Trade Alert: Taking some profits on Sony, adding a small tranche hedge

Markets trading flattish this morning. Maybe it’s time for a flat market for a few days or weeks? The action has been so volatile for the last year…maybe it’s time for some churn. At any rate, I’m writing up a lot of analysis about the current short-term and long-term set up for the economy and the markets and I’ll have that out to you tomorrow.

In the meantime, I’m doing a little trading this morning, locking in some profits. I’m selling about 1/3 of my remaining Sony $SNE call options that I’d bought in late January when the stock was around $21 a share. With the stock right now trading at about $26.50, these call options have more than tripled in value. Just doing some disciplined profit taking here today by selling 1/3 of my remaining Sony calls then.

I’m also going to add another small tranche of some SPY puts here, nibbling on some puts that will expire in June with strike prices around $195, paying about $3.35 or so for them.

A couple other notes for you until tomorrow’s big report on “What’s Next for Energy, Stocks and the Economy”:

Those who bought $AAPL on the news it was about to become a $DJIA blew it. It’s usually best to sell stocks when they get added to an index and to buy them when they get kicked out of an index. “Apple’s first year as a Dow component has been ugly” https://t.co/gjtJTT2bDK

I actually wrote an article on Marketwatch when $AAPL got included into the$DJIA a year ago called, “Why its Dow entry could be the top for Apple,” published on March 6, 2015. “I’m not sure I’d try to market time based on DJIA inclusions and removals. That said, for the next few months, I wouldn’t be surprised to see Apple lag the markets and struggle for a while. If only to wash out some of the weak-handed, newfound longs in the name. I’m long Apple for 13 years this month and plan to hold steady for now, but note that I also trimmed some near $130 recently.”

I’m not terribly surprised by any of the $VRX cockroaching headlines as I laid all this out in my original report when I shorted the stock five months agohttp://tradingwithcody.com/201…. But I am still shocked that hedge fund giant Bill Ackman basically bet his career on this company when it was 8-10x today’s price. Here’s a good write up on the latest $VRC cockroaches from this morning here:http://www.headlne.com/hdl/711…