Exits, 12/20/2024
How we did on the trades we exited this week.
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. Starting in July, 2024, I have also been tracking them in this spreadsheet. These are the trades I exited this week.
Stocks or Exchange Traded Products
None
Options
Call spread on Micron Technology (MU 3.82%↑). Entered at a net debit of $0.30 on 12/16/2024; expired worthless on 12/20/2024. Loss: 100%.
Call spread on Micron Technology (MU 3.86%↑). Entered at a net debit of $0.49 on 12/17/2024; expired worthless on 12/20/2024. Loss: 100%.
Puts on Banc of California (BANC 0.46%↑). Bought for $1 on 6/12/2024; expired worthless on 12/20/2024. Loss: 100%.
Call spread on Crocs (CROX 5.48%↑). Entered at a net debit of $1.65 on 8/20/2024; expired worthless on 12/20/2024. Loss: 100%.
Call spread on Neurocrine Biosciences (NBIX 0.67%↑). Entered at a net debit of $1.65 on 8/20/2024; expired worthless on 12/20/2024. Loss: 100%.
Call spread on PDD Holdings (PDD -1.45%↓). Entered at a net debit of $1.60 on 8/1/2024; expired worthless on 12/20/2024. Loss: 100%.
Calls on Robinhood Markets (HOOD 3.79%↑). Bought at $1.70 on 11/12/2024; sold (second half) at $3.60 on 12/20/2024. Profit: 112%.
Calls on Asana (ASAN 12.99%↑). Bought at $0.25 on 12/16/2024; sold (half) at $1.15 on 12/16/2024. Profit: 360%.
Call spread on Tesla (TSLA 0.51%↑). Entered at a net debit of $1 on 11/12/2024; exited at a net credit of $4.78 on 12/17/2024. Profit: 378%.
Comments
Stocks or Exchanged Traded Products
No exits this week, but our core strategy of buying our top ten names, putting trailing stops of 15% to 20% on them, and replacing them with current top names when we get stopped out, continues to perform well, driven by the performance of our top names.
Options
Today is a big options expiration day, and that’s usually when our losing trades pile up (since we often exit winners before expiration). We had trades placed between June and this week expire today. Most of today’s losers were earnings trades, with the exception of our puts on BANC, which was a bearish bet on a regional bank. That one turned out to be ill-timed, as the Fed’s first rate cut of this cycle seems to have taken the pressure off of banks.
Of our three winning trades, two (those on HOOD and TSLA) were Trump “Euphoria” trades we placed last month, and one (on ASAN) was an AI-related post-earnings trade we placed this week.
The Beneish M-Score
The Beneish M-Score is a statistical model used to estimate the odds that a public company is manipulating its earnings. There’s an online calculator at Professor Beneish’s university, but it requires you to enter in a couple of dozen fields from a company’s filings to complete.
Right now, I’m trying to figure out how much the data required would cost, and get an estimate on the software development costs.
If You Are Concerned About Downside Risk
As a reminder, you can download our iPhone hedging app by aiming your iPhone camera at the QR code below (or by tapping here, if you are reading this on your phone).
