold for $34.82. Our 38 share TM position cost $106.57 and was cashed out @ $114.77.
We used $4,990 of the sales proceeds to purchase 165 shares of ConAgra (CAG) @ $30.24. It was tempting today, down almost 8%. We also picked up 31 shares of Panera Bread (PNRA) @ $148.27 using the remainder of the money we generated.
Panera hit a new 52-week low in earlier trading and is down from a yearly peak of $193.18. ConAgra had been as high as $37.28 during the past year and yields 3.30% at our entry price.
Since we’re now unwilling to hold HMC and TM shares we also closed out our single TM Jan. 2016, $120 put contract and our six contracts of the HMC October 18, 2014, $35 puts. We were able to close the Toyota put for $16.70. We anted up the $1.80 per share asking price to cover our short HMC puts.
The closed out stock and options trades are now reflected as such on our Market Shadows Virtual Portfolios pages. The purchase prices and investment amounts of our latest buys are now found on the open positions list.
Our Virtual Put Writing Portfolio has now posted a net gain of $20,905 since its January, 2013 inception date. The Virtual Value Stock Portfolio hit a new all-time high this week as well. It is now up over 51% since it got rolling on Oct. 26, 2012.
Note: Virtual Put Selling Portfolio is here. Virtual Value (Stocks) Portfolio is here.
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