February 8, 2019

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Highlights from the Week

Insys Therapeutics (INSY) finally saw its bounce this week, jumping 28.57% and reversing its YTD loss into a 26.72% gain for the year.

New Age Beverages (NBEV) suffered the most of those in the cannabis sector after regulators cracked down on CBD being used in edibles (food and drink) without FDA approval. This fear will pass – the FDA needs to approve all ingredients in anything edible and the crackdown is simply a result of restaurants and bakeries putting CBD into their creations without FDA approval. Once the FDA approves CBD for consumption (which they will as consumers want it too much), this too shall pass. The news also pulled down the rest of the cannabis space including Canopy Growth (CGC) and Cronos (CRON).

Tencent Music (TME) continues to jump around like it’s riding a pogo stick. This week, it’s up 5.45% for a gain of 15.02% for the year, but the amount of volatility this position sees in its gains and losses is incredible.  

This Week’s Trades

Aurora Cannabis (ACB): Early in the week, we took some profits on Aurora, one of the portfolio’s biggest positions, when it jumped up to nearly $8.00, selling at $7.63 and $7.93 to take our per-share cost down to $5.20. ACB closed the week at $7.50, leaving us up 44.19% in our position.

Insys Therapeutics’ (INSY) rise to glory was fast and violent with it nearly hitting $5.00 a share. We sold some of our position to reduce our cost basis at $4.29 and $4.73, taking our per-share cost down to $3.34 and leaving us up 31.86% when INSY closed the week at $4.41.

New Age Beverages (NBEV): We took some profits when NBEV initially saw a pop early in the week at $7.56 and then added to our position on the way down at $6.59 and $6.29. Our per-share cost is now $6.46 with NBEV closing the week at $6.30 and our position down -2.41%.

Novavax (NVAX) saw a jump again this week but remains in a trading range. We once again sold a bit at $2.34 to lower our per-share cost to $1.39. NVAX closed the week at $2.27, leaving us up 63.68% on our position.

Rite Aid (RAD) moved as we expected with us adding more when it touched our per-share cost of $0.74 for a hot minute. RAD closed the week at $0.7701, leaving us up 4.07% on our position. Note: We are intentionally keeping our position size unusually small (even for a Trades in Play position) as RAD’s potential bankruptcy gives a higher-than-average chance of a complete loss.

Tencent Music (TME) continues to experience volatility. We sold a little at $15.34 to lower our per-share cost to $10.23. TME closed the week at $14.73 and our position up 44.04%.

TransEnterix (TRXC) lost its footing this week with a pretty spectacular drop. We added to our position at $2.61, $2.48 and $2.34 to take our per-share cost down to $2.68. TRXC bounced to close the week at $2.60 but our position is still down -2.89%.

CLOSED POSITION Yamana Gold (AUY): Yamana was a good performer but we decided to take our 25.35% gain and close our position when it started to lose ground this week. We may re-enter this one in the future, but we’ve removed it from the portfolio at this time. There are other positions with more volatility suitable for trading.