IB Net Payout Yields Model

Trade: Buy Apple, Sell DUG

On the huge selloff this am I made the following trades. Bought Apple (APPL) for the Growth and Hedged Growth Portfolios in the low 90s. Sold 2/3s of the DUG (Ultrashort Oil and Gas ETF) in the upper 70s.

  • APPL has a $20B cash position and no debt. Currently trade at 10x cash flow with substantially higher growth even considering the slowdown. With the cash position, APPL should be able to gain market share in this downturn.
  • The growth portfolio has made a 150%+ gain on the DUG investment. With todays huge selloff, it just seemed the right time to cash in. Market wants to turn and we don't want to lose the gains.

Edit: Added NYX to Hedged Growth b/c it has a strong balance sheet and no credit risk. Sold the remaining DUG shares at 80. Added WFC & CAT to the Net Payout Yield portion of the Hedged Growth fund. Both are strong companies really beated up and that portfolio was still in signifiacnt levels of cash.


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