Category Archives: $FUEL

2CentView performance in 2014…

The 2CentView portfolio was up 12% fo the year, which matched the S&P500 but well above the FTSE100 (flat).

The portfolio ended the year 75% US and 25% UK 0% Europe – mainly because the US was the only market showing real jobs growth and a rising stock market – the model also showed many more opportunities in the US than outside the US. The exposure to USD/GBP exchange rate is also something to keep an eye on – sterling strength representing a buying opportunity for US Stocks – but can go the other way!

Where it did badly:
2 Core positions were savaged – Blinkx (down 90%) and $TCG (thomas cook) which cost the portfolio nearly 6% – need to do a better job managing zero cost core positions – where you can take your eye of the ball.

Europe and US House & Autos  continued to underperfrom and took losses in Deutsche Bank, HSBC and $USG and $GM Рall go cut on the 25% Stops (they continued to go lower Рexcept $GM which has come back Рthanks EBOLA!)

Also took some losses in $FUEL, $GIMO, $ICPT on the rotation out of expensive growth stocks into more low growth stocks – growth positions are the riskiest and hardest to manage as moves can be savage.

Where it did well:
$AAL- American Airlines, $SAVE did very well up nearly 100%
$FB up 37%
$CELG and $ISIS – up nearly 80%
$YHOO – up 40% – easiest trade of the year!
$AAPL – up 50%
$MS – Morgan Stanley up 30%
Rite Aid and Radian also performed well (core positions from 2013)

2014 was in general lot tougher than 2013 as the market experienced volatility throughout the year – Russia/Ukraine, EBOLA, Oil price collapse – all tested the nerves – but also represented buying opportunities.
The 2CentView strategy of taking some profits, setting stops helps build low cost positions and mitigates losses from positions not working – this really helps in managing volatile markets – and helps you sleep at night – we all have day jobs!
Overall the portfolio is up 73% since beginning of 2013 when the model and strategy was first built.
Main lesson learnt from 2014 – be more selective and if a core position drops more than 30% – start to exit – even if it is because of a malicous blog!

So 50% of the portfolio was up average of 51% =25.5% on the winners
30% portfolio down 25% = -7.5% on the losers

6% loss on core positions in $BLNX and $TCG

Net=12%

UK Budget – Pension Shakeup “We plan to overhaul the system completely”…..

The government made a huge change to pensions – from 2015 you can do what you want with your private pensions at 55 subject to marginal tax rate. This mean that you are NOT forced to buy a stupid Annuity or have income drawdown restrictions on your personal pension!
Download the udget_2014_greater_choice_in_pensions_explained.pdf from the government web site.

For example if you had 400k in your private pension then take 100k as cash tax free, the rest you can take out subject to normal tax rate in that year – so if you have retired at 55, and take out only 10,500 you pay no TAX!.

Hargreaves Landsdown stock – the provider of SIPPS rallied 15% on the news and the annuity providers were sold off – it is anticipated many more will contribute to SIPPS.
So plan to have 400k at least in your private pension by 55 – then sell the Porsche for a LAMBO! or pay any debts on your buy to let portfolio or buy the villa in south of france…..its entirely up to you..

Construct your portfolio now of the following:

Recovery plays – Good Companies which are broken but are coming back.
Stocks below have made dramatic gains in less than 3 years:
Sports Direct 60 o 800
Thomas Cook 20 to 180
SuperGroup 300 to 1700
DIxons 20p to 50p
HPQ 12 to 30
RiteAid: 1.50 to 6.50

2CentView model identifies when broken companies earnings expectations are expected to rise but the stock price has not reflected this change.

Low Beta Income stocks

BP, DLG, Scottish and Southern – now SBRY.
Buy these companies when there is potential upside of 15%-25% and dividend carry of between 4 and 6%. e.g. $SBRY FV=360, carry = 6%!

Growth Stocks
the Hardest to play – you need to know what you are paying for the growth and whether you think it can meet these expectations (use the PEG as a guide). If you are right gains will be big, but so also is the risk – the stock will be savaged and you will lose a lot if the company fails to meet the expectations.
Important to stick to stops on these.
2CentView model shows that growth stocks fall into 4 categories (over 5 years): low (5-15), moderate (15-35), High (35-50), Super(50-80)

Low: Apple, MSFT, HPQ, IBM, Oracle
Moderate: Google, GOGO, FSLR
High: FaceBook, AMZN, NetFlix, Tesla, GIMO
Super: FUEL, Twitter

$GIMO, $FUEL and $YELP revisited…

Back on Jan 17th mentioned 3 pricey internet stocks:

$GIMO – FV = 39 now $36.5
$YELP – FV= 92 now $85

and $FUEL – which popped on the day to $65 of the tweet so missed the opportunity to buy, but now has pulled back to – now $48.
FV=$80 30% growth if valued 2 years forward.

Take a look at this company – AI On Big Data allowing Companies to improve the way they advertise to target markets….

The NASDAQ continues to go higher as the Cloud and Big Data companies help reduce costs and analyse the mass of data out there. But stocks are expensive – keep positions small to enough to absorb 30% to 50% loss.

$GOOG paid $3bn for a company that makes a smoke alarm and a thermostat??….

..Does seem crazy – even though they are amazing thermostats – but the idea of every day things we use being interconnected and controlled via the internet is gaining momentum and $GOOG have the smartest people out there. Another company $CTRL – control4 Corporation, was good value at $15 – but it doubled in 2 days!

With the NASDAQ climbing ever higher – was the NASDAQ boom in 2001 right but at the wrong time?

Popular (but pricey) stocks that could really monitise this potential growth in the internet of things, big data, mobile, social and cloud are:

$GIMO – GigaMon FV=39, Good Entry point is here at 30, stop $25. Network visilibilty and control traffic. 48% implied Growth.

$FUEL – Rocket Fuel FV= 75 – was up 13% yesterday. 95% implied growth. AI And Big data predictive modelling. May have missed the entry point one.

$YELP – FV=92 5Y Implied 100% – connects people to business. Also look for pull back to $70.

Above are high risk – keep positions small, if they are winners gains will be big.
2CentView has positions in $FUEL and $GIMO.