Tuesday, September 30, 2014

Trading positions review

I wanted to go over all my positions today.  I decided to sell out of APA today, with the continued deterioration in oil prices.  I am now only holding WLL and EOG, of which WLL is by far the larger position.  On the one hand I hate to be selling during such a strong pull back, but on the other hand it just feels to me like there could be quite some ways to go on the down side.



Chesapeake Energy (closed out):

I really should never have touched Chesapeake.  This is a company that is still recovering from the overly adventurous management of CEO Aubrey McClendon.  I still intend to do a post on CHK at some point, since it is a fascinating company.  Overall the trade wasn’t as disastrous as it might have been, since they did spin out seventy seven energy, which is worth about $1.58 per share at current trading prices.  Including the spin-out I netted 5.5% on CHK.  Had I held it I would now be badly underwater, with shares currently trading at $22.99 as of today’s close.  So on the one hand, I never should have bought this, but on the other, at least I ended up in the black by a bit.

Apache (closed out):

Overall this was a decent trade, with a 22% return not including dividends.  I bought it fairly well, and time will tell whether it was sold well.  I would certainly look at buying it back if we get a pullback or I regain some confidence in oil prices.

EOG (open):


I should have held off for longer, but this is a stock that I have wanted to own for a long time.  I may reassess after earnings.  The current position is relatively small.  I consider EOG to be the best managed oil large-cap E&P.  The chart does look ugly though.


 Whiting (open):
Whiting is by far the bigger position of the two remaining, at about 3x the EOG position.  I should have taken some off the table, as it has now pulled back off the highs by about 15%.  I intend to hold this through earnings on October 22 and then reassess.   Overall I'm still pretty deep in the black with a 38% net gain compared to the average acquisition price.


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