Dan AmossDan Amoss

Dan Amoss, CFA, tracks aggressive accounting and other red flags that markets miss. He’s a student of the Austrian School of economics and Daily Reckoning fan since 2000. Agora Financial relies on Dan for macro market commentary as well as profitable plays like his 2008 call to readers to buy Lehman Bros. puts, which gained 462% as the stock fell from $45 to $12. And he called American Airlines’ bankruptcy long before the Chapter 11 filing, telling readers to short the stock, which tanked from $6 to just 26 cents.

Formerly, he was investment adviser to one of the top small-cap mutual funds in the country. He grew up on a semi-working small farm that his great-grandfather bought in 1907, learning thrift and the value of hard work through generations. 

This informs his drive to seek truth and expose frauds and promotions that suck in investors. He cut his teeth in finance interviewing management teams in “roadshows” and so knows the kind of BS they sell.

His bottom-up investing style focuses on management strategy, return on capital and the truth (and lies) buried in financial statements.

Trade Alert: An ETF In No Man’s Land Between Growth and Value

Demand for momentum stocks tends to rise in response to higher prices. Conversely, demand falls in response to lower prices. That's the opposite of real-world laws of supply and demand. It’s the opposite of a value-conscious investor. This month, Jim and Dan focus on one ETF with holdings of momentum stocks that headed into 2021 with no valuation support. Today they are in no man’s land, caught between momentum investors who have been selling, and value-conscious investors. Value-conscious investors might become buyers of these stocks, but not until prices have fallen much further.

C.O.B.R.A. December Portfolio Update

We recommended exiting a few positions this week that had unusually large percentage increases in last Friday’s global risk-off trading session. The media narrative was that sell-off was due to a new COVID variant. This is why COVID policies are one of the macro factors Jim monitors to guide our trades. For now, Dan updates you on the open positions in the portfolio.

Why Turkey Is In a Crack-Up Boom

The Turkish currency is in a downward spiral as investors move lira bank deposits into real assets, including stocks. Also, the Turkish economy will suffer as a result. Productivity will fall as companies stop investing in long-lead-time projects for fear of earning a return in currency that may be worthless a decade or more in the future. Continue to hold puts on the iShares Turkey ETF.

Sell Alert: Take A 58% Profit on JinkoSolar Put Spread

JKS is struggling with high metals and energy costs like every other business. Even though analysts have not yet cut earnings estimates in the past several weeks to reflect mounting Asian supply chain risks, we do believe shares could fall further after Q3 earnings tomorrow morning. Nonetheless, the pricing we have currently is excellent for a two-week put spread trade, so let’s take the profit now.

Sell Alert: Close Out Put Spreads On CMG And BFAM

We have to exit our Chipotle put spread because it’s expiring tomorrow. You need to make this trade by tomorrow afternoon at the latest. We’ve had a nice value recovery this week, so let’s close it out now. Also, BFAM has been declining in almost a straight line since our last portfolio update. With this major rally in our put spreads, we’ve gone from far underwater to a gain of more than 50%. So, let’s sell now for a profit.