Samwise Model Portfolios
The portfolios below are separated by launch dates. Each portfolio is entirely independent and has no bearing on any other model portfolio. We launch entirely new portfolios during each market correction as an illustrative tool for new subscribers who weren't present during...
Please login to view this page.
What trades are you watching for Frey & Stark Portfolios to Launch?
So the QQQ will dominate the position as with the other portfolios because the QQQ instantly diversifies us. We’re less subject to company risk.
We also have high visibility into the QQQ as well as high leverage via options. But in terms of the other 45%, it really depends on what becomes the most discounted on the correction.
Any bellwether can end up in our portfolio. Nvidia will get added for sure. Apple is now too over-extended from a valuation perspective. So we’d need to see a major sell-off in Apple to get long apple.
We’ll probably allocate capital toward Nviida, Palantir, MicroStrategies and then 1-2 quantum computing names. It depends on what happens during the correction itself and what opportunities arise.
This is rather inconsequential, but which will be the options portfolio and which will be the common stock?
Also, do you expect the allocations to be similar in each, just stock vs options? Or are the assets likely to be substantially different?
Similar assets. The common stock portfolio is just more conservative.
Stark = options
Frey = common stock
Hello Sam,
What do you think about quantum stocks like :
Rigetti Computing
Quantum Corporation
Quantum computing
D-Wave
Is it too late to buy ?
Best
Karl
It really depends on what you’re trying to do. I don’t know a ton about quantum computing stocks beyond the obvious.
For me, I’d look to trade it from a momentum perspective and then wait to invest once a company emerges as an established leader like Nvidia has with Ai.
What we do here is leverage assets that we have high forecasting visibility in. For example, the positions we bought in the QQQ back in September and August are up nearly 100% at the moment.
So we try to produce our returns in the things we understand well. If there’s an asset I don’t understand as well, then I usually relegate that to trades off oversold conditions or as a momentum trade during braod-based market rallies. Or if a company’s valuation falls to within reasonable levels during some major correction, then we’ll go long in our main portfolios under those circumstances. It’s opportunistic for us.
At the moment, we’re not really buying anything because (1) the NASDAQ-100 is soon due to pull-back 3-4% and (2) the entire market is getting close to a correction.
Once those two things are behind us, then’ll buy a wide range of different stocks in Baratheon and make trades where appropriate in Targaryen.
Let me take a look at each of these charts and get back to you.
So what do you think ?
Haven’t had the chance yet. I’ll post a comment here for you during tomorrow’s trading session.
Thanks
Going to look at it right now. Non-stop work atm. going to do post on it in today’s briefing.
Hey Sam,
Those Leaps in the early options Portfolios are gonna expire in 2 years. Do you plan on „extending“ them to keep the 2 year time horizon.
I am sure you touched on this, I just cannot recall it at the moment.
Concerning the hedges for the new portfolios: would the price for those hedges not be cheaper at higher pricelevels after the correction when the indices make new highs?
Thank you:)
Concerning the hedges. Yes. They would be. If we waited to put on the hedges later, it would be better, obviously, but what we gained by putting the hedges on ahead of time is that it prevents us from going into some sort of a crash.
If you always buy on corrections, eventually, you’re gonna buy one time into a bear market.
For example, in 2022 early on it look like a big correction of 18% and it turned into something way way worse. So the idea is to have the hedge in place so that if we buy into a bear market, we are protected.
Now we’ll later on be able to reposition hedges. We will be able to sell a hedge that we have and buy a new one. And if we’re ever at that point, it’s a well worth it because it means that we’re up massively. So that’s the thinking here regarding the hedge ahead of time.
——
So yeah, we will be rolling the options forward down the line. We did cover it and the plan is going to be to sell deep in the money covered calls, giving us our capital back. And then we will use the new capital to buy a new set of calls.
So we’re not going to sell the positions per se, we are going to sell deep in the money covered call such that we will essentially get our money back without raising a tax issue.
Out of curiosity, how did you trade/navigate the 2022 bear market before it became clear that it was a bear market?
Did you have to accept and cut losses on your long trades during those circumstances?
Do you think the fact that this year is an election year will have an impact on the timing of the correction (if it happens at all)? For instance, would the presidential inauguration in January delay the correction by another month or so?
No. Not really. Every market environment has its very particular set of circumstances that could either delay or shorten the rally period.
But one thing we’ve consistently seen for at least the last 15 years is that these rallies go no longer than 100 days. And when we get to 100 days that’s usually at the very far end of the range.
Melt up rallies are a lot different and do extend a bit further. But not by much and they usually don’t go far in terms of percentage gains.
And if we combine August and September, this rally is 95 days old.
So we’re very close to getting an iPhone/Android app out. Once that happens, I think Dark mode can be enabled there.
QQQ haven’t moved post market. Does this have any significance?