Thursday, October 17, 2013

Adding to positions in IBM and VMI

IBM is off over 6%, and VMI is down again today.  I'm adding to both of these positions today.


I placed limit orders for both the stocks mentioned above after writing the headline this morning, and both were filled. I bought IBM at $174.40 and VMI at $132.30.  Both are below my initial position prices, and bring down my average cost.  I like IBM for the long run, and I like VMI for the short to intermediate term.  Both are trading at nice discounts to "fair value."  I'll add a couple of FAST Graphs tomorrow with today's closing prices. (FAST Graphs take a day to update prices)

I also trimmed my position on WAG today on strength.  I own WAG in both my IRA and my taxable account, and the position has grown significantly via price appreciation this year.  In the Chump IRA, it was approaching 4.8% of the portfolio, where the target average size of a full position is more appropriately 3.1%.  My sale takes the position from 4.8% down to 4.4%.

I also closed out an (by selling) a put contract on XOM.  I'll discuss this in more detail in my next post, it was a good learning experience.

That's all for now,



  1. Hi Chump,

    I agree with all your moves and I can't wait to know what you have learn from your experience with the put on XOM... you said you closed out by selling, does that mean you have bought the put in the first place?

    As for IBM, I really like their earning progress. But it remains in the tech sector where everything can happen, like a new competitor or a new tech... which I don't like. For the record, I am long with the intent of watching the game closely on this one.
    I feel much more confident in VMI at this point.


  2. Hey Grox:

    I just posted the XOM blog; meant to say I closed out by buying back the put option. It can be fairly confusing.

    I'm still reading up on IBM and VMI. When did you invest in VMI, and what was your thesis/reason?


    1. VMI: I bought my first shares at $137 and all the way down to $131.
      I discovered the stock via an article from FG and then made some DD on it. What can I say... I like what I found! They are very profitable with nice margins and undervalue now. They are basic industrial with a big portion of the market.