Mjlong
Rising ETF's - 401K optionWith the drop from profit taking in medical cannabis / HEMP CBD ETF's just looking to compare MJ, TOKE and THCX as some of top ETF's in this sector.
Did you know you can trade ETF's in 401K fund? Ask your investment holder about this option, as ETF/ETP's are like Mutual Funds, but offer typically lower fee's and entry/exit like a stock.
* With recent pullback all nearing golden ratio retracement 0.618.
* All 3 have shown similar RSI
* THCX was most up on close 2.12 over MJ, TOKE
* Legalization expanding, medical benefits of CBD as well and now we're past initial market cycle of segment IPO's and into longer term profit cycle and secondary market investing.
* Profitability for most still on-going issue for as they weather early start-up issues (mite/disease/energy/waste/cash flow vs multi-state/country operations growth)
* Await Genomic (CRSPR Cas9) improvements in next 1-2 years with improved resistance to spider mite attack with optimized benefits without crop loss risks of past half-decade by all the large growers.
* Nicotine reduced crops (Twenty Second Century Growth IP) NYSE:XXII XXII
Cannabis Stocks, have bottomed, $CGC $TLRY $MJ$CGC is the gold standard, top performer of all time,
Target 1, $30
Target 2, $40
Target 3, $70
$TLRY was the hardest pumpin IPO made over 1000%
Target 1, $8.9
Target 2, $13.79
Target 3, $28
$MJ is more of an Index/ETF
Target 1, $15
Target 2, $22
Trading Edge 2020 Portoflio -Trade #1 - MJ - Under loved Pot ETFTrading Edge 2020 Portfolio trade #1
Ticker: MJ
Position:
- Looking at long dated call options (Jan 15th 2021)
- $15 strike (ITM, gives some degree of protection against theta decay)
- Cost (approximately $460/ contract, at current mid bid and ask, willing to go as high as $5.00)
- 0.72 Delta (ITM)
- Running 2x contracts (allows us to sell one on the way up, also makes a more meaningful position size)
Profit Target/ Exit:
- looking for mean reversion to allow us to sell half to have a riskless trade, this would require a move to around the $22.50 - $23.00 range
- Given the fact the position is a long-dated option, we will not run a technical stop, instead we will let the position run and check to see if it performers or not (i.e. no point running a 50% stop and getting stopped out, 1 month into a 12 month contract).
Rationale:
- Speculative counter trend play on MJ, given the overwhelming negative sentiment
- Simple position to manage, the long-dated nature means that we have 12 months for this ETF to regain it's legs, also means that if we get a market correction, we have the time to ride it out
- Despite the price action, MJ has been a high beta performer, if we are going through a 'melt up' phase, then MJ is likely to be swept up in the euphoria
- Both MACD and RSI signaling a possible bullish reversal (or even just a potential bear rally)
- Moving averages signaling a possible bounce is due, not necessarily a total trend reversal
- TradingEdge
Portfolio spreadsheet available to view here >>> docs.google.com
