Sunday, November 09, 2008

11/9/08 Bottom Fishing Portfolio Update - Still Down Signficantly After a Month

On Friday, October 3, 2008, I couldn't resist the temptation of buying some stocks before the bailout vote. I bought shares of Bank of America (BAC), J.P. Morgan (JPM), Wells Fargo (WFC) and Monsanto (MON). I believed that these three banks will not only survive this financial crisis, but will be one the four major banking powers in the next year. Monsanto was down over 50% from its high and its seed and agricultural businesses are still very strong.

It appears that the bottom will be tested again. The overall portfolio declined again last week and is down 20.97%, after being down as much as 27.15% the two week's ago. Monsanto is still holding at break even and I've closed the Monsanto put for a small profit.

Bottom Fishing Portfolio
Stock [purchase dateSharesPurchase Price

Price on 11/7/08

Bank of America(BAC) [10/3/08]100



J.P. Morgan (JPM) [10/3/08]100



Wells Fargo (WFC) [10/3/08]100



Monsanto (MON) [10/3/08]50



I also sold one Nov 60 put contract on Monsanto. The contract is an obligation to buy 100 shares of Monsanto at $60. I closed out the contract at $0.91, for a profit of $148.49, or a 62.10% gain.

Put Contracts Sold Short to Open
Stock [short date]SharesShort Price

Price on 11/7/08

Monsanto Nov 60 put (MONWL) [10/3/08]100


closed on 10/29/08 for $0.91

At this point, the market and these stocks appear to be declining again. If Monsanto falls significantly into the low 70s, I will consider selling a put contract on the stock again.

Disclosure: At time of publication, I own Bank of America, J.P. Morgan, Wells Fargo and Monsanto shares.

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This is not financial or investment advice. Please consult a professional advisor.

Copyright © 2008 Achievement Catalyst, LLC

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