Low Volatility (totally sideways action…or inaction) follow by fantabulous volatility explosion. We took advantage of this set up to teach our 17 year old the power of stock options. We told him to watch what happens to the options last week on Friday because we expected a substantial up move in the underlying stock, taking note especially of the March 120 and 125 options. We had positions on, so he was able to experience that first hand also. See the chart below.
See also some of the model portfolio stocks for your 401k. Not many comments made recently because the market did not do much around Christmas, and then there were not storm clouds on the horizon. For example see CREE mentioned late last year in the 40′s, hitting near yearly highs at 70 and outperforming the S&P 500 by wider and wider margins. We will update the portfolio performance soon.
