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COVID90: final purchases

Today I purchased the remaining 19 stocks to round out the COVID90 portfolio.

I’ve received questions as to the timing of my decision to jump back into the market.  As previously stated, I’ve been waiting for a COVID 2nd Wave panic to present a buying opportunity.  While that still may occur, at this point, I think the election timetable will have more of an impact on the market than a resurgence of COVID.  Not that it necessarily matters whether it’s Tweetle Dumb or Tweetle Dee, but just the CERTAINTY of knowing which Pinocchio will be occupying the Oval Office.  As such, with the election just around the corner, time is running out.

BUT…the COVID90 portfolio is based on much more than just timing the election.  Please note the below chart, which represents the average price action of the cumulative COVID90 stocks year-to-date.  The portfolio generally mimicked the market during the COVID collapse in March and then recovering through the early June peak. 

But that’s where the correlation ends.  The market recovered in August and went on to set a new record high in early September.  COVID90 has been staggering since the failed breakout in June.  Perhaps because of a resurgence in COVID infections as the economy began to re-open.  This is a primary reason that I’ve been anticipating a COVID 2nd Wave downturn. 

HOWEVER, note that the September 24th trough never dropped as low as the May 13th bottom.  Also, the yield on the 10 Year Treasury generally followed this trajectory, putting in an absolute COVID panic bottom on August 3rd.  Since that bottom, the yield has risen nearly 42% and is above both its 50 & 100 day moving average.

The price action of the COVID90 stocks is the primary factor that has influence my decision to buy in at this time. 

Today’s purchases included:

BAX        Baxter

CSCO     Cisco

EIX          Edison

ETR         Entergy

FEYE       FireEye

INTC      Intel

ITRI        Itron

LDOS     Leidos

LHX        L3Harris Tech

LYFT       Lyft, Inc.

MEI        Methode Electronics

NGVT    Ingevity

NTAP     NetApp

SAFM    Sanderson Farms

SLQT      SelectQuote

TAP        Molson Coors

UA          Under Armour

WAB      Wabtec

XOM      Exxon

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