Portfolio Trades: 2/24-2/25
Adding selectively, enhancing yield, and staying patient in a volatile market.
Today we had a mild sell-off in the market with some buying interest later in the day, as I begin writing this at 2pm ET. I am putting this note out because I made several trades today and thought it would be useful to provide a quick update and context.
My portfolio oscillated from down about 30 bps early this morning to up about 25 bps now. There was a bifurcation in performance of my holdings, as usual, which suggests to me that my portfolio is well diversified by sector/industry at around 27 holdings.
Briefly I will walk through the trades for yesterday (2/24/2025) and today. You can view the actual transaction screenshots below, just like yesterday. I will publish a portfolio breakdown over the weekend if time permits.
PayPal (PYPL)
I purchased quite a bit of Paypal (PYPL) this morning. I began at the open and purchased in smaller lots through the day between $77.10 and $72.78, averaging $74.66 for the day. I know have a $73.45 cost basis.
Paypal management hosted its Investor Day this morning and, after reviewing the materials and listening to some of the call, I decided to purchase more shares. I will publish a write-up soon detailing more of my thoughts as it currently represents 5.7% of my portfolio up from just over 2% yesterday.
Some brief highlights:
Management launched PayPal One, its consolidated single-branded ecosystem for much of its products and services. The company is incorporating many of its offerings for merchants and clients into PayPal One. I believe it will help drive stickier users on both sides of the transaction as well as increase TPV.
Better than expected guidance on the 2025 and 2027 projections. Management mentioned that OpEx will grow at less than half of Transaction Margin (TM). This will create excellent operating leverage as it increases revenue and TPV. Perhaps the title of my PayPal write-up when it publishes will be:
PayPal is now more than a Growth Story. It’s an Acceleration Story.
Auna (AUNA)
Yesterday and today, I added to my shares of AUNA. It’s the most difficult stock to accumulate in my portfolio at the moment. I picked up shares this week at an average price of $8.12, now holding it as 1.3% of my portfolio at an average basis of $7.55 per share.
Nothing new here. Just read the write-up to understand the thesis.
Marex Group (MRX)
MRX is a holding I have not added to in a while because it appreciated in price so quickly. I did add to the holding today at $34.75 as it dipped lower than I expected and fell into a short-term gap which I find helpful to tactically add at near-term support.
I now hold 2.6% of my portfolio in MRX at a cost basis of $28.04 as I have continued to add on dips.
Amentum (AMTM)
This is a stock that has begun to garner more interest this month than I have ever seen, perhaps rather typical of a spin-off in only its fifth month as a public company. The company remains undervalued and under covered, though several firms are now surfacing during February with their own long reports on the company.
Today I added to shares at $19.57 and now hold a cost basis of $21.28 representing 9.6% of my portfolio.
Short Puts
I opened two new short puts so far this week, taking advantage of the higher implied volatility (IV) and lower strikes.
By the way, you can check out Nam Nguyen Ph.D. for additional research on the theoretical and empirical side of option trading. We also hosted a video discussion on the subject recently.
Wesco (WCC): I sold May 2025 puts at a $155 strike for a 14.6% annualized return before MMF yield. This obligates me to buy WCC shares at a forward PE of 11.4x, which is an excellent price.
I cannot emphasize enough the value of incorporating a cash secured put option strategy into your portfolio once you understand how to do it. It is a huge yield enhancer and also allows me to exercise better patience and discipline in deploying my capital. Essentially - I am less tempted to chase my buys.
PayPal (PYPL): In addition to the outright share purchases above, I also wrote puts for May 2025 at the $65 strike for an annualized premium of 13.4%. If all my existing short puts are assigned to me I will end up owning nearly 8% of PYPL shares in my portfolio at a marginal cost equivalent to a 13.4x forward PE.
Remember this company has excellent growth prospects and huge FCF buying back shares at lower multiples.
Trade Screenshots: 2/24/2025-2/25/2025
That’s all for today, I will publish another write-up soon and continue with periodic tactical trading updates on the portfolio. Again, I will publish a portfolio breakdown over the weekend if time permits.
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Disclosure: This information is provided for informational purposes only and should not be considered a solicitation or recommendation to buy or sell any securities. The author or entity providing this information may hold positions in the securities discussed. This is not investment advice.
I agree with your sentiment on Paypal; although we are down 25K, I remain hopeful!
I used to have some pypl below 70 and sold closer to 90 I guess. Thinking about it again.