This Week's Activity – November 30, 2013:
Weblink to this table: http://www.ultimatestockfinder.com/weekly_index_summary.GIF
This week, the Dow Jones 30 hit a new all time high of 16,174 as did the S&P 500 at 1,813. Other world wide indices were mixed. Here is a good article that summarizes my feelings about the current market conditions: http://www.marketwatch.com/story/dow-16000-wont-last-2013-11-19 I still think the markets are overpriced. But, I am always looking for good values on individual stocks.
This week I sold Cash Secured PUTs on EXC and NLY.
Excelon (EXC) a diversified utility company serving
and . EXC is at $26.91, a 10 year low and pays a 4.5%
dividend (cut from 5.4% in Feb. 2013).
Dividend Payout Ratio is 89%.
This week, I sold a January 2015 PUT on EXC at Strike of $25 for $2.00
(8% premium). Over the prior 2 weeks, I
sold an April 2014 PUT at Strike of $28 and a July 2014 PUT at Strike of $27,
both for $1.80 per share (6.7% premium). If I get any of these EXC options PUT to me, I
will buy and hold the stock and continue to receive that 4.5% dividend, but if
each of these PUTs expires worthless, I will have made the premium return for
having my money tied up until the expiration date and will then get my money
back to use for more PUTs. Philadelphia
See this article that explains current problems being faced by EXC: http://seekingalpha.com/article/1868281-exelon-corp-difficult-time-ahead?source=yahoo
See the Yahoo Profile for EXC at http://finance.yahoo.com/q/pr?s=EXC+Profile
See the Yahoo 10 year chart for EXC at http://finance.yahoo.com/echarts?s=EXC+Interactive#symbol=exc;range=20010131,20131118;compare=;indicator=volume;charttype=candlestick;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;
Annaly Capital Management (NLY) is a Real Estate Investment Trust (REIT) that invests in mortgage obligations, many of which are backed by the US Government (Fannie Mae, Freddie Mac). NLY is at $10.16, a 12 year low and pays a 13% dividend that may be decreased soon. This week, I sold a January 2015 PUT on NLY at Strike of $10 for $1.81 (18% premium).
See the Yahoo Profile for NLY at http://finance.yahoo.com/q/pr?s=NLY+Profile
See the Yahoo 12 year chart for NLY at http://finance.yahoo.com/echarts?s=NLY+Interactive#symbol=nly;range=20010111,20131129;compare=;indicator=volume;charttype=candlestick;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;
StockEvaluator “Short List”
Stocks on the ‘Short List’ have Current Price <5% above 52 week low and have <5 Red cells in Stock Evaluator.xls. Stocks on the list this week are: BFK, RCII, DSU, CSH, BNA
I do not think any of these are a good buy at this time.
Stock Evaluator “Volatility Sort”
Stocks on the ‘Volatility Sort’ have Current Price <5% above 52 week low, Volatility >3%, Profit>0%, <6 Red cells in Stock Evaluator.xls. Stock on the list this week is: SDR
MutualFundEvaluator “Short List” shows funds that are within 3% of their 52 week low AND have less than 3 Red cells. This week’s list has 37 funds. All except 1 are Bond funds, which are all still 3 to 8% above their lows from 2006 to 2008 before The FED dropped interest rates to bring the
out of the recession. When interest
rates go down, bond prices go up, and when interest rates go up, bond prices go
down. These bond funds only pay a 3 to
4% annual dividend and I think they will go down another 3 to 4% when The FED
finally lets interest rates go back to historic levels. I will continue to wait before buying any
bond funds because I will lose a whole year’s worth of interest if I buy back
in too soon. For example, BGNMX closed
this week at $10.72, down from 2011 high of $11.30, but still 8% above 2007 low
of $9.89. My target buy price for BGNMX
is $10.45. U.S.
Here is the 10 year chart for BGNMX that shows these price ranges:
Watching the interest rate on 10 year treasury notes gives another hint of when these bond fund prices will get back to normal. As this interest rate comes back up, the prices of these bond mutual funds will go down. The interest rate on 10 year treasury notes closed this week at 2.74%, up from 2012 low of 1.50%, but way below 2006 - 2007 highs of 5.2%. My minimum target for 10 year interest rates is 3.5% before I will be ready to buy back into bond mutual funds.
Here is a chart showing interest rates over the past 13 years for 10 year treasury notes:
Next Monthly Meeting 2nd Tuesday of every Month:
Tuesday, December 10, 2013 , 7:30 PM at my house.
Here are my Stock BUYs for This Week:
Target Sell Price:
Here are my Stock SELLs for This Week:
Here are my Option (CALL or PUT) Sells for Last Week:
I only Sell Covered CALLs or Cash Secured PUTs
Stock Symbol: EXC
Sell Date: Nov. 25, 2013
Expiration Date: January 17, 2015
Strike Price: $25
Option Price: $1.81
Stock Symbol: NLY
Sell Date: Nov. 25, 2013
Expiration Date: January 17, 2015
Strike Price: $10
Option Price: $2.00
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