We locked in our first profit since our two losing trades back at the beginning of February, near the near-term highs for the S&P 500.


Our SPY March 17, 2023, 440/445 bear call spread that we sold for $0.63 on February 2 was only worth $0.15 after the pullback in SPY mid-week. As a result, we decided to lock in the $0.48, or 10.6%, and take all risk off the table. With over three weeks left in the trade it didn’t make sense to continue to hold on to the trade for the potential to make an additional $0.15.

As earnings season comes to a close, we still have several opportunities ahead of us.


The holiday-shortened week starts with the potential success or failure of our Home Depot (HD) trade placed late in Friday’s trading session. Due to the market closure on Monday and HD’s earnings announcement prior to the opening bell Tuesday, we needed to place a trade on Friday.

February expiration has passed and we were able to lock in 14.97% on a cumulative basis for the cycle. Three out of our four positions made a profit with GDX essentially closing out the expiration cycle at breakeven, as we only lost $0.05 on the trade.

Our cumulative total return since starting the service just over eight months ago is 64.67%.

What started out looking like another positive week for the market later turned into a week of little gains or losses, as economic data and Fed speak weighed on stocks on Thursday and Friday. For the week the S&P 500 and Dow fell marginally, while the Nasdaq rose just over 0.5%.

What started out looking like another positive week for the market later turned into a week of little gains or losses, as economic data and Fed speak weighed on stocks on Thursday and Friday. For the week the S&P 500 and Dow fell marginally, while the Nasdaq rose just over 0.5%.

In the February issue of Cabot Early Opportunities, we continue to pursue stocks offering exposure to a diversity of end markets.

Our top pick this month is a mega-cap tech company making waves with AI investments that promise to shake up one of the largest software markets in the world.

We also take a look at a small industrial company, cover two software stocks with leadership positions in their respective markets and peak at a recovering semiconductor stock.

As always, there should be something for everyone in this month’s issue!

For the first time in the new year, the market had a bad week. The declines aren’t terribly surprising or worrisome (for now), as the recent rally had been without much of a pause.

After living through 2022, we’re certainly not going to whistle past any market graveyards, so our antennae are up when it comes to the market’s recent wobble—but instead of guessing what may come, it’s best to just go with the evidence in front of you, and so far, everything looks normal. That doesn’t necessarily mean we’d be piling in here, but we continue to lean bullish. We’ll leave our Market Monitor at a level 7 today.

This week’s list is very mixed, but with the chip sector looking peppy, our Top Pick is comes from that space and also quacks like a new growth leader. The stock is extended here, but dips of a couple of points would be enticing.

An improving stock market brings our Stock of the Week portfolio to capacity, 20 stocks, with today’s addition of a fallen growth stock whose name you will almost certainly recognize. It’s a company whose business was hampered more than most during Covid, but has now returned to pre-pandemic levels – and is on track to resume its prior growth trajectory in the years ahead. And the stock is finally playing catch-up. It’s a new addition from Cabot Growth Investor Chief Analyst Mike Cintolo.

We currently have three open positions due to expire in March, all of which are leaning towards the bearish side of things. As a result, we need to add some positive deltas to the mix, which I intend to do this week. Other than that there really isn’t much to discuss at the moment since we are relatively early in the March expiration cycle.

Expiration is upon us and our positions are shaping up nicely for some decent returns. There really isn’t much to do this week with our existing positions other than just allow them to play out through expiration. That being said, I continue to scour our Income Trader watch list for new trading opportunities to add to either the Income Wheel Portfolio or the Income Trader Portfolio. Now that earnings season is nearing an end my hope is to add several positions to the mix.

It’s a slow week for the earnings calendar as we begin to wind down earnings season. There are only a few noteworthy opportunities with our focus squarely on Cisco Systems (CSCO), Devon Energy (DVN) and Coca-Cola (KO). Admittedly, while the three companies fulfill our liquidity screen, the options premiums offered in each are less than ideal, which could ultimately be a deterrent from taking a trade this week. No worries, because some of our favorite trading opportunities come the following week in the form of Walmart (WMT) and Home Depot (HD).

The bull market is back. But there seems to be a disconnect between recent stock performance and the headlines. What’s going on?

The idea that gold prices can rise while the dollar is strengthening appears, at first glance, to be a contradiction. After all, how can gold (which is priced in dollars) advance when the dollar is moving higher at the same time?

This week’s Friday Update includes our comments on earnings from eight companies. Also, Toshiba (TOSYY) reported earnings this morning, along with its plan to split into three companies.

First a quick personal note. Our backup plan for the kids today (out of school because of the holiday) fell through so I’ll be spending much of the day with two young, energetic boys who could care less about the stock market! I’ll be keeping tabs on things but may not get to email responses today unless a response is super timely.

Looking at the bigger picture, nothing has changed with our overall thoughts: The evidence tells us it’s a bull market and that the intermediate-term uptrend remains intact.

Like nature, stock markets have seasons. We experienced a brief but frigid winter about 18 months ago when nearly every stock wilted as capital markets froze (no pun intended, mostly). Then, just as surely as spring follows winter, an exceptionally generous dose of warm sunshine, water and fertilizer in the forms of extremely aggressive monetary and fiscal liquidity and stimulus returned the stock market to brilliant health where nearly every stock blossomed with vibrant growth.

Times are good. After a rough September, the market soared 8% higher to a new all-time high. Earnings have been spectacular, and the bull market is back, although the market has pulled back in the last couple days.

The long-awaited infrastructure bill is putting more wind in our sails and, after eight months of working through a bear market turned range-bound slog, we’re enjoying a bull market in Greentech once more.

This week’s Friday Update includes our comments on earnings from eight companies.

The market was steady this past week as the Federal Reserve completed its two-day meeting and announced plans to end its stimulus program but keep rates unchanged. Some highlights among Explorer stocks:

It was a glorious October. The S&P 500 was up about 7% for the month, more than making up for September’s 4.8% decline. Now what?

Halloween is one of my favorite holidays of the year. There is minimal preparation, no gifts to get, no travel – you just get to celebrate with friends & family and watch your kids have the time of their lives.

While copper futures prices remain firm, copper ETFs have come under renewed selling pressure late this week, thanks in part to persistent strength in the U.S. dollar and in spite of widespread hopes of additional monetary easing measures in China.

The top five holdings of this fund are ASML Holding NV (ASML, 6.82% of assets), Tencent Holdings Ltd (00700, 5.38%), MercadoLibre Inc (MELI.SA, 4.09%), Tesla Inc (TSLA, 3.49%), and Alibaba Group Holding Ltd Ordinary Shares (09988, 3.32%).

I will keep this update short and sweet.

Investors are being challenged with some of the strangest stretches in market history. On the surface, the market looks to be in great position. Stock indexes are hitting or are near record highs, but there is a lot of commotion below the surface. As it stands, roughly 40% of all stocks within the S&P 500 are below their 200-day moving average, which typically indicates bear market action. However, technology has been incredibly strong, especially the mega-cap stocks like AAPL, MSFT, AMZN, etc. And 40% of the S&P 500 is comprised of technology stocks, hence the current 17.6% return in 2021.

As the Cabot Micro-cap Insider recommendation list has swelled in size, I’m realizing that I have too much capital allocated to previously disclosed ideas.

This venerable retailer is going big in the ecommerce and automation arenas. The company has just partnered with robotics company Symbiotic to automate 25 regional distribution centers with upgrades including the addition of “high-speed mobile bots” and “high-speed palletizing robotics.”

The major indexes were fine today, with the Dow up 45 points and the Nasdaq down 33 points. But that masked a horror show under the surface—the average stock we follow was off more than 2%, similar to growth-oriented indexes like the Russell 2000 Growth Index (IWO, down 2%) or the Ark Innovation Fund (ARKK, off 3.3%).

The one thing that has held back gold from gaining any meaningful traction in recent weeks has been the utter lack of a fear catalyst. But that has now changed as gold has a new “fear factor,” as discussed in this week’s report.

In the past 30 days, 14 analysts have increased their EPS estimates for this energy company.

This eyecare company is forecasted to grow its earnings by 19.2% next year.

The top five holdings of this ETF are Saia Inc (SAIA, 3.06% of assets), Chart Industries Inc (GTLS, 2.89%), Exponent Inc (EXPO, 2.58%), UFP Industries Inc (UFPI, 2.55%) and John Bean Technologies Corp (JBT, 2.51%).

The most dominant theme in the metals sector right now is the leadership of lithium in an otherwise dull (short-term) market environment.

A few Cabot Options Trader subscribers have asked me about ways to protect gains in their portfolios, so I thought I would write to everyone with a couple of strategies using options to hedge your portfolio.

A subscriber recently asked me if I keep a journal of my trades. Many traders keep journals so they can look back at their trades and evaluate what they did right and what they did wrong.

Want to know how the big institutional investors use options? Here is an example of how one trader spent $132 million on three technology stocks.

Options trading has its own vernacular. To know how to do it, you need to know what every options term means. Here are some of the basics.

Our Cabot Top Ten Trader’s market timing system consists of two parts—one based on the action of three select, growth-oriented market indexes, and the other based on the action of the fast-moving stocks Cabot Top Ten features.