Virgin Galactic (SPCE)

Virgin Galactic (SPCE) continues to be a spiraling mess of a Raging Dumpster Fire in Space, crashing another -17.49% this week after a selloff in speculative tech combined with SPCE’s founder selling most of his position, the cancellation of a test flight, and… wait for it… financial irregularities. That’s a resume for The Week’s Biggest Loser if I’ve ever heard one!

What is the Recovery Speculation Basket?

The Recovery Speculation Basket (“Recovery Spec”) represents stocks that will thrive if vaccines are released quickly and we return to normal but have the likelihood of collapsing if more lockdowns occur. These positions are too speculative to have their own allocation and share a single allocation.

Currently, my Recovery Spec stocks are as follows: the Airlines Exchange Traded Fund (JETS) and Carnival Cruise Lines (CCL). They are listed as a single allocation in the portfolio breakdown chart each week. 

Options (SPY Put Spreads): *New Position*

Following the market’s fairly epic selloff on Wednesday and subsequent bounce on Thursday, I decided to pick up some protective insurance against the S&P 500 in the form of put spreads on SPY.

I bought the SPY 6/4 408-405 put spreads, buying SPY puts with a $408 strike price expiring on June 4 and selling puts with a $405 strike price. Each spread cost $99.30 ($0.993 per share of 100 shares) after trading fees and has a maximum total potential of $300 ($3.00 per share, the difference between the puts I bought and the puts I sold), a 3:1 difference thanks to the decrease in VIX (the Volatility Index) on Thursday.

In other words, if S&P 500 closes at or below its low from this week (~$404), I will triple my investment in spreads. Of course, if SPY closes above $408 on June 4, these put spreads will expire worthless.

Current Status
Cost: $0.993
Value: $0.505
Profit/Loss: -49.14% 

DraftKings (DKNG): Added to Position

Despite its excellent earnings report last week and more and more states legalizing sports betting in order to make up for revenue shortfalls,
DraftKings (DKNG) continued to come under selling pressure this week.

DKNG dropped through a buy order of mine which filled at $44.50 on Monday, lowering my per-share cost -6.364% from $55.00 to $51.50. From here, my next buy target is $35.10 and I’m considering profit-taking should DKNG retake its all-time high of $74.38.

DKNG closed the week at $44.89, up +0.88% from where I added Monday.

Grow Generation (GRWG): Added to Position

Grow Generation (GRWG) got smacked along with all of the new high-flyers on Tuesday, dropping through my price target which filled at $37.24. The buy order raised my per-share cost +22.94% from $22.06 to $27.12 but also gave me a bigger allocation in this picks-and-shovels cannabis play.

From here, my buy target is $26.25, slightly below my current per-share cost and slightly above a previous point of support. My next sell target is around $82, a target calculated using Fibonacci Retracement techniques.

GRWG closed the week at $39.93, up +7.22% from where I added Tuesday.

Palantir Tech (PLTR): Added to Position

Palantir Technologies (PLTR) broke down before earnings this week, falling through a trailing stop buy order I had in place on Monday which filled at $18.25. The order reduced my per-share cost -4.80% from $25.65 to $24.42. From here, my next buy target is $14.50 and my target to start taking profits is near PLTR’s all-time high of $45.

PLTR closed the week at $20.08, up +10.03% from where I added Monday.

Tradeweb Markets (TW): Profit-Taking

While much of the tech sector was collapsing, Tradeweb Markets (TW) entered deep overbought territory and scored a new all-time high on Monday. As much as I really like the prospects of this company for the long term, I absolutely had to take profits, locking in a sale at $83.44.

The sale locked in +147.60% in gains on shares I bought in the middle of the pandemic selloff at $33.70 on March 18, 2020. Calling a bottom is more luck than skill, but it’s fun to note that Tradeweb’s all-time low during the selloff was $33.23, just $0.53 lower than that buy.

From here, I have no additional sell orders and plan to add back to the position if TW sells off to $67.20, slightly above a significant point of support.

TW closed the week at $83.88, up +0.53% from where I took profits Monday.

Virgin Galactic (SPCE): Added to Position

From financial discrepancies to delayed test launches, Virgin Galactic (SPCE) has returned to its days of being a Raging Dumpster Fire in Space, literally. On Tuesday, SPCE completely collapsed and dropped through a buy target of mine with an buy order filling at $14.30.

Tuesday’s buy locks in +64.57% in gains on shares I sold on January 26 for $40.36. From here, my next buy target is $9.60, slightly above SPCE’s pandemic low from March 2020, and my sell target is near its all-time high of $62.80.

SPCE closed the week at $16.18, up +13.15% from where I added Tuesday.