Sell in May…miss a record HIGH

The old Wall Street adage, “Sell in May and go away,” was a little off this year.  The May downturn presented an excellent buying opportunity.  Thursday the S&P500 posted a new record high.

Will it hold?  I think that depends on what kind of “happy talk” comes out of the upcoming G20 meeting, especially between Trump & Xi.

What’s encouraging is how well the market is performing in spite of Iranian conflicts.  June 13 two Japanese oil tankers where attacked in the Gulf of Oman; June 20 a US drone was shot down over the Strait of Hormuz.

A dovish Federal Reserve and historically low interest rates can paper over a lot of bad news.

In any case, whenever the market hits a record high, it’s prudent to at least consider harvesting some profits.  This is especially applicable to a 401k account where investment choices might be limited to a few Index mutual funds.

This week I didn’t directly sell any positions, however, June Option contracts expired and one of my positions was assigned.  Here’s a rundown of recent Option activity:

  • Expired Unassigned:
    • CALL VERIZON $60 EXP 06/21/19
    • PUT BOEING CO $330 EXP 06/21/19
    • PUT FREEPORT MCMORAN INC$10 EXP 06/21/19
    • PUT SPDR ENERGY $61 EXP 06/21/19
    • PUT FACEBOOK INC $155 EXP 06/21/19
    • PUT FEDEX CORP $160 EXP 06/21/19
  • Expired Assigned:
    • CALL WALT DISNEY CO $120 EXP 06/21/19
      • This fully liquids any open positions I had in Disney and although I’m happy with the overall capital gain, I missed the huge run up that’s taken place over the past two months. This is a classic example of a “bird in hand versus two in the bush” scenario.
    • Sell to Open:
      • PUT CARNIVAL CORP $40 EXP 10/18/19

Watch for an upcoming YouTube video where I’ll review how my Options strategy has played out over the past 6 months.

Also- although US markets are getting frothy, I continue to see opportunity in International and especially Emerging Markets.  My next post will feature a chart that displays Emerging Market potential.

Closing thought- the Wealthsteading Podcast will be celebrating its 5th birthday this July 4th.  What topic(s) would you like discussed as we begin a new year of podcasting? 

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The Robots are Coming: A Human’s Survival Guide to Profiting in the Age of Automation  available at AMAZON and all fine bookstores.

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