Time to Make Some Moves as Things Get Ugly for the $10,000 Portfolio
Four buys, one sale and one exit as we fight back and right the ship.
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Gee whiz. Where do I begin?
After more than a week of taking my eye off of the ball, which was necessary to take care of a loved one who had fallen ill, the $10,000 Portfolio has gone from being -7% since inception to -16.2%. Ugly.
I’d apologize to readership for disappearing as these stocks were absolutely roasted, except for two things. One, disappearing at that time was the ethically right thing to do, from my perspective. Two, this is my money. This is not a model portfolio. If the book says it is down 16%, then I am indeed, down 16%.
Fortunately, this is a small portfolio. That said, the series is aimed at newer investors and investors without a lot to invest. So, this may be a large portfolio to the individual reading.
We have some work to do, or I’m going to look pretty stupid. It does not matter to the reader of this series if my larger Sarge-folio is in better shape than is this book or if my bond manager pulls my proverbial tail out of the fire.
It does not ease the pain, but perhaps it helps explain what is going on to understand that rising rates hurt small-caps and tech stocks more so than other stock classes due to the leverage required for these kinds of companies to maintain operations. Since their late summer highs, the Russell 2000 is down 11.1%, and the S&P 600 is down 10.1%. These are our “loose” benchmarks here at the $10,000 Portfolio as we mostly work with low-priced, smaller-cap stocks in an effort to boost the potential reward side of the “risk-reward” proposition.
Handcuffed to an increased potential reward is an increased level of risk. This portfolio is, at present, experiencing the ugly side of that coin flip.
Trading
We are taking some drastic measures Thursday morning to redirect the potential for some improved performance should certain stocks rebound out of technically oversold conditions. We are also trying to maintain a certain level of cash as we traverse this period of uncertainty.
Thursday’s Intentions
– Sell 50 shares of VELO at or close to the last sale of $6.75 to close the position.
– Sell 60 shares of EVLV at or close to the last sale of $4.09 to leave 50 shares.
– Purchase 10 shares of OCUL at or close to the last sale of $7.20.
– Purchase 20 shares of SOFI at or close to the last sale of $13.93.
– Purchase 3 shares of RKLB at or close to the last sale of $52.77.
– Purchase 20 shares of ONDS at or close to the last sale of $5.92.
Portfolio News
Ondas Inc.
Earlier this week, Ondas (ONDS) announced the successful completion of the installation and European Union Aviation Safety Agency, EASA, certification of its advanced Airborne Missile Protection System, AMPS, incorporating Directional Infrared Countermeasures, DIRCM, aboard a Bombardier (BDRBF) Global 7500 aircraft.
Planet Labs
Earlier this week, Planet Labs (PL) announced that its subsidiary Sinergise Solutions had been selected by the European Space Agency, ESA, to build the Slovenia Space Resilience Node, SRN. Running under ESA’s European Resilience from Space Earth Observation program under Element 2, this 12-month pilot project will develop a prototype that automates the link between wide-area satellite change detection and high-resolution imaging tasking for Slovenia’s Administration for Civil Protection and Disaster Relief within the Ministry of Defence.
Rocket Lab
On Wednesday, Rocket Lab (RKLB) shared an update on the Neutron launch vehicle development program, including an adjusted schedule for Neutron’s inaugural launch, which is now expected to occur in 2027. This announced delay, which cited manufacturing defects in a carbon-composite component of the first-stage propellant tank, will add to development costs and could defer efforts to compete more directly with SpaceX (SPCX).
The stock sold off a rough 7.9% Wednesday and is down more than another 11% overnight on this news. Fortunately, we did sell a couple of these shares above the $70 level just before my absence.
Current Positions
Long 60 shares of ASPN at $5.1083. Target Price: $10. Last sale: $5.41.
Long 110 shares of EVLV at $5.6939. Target Price: $8.50. Last sale: $4.09.
Long 140 shares of OCUL at $8.4505. Target Price: $14. Last sale: $7.20.
Short one OCUL $9 Dec 18th call at $0.80, Last sale: $0.55.
Long 260 shares of ONDS at $8.0742. Target Price: $12. Last sale: $5.92.
Long 100 shares of PL at $20.3367. Target Price: $26. Last sale: $13.45.
Short one PL $17 Nov 19th call at $1.70, Last sale: $0.41.
Long 60 shares of PTON at $5.0263. Target Price: $9. Last sale: $4.97.
Long 5 shares of RKLB at $73.8629. Target Price $97. Last sale: $52.77.
Long 130 shares of SOFI at $16.0485. Target Price: $24. Last sale: $13.93.
Long 50 shares of VELO at $10.265. Target Price: $18. Last sale: $6.75.
Cash: $900.31.
Portfolio Value: $8,380.41, -16.2% from inception on March 24th.
At the time of publication, Guilfoyle was long ASPN, EVLV, OCUL, ONDS, PL, PTON, RKLB, SOFI and VELO.
