Investors & Friends:
There is no new investment activity to report since our last weekly update.
Lead Fund Manager
Investrio
Sunday, August 28, 2011
Sunday, August 21, 2011
Investors & Friends:
Here's a summary of our investment actions from the past week.
Option Strategies - Covered Calls
1) General Electric Company (NYSE: GE) - Our Jan '13 calls reached 80+% of their maximum value, so we closed them out. The date we opened the trade was 3/16/11.
Option Strategies - Naked Puts
2) Blackstone Group LP (NYSE: BX) - We sold Jan '13 $5.00 puts. We currently hold BX long. If the puts are ultimately assigned, it will double our BX position.
Lead Fund Manager
Investrio
Sunday, August 14, 2011
Investors & Friends:
Here's a summary of our investment actions from the past week. The theme for the week turned out to be global stalwarts, specifically wide moat companies deriving 50-75% of their sales from outside the U.S.
Option Strategies - Naked Puts
1) Proctor & Gamble Co (NYSE: PG) - We sold Jan '13 $32.50 puts.
2) Coca Cola Co (NYSE: KO) - We sold Jan '13 $35.00 puts.
3) Johnson & Johnson (NYSE: JNJ) - We sold Jan '13 $35.00 puts.
Long Stocks
4) We bought ProShares UltraShort 20+ Year Treasury (NYSE: TBT) on 8/10 @ $24.89, doubling down on our position, reducing our cost to $38.38. The last time the yield on the benchmark 10 year Treasury note was getting down to the 2% range and falling below the dividend yield on the S&P 500 was during the ’08 financial crisis and ’09 stock market bottom.
Click here for the Investrio Stock Selector Fund Bull and Bear Market Indicators Report for the week ending August 12, 2011.
Click here for upcoming IPOs.
Lead Fund Manager
Investrio
Etcetera
Currently the 10 largest M&A deals are averaging about an 11% spread between the announced acquisition price and the current market price. The most interesting one, to us, is the deal between Medco Health Solutions Inc. (MHS) and Express Scripts Inc. (ESRX), a 23% arbitrage opportunity. Here's the deal specs.
- Premium offered: $12.62 or 23.64%
- Acquirer: ESRX
- Target: MHS
- Offer per share: 0.81 share and $28.80 cash per share
- Value of offer per share: $65.99
- Value of outstanding common equity securities: $29,812,971,780
- Acquirer share price: $45.91
- Target share price: $53.37
- Expected closing: 1H 2012 3/31/2012
- Annualized gain: 36.95%
- Note: After the transaction closes, MHS shareholders will own about 41% of ESRX.
Here's a summary of our investment actions from the past week. The theme for the week turned out to be global stalwarts, specifically wide moat companies deriving 50-75% of their sales from outside the U.S.
Option Strategies - Naked Puts
1) Proctor & Gamble Co (NYSE: PG) - We sold Jan '13 $32.50 puts.
2) Coca Cola Co (NYSE: KO) - We sold Jan '13 $35.00 puts.
3) Johnson & Johnson (NYSE: JNJ) - We sold Jan '13 $35.00 puts.
Long Stocks
4) We bought ProShares UltraShort 20+ Year Treasury (NYSE: TBT) on 8/10 @ $24.89, doubling down on our position, reducing our cost to $38.38. The last time the yield on the benchmark 10 year Treasury note was getting down to the 2% range and falling below the dividend yield on the S&P 500 was during the ’08 financial crisis and ’09 stock market bottom.
Click here for the Investrio Stock Selector Fund Bull and Bear Market Indicators Report for the week ending August 12, 2011.
Click here for upcoming IPOs.
Lead Fund Manager
Investrio
Etcetera
Currently the 10 largest M&A deals are averaging about an 11% spread between the announced acquisition price and the current market price. The most interesting one, to us, is the deal between Medco Health Solutions Inc. (MHS) and Express Scripts Inc. (ESRX), a 23% arbitrage opportunity. Here's the deal specs.
- Premium offered: $12.62 or 23.64%
- Acquirer: ESRX
- Target: MHS
- Offer per share: 0.81 share and $28.80 cash per share
- Value of offer per share: $65.99
- Value of outstanding common equity securities: $29,812,971,780
- Acquirer share price: $45.91
- Target share price: $53.37
- Expected closing: 1H 2012 3/31/2012
- Annualized gain: 36.95%
- Note: After the transaction closes, MHS shareholders will own about 41% of ESRX.
Sunday, August 7, 2011
Investors & Friends:
Here's a summary of our investment actions from the past week.
Option Strategies - Naked Puts
1) Joy Global Inc (Nasdaq: JOYG) - We sold Jan '13 $40.00 puts.
2) General Motors Co (NYSE: GM) - We sold Jan '13 $15.00 puts. It's our view that GM is better positioned than other automakers in the key areas of labor cost, sales outside U.S., and management. Also, the close proximity to the recent IPO is still influencing options pricing, with the options premiums staying elevated relative to the options of other stocks.
3) Pfizer Inc (NYSE: PFE) - We sold Jan '13 $12.50 puts.
4) AT&T Inc (NYSE: T) - We sold Jan '13 $17.50 puts. We also considered Verizon. We kept Verizon on our watchlist pending resolution of the wireless workers' strike.
5) Exxon Mobil Corp (NYSE: XOM) - We sold Jan '13 $35.00 puts.
Click here for the Investrio Stock Selector Fund Bull and Bear Market Indicators Report for the week ending August 5, 2011.
Click here for upcoming IPOs.
Lead Fund Manager
Investrio
Here's a summary of our investment actions from the past week.
Option Strategies - Naked Puts
1) Joy Global Inc (Nasdaq: JOYG) - We sold Jan '13 $40.00 puts.
2) General Motors Co (NYSE: GM) - We sold Jan '13 $15.00 puts. It's our view that GM is better positioned than other automakers in the key areas of labor cost, sales outside U.S., and management. Also, the close proximity to the recent IPO is still influencing options pricing, with the options premiums staying elevated relative to the options of other stocks.
3) Pfizer Inc (NYSE: PFE) - We sold Jan '13 $12.50 puts.
4) AT&T Inc (NYSE: T) - We sold Jan '13 $17.50 puts. We also considered Verizon. We kept Verizon on our watchlist pending resolution of the wireless workers' strike.
5) Exxon Mobil Corp (NYSE: XOM) - We sold Jan '13 $35.00 puts.
Click here for the Investrio Stock Selector Fund Bull and Bear Market Indicators Report for the week ending August 5, 2011.
Click here for upcoming IPOs.
Lead Fund Manager
Investrio
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