October Market Forecast and Strategy

First, I wanted to let those who follow the blog that I will be on the west coast and europe for the next three weeks and posts will be sporadic or non existent.

As those following know,  we went to 100% cash at the end of July, leaving only small remaining option positions in the portfolio. This month we have added to our oil stock positions adding XOM, CVX, APC with a total 4% allocation. We also have added long term calls 2017 on Alibaba ($baba) (see post below). We think the market has gone way too far in this sell off but quite frankly  are quite nervous about market sentiment. We want to increase our exposure significantly.  Our strategy, limit our downside by buying a portfolio of long term options 2017,2018 on what we want to own: FB,GOOG,BABA,MSFT,AMZN, V, GE, as well as both consumer discretionary and industrial elf’s (outright). We are paying the price of premium to have leveraged upside and known downside as this market still seems quite unstable. Hopefully buying low and buying time with options will give us the chance to sell high over the remaining qtr of 2015 or beyond. Our outlook for October is clearing skies.Unknown-2

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