Month End Performance & Review

Portfolio Allocation

Trade Anatomy Performance

+3.46% Month End |  +26.3% YTD

Portfolio Summary

9 Open Positions |  52% invested

Watchlist Summary

15 Stocks on List



The month of July kinda felt like a mini version of what the current year has been like.  One minute we're up and everything is great, and then the next minute, we're all doomed.  The reality is that  2015 has been about picking the right stocks and managing the risk accordingly.  These principles are always more evident when the market is not trending steadily higher.  As I look across my trading screens, I do notice a gradual deterioration in the # of stocks making the grade.  In June, the # of stocks passing my screens sat near 330.  As of today, that number sits near 205.  This doesn't mean that we should stop searching for quality trades .  It's simply means that we must focus on both the technical pattern and fundamentals a touch more.  In the current environment long trading bases that have been developing over several years will definitely help.   As I look back on my trading strategy and it's evolution, a key component comes to mind - screening for stocks near their 250 day high.  This was and is still part of the process, but as I studied past winners I realized that a new 350 day high offered a higher probability of success.  When stocks are breaking out of price consolidation, take a look at their weekly charts.  Are they moving out from large consolidations of 2-5 years or have they been trending higher now for several years.  Also, take a look at when a stock makes a new 250 day high.  Is it also making a new 350 day high?  If it is making a new 350 day high, and the stock is moving from a large weekly base then there's a greater chance for success.

Portfolio Summary

During the month,  4 new positions were added and 5 positions were removed.  Adhering to our trailing stops is always as important as finding new trades and in July that was certainly the case.  SCLN, VDSI, SCAI, GSIG, and ORBK were removed from the portfolio.  In total these trades accounted for a loss of -1.44% of our trading capital.  I've highlighted VDSI below.

The VDSI trade was initiated on 6/3/2015 at 27.35 and quickly advanced to around 35 over the next 14 trading days.  As you can see, both the blue and yellow lines trend upward as the stock moves higher.  Generally the yellow line is used to determine initial stop and the blue line is used as the trailing stop.   On July 5th, VDSI closed below the blue line, which generated a stop.  On July 6th, VDSI was removed from the portfolio at 27.85.  When it was all said and done, there was not much profit made from the trade.  But why not just take the trade off at 34?  The reason is that to catch big trends, you have to let them have room to move both up and down.  What I've discovered is that the blue line will give trades enough room to move, and won't shut you down too early on your best trades.  As of Friday's close, VDSI is now at 20.39.

The new trades taken during July were ASC, XON, FLTX, and ANIP.  So far, XON as performed the best out of this group.  Although ASC shot out quickly it has since pulled back near our initial entry point.  XON was initiated on the 7/15/15 at 53.61 and had an initial stop of 47.  The total portfolio position is just over 4% of our trading capital.  XON is currently trading near 65 and up just over 20% since it was added to the portfolio.  The big movers this month were OSIR, SUPN, FLML, XON, and LXFT which added 4.78% to the portfolio's bottom line.  Below are the open positions as of the end of July.


Chart View of Open Positions

Watchlist Summary

We are currently watching about 15 stocks as possible trade candidates.  The list naturally ebbs and flows based on the market environment which is why we are sitting with a smaller amount then usual.  Below are a few of the stocks that we are watching.  

If you would like to receive greater in-depth coverage, then please click the link below. 

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