Weekly Recap

To some this image is a major wall of worry. For others, this is a major surfing opportunity. All things considered, I had a good week doing some virtual "surfing".

I am slightly down for the week, but my portfolio doesn't look nearly as bad as the major index performance this week. Monday was a slow day (last day of 2007) and it ended with me buying a new stock - APPY. The position is still up for me at week's end because it is in a defensive sector.

I focused on some stocks that can be protected from a stock market re-pricing in advance of a recession. On Wednesday, I added EGY to my portfolio. Again, I think that energy is fairly insulated from a downturn, especially smaller E&P companies that live or die on finding oil. In their case, the opportunities look good for 2008.

By Thursday morning, I had gotten my hopes up. The selling for the week still looked like profit taking and disciplined and a better than expected jobs report could turn around what was a weak ISM number. The recession re-pricing of stocks could still be avoided.

The tape though was saying something different and I sold my PCP calls and bought some AMZN puts to get really defensive in advance of the jobs report. On Friday, however, all my hopes were dashed. The jobs report was simply horrible. I sold those stocks most vulnerable - AAPL (calls) and PCP at open. Both those stocks took a hit at open, but that loss was only a fraction of what would have been if I had held onto them all day.

I could tell that the big boys were selling every rally and I quickly jumped on board with additional AAPL and AMZN puts. I sold SIRO on a stop shortly into the morning and sold ANSS as well. Both are good stocks, but I wanted cash and believe that I can buy them lower in the next couple weeks.

The puts took the sting out of the morning's loss and I finished Friday at almost break even.

I made a few minor mistakes. For example, I sold AAPL puts to actually go long again when I was head faked into believing that the boyz would try to hold technical support, but I covered and went short again when I realized the mistake. But, all in all, I think the week was well played. Somebody please tell me the right surfing lingo to describe me hanging tough on some gnarly market waves.

Looking to buy puts on any significant rally (except Fed news) next week.