Update - ISRG, Close CTXS and General Commentary

Close CTXS
I am closing my Citrix options position after pocketing a neat 34 % gain (sold the call options at $9.30). My observation in the last post that CTXS would see a gain in its stock price after the earnings release was accurate. How we love these quick profitable trades!

Portfolio Note
We have done extremely well given the mood swings of Mr Market. Our portfolio for closed positions is standing at a gain of 32%. As always detailed tracking is at the bottom of this post. Regular readers of this FREE blog must be smiling at least a tad bit. And that just goes on to prove one thing - there is such a thing as free lunch after all :)

ISRG - the Monster Trade with Monster Gains!
ISRG stood out in our portfolio like a knight in double shining armor! ISRG's earnings trounced the short bets and the stocks went up a whopping 35 % plus in the last three days. Since we were doing options trading, the position went up by more than 100 %! Of course it is all fluff until we get the money in the bank. Given the price momentum I continue to expect ISRG to benefit a bit more from its own trend. But if the overall markets go down, ISRG may unfortunately be a victim and get dragged down since there are no other catalysts. Remember ISRG is part of Nasdaq 100. Therefore market movements do have an impact on its share if there are no other catalysts. The only possible catalyst left in the near term is if the management decides to split the stock. I highly doubt this since I am guessing management would want to discourage excess speculative trading. So bottomline action item on ISRG - We will continue to closely monitor and look into taking half off the table in the next day or so. We will let the rest ride with a tight trailing spot. This will allow us to pocket profits and at the same time participate in any more upside surprises.

Market Commentary
As observed in the last few posts, the volatility remains high and the predictability scores low on market swings. Overall short term trend in my opinion is remaining neutral to bearish. Surprise positive earnings could always sway the markets higher. One good example is American Express, which reports after the Market close today. It could be a good short term trade because just like Citrix, I expect Amex shares to go higher. There are several reasons but the key is there may have been some amount of understimation on the usage of plastic on Internet. That said, speaking for overall market, given the seasonality and nothing much to move ahead with, traders may use this excuse to take some profits off the table, which is a wise strategy anyways.

TSO was a prescient call in my last update on this stock. After we sold off TSO for the reasons cited, those very conditions were responsible for its further slump. We will continue to monitor TSO and either enter back into it or look for a more integrated oil company to take advantage of energy prices.

Barrons had an interesting article this weekend. It observed that the individual investor aka "the little guy" hasn't yet stepped in and most of the trading is occurring at the institutional level. Barrons argued that when the little guy steps in we would have another upswing of the markets. While I agree with Barrons point of view, the chances of that happening are when the sentiment indicators change a bit more reflecting more of the individual investors' optimism. Also what I think could be added to the above observation is my comment from one of the past updates that we would most likely have another round of buying from foreign funds as well before the year is out.

We will continue to monitor the markets. Stay tuned.

The Rathi Portfolio Holdings Open List

Open List
GLD - (Equity trade) buy long (Opened at 65.61 on 7/10/07
PLUG - (Equity trade) buy long (Opened at 3.25 on 7/16/07)
BZH - (Equity trade) sell short (Opened at $41.54 on 2/14/07)
ISRG - (Option trade) buy Jan 2008 Calls $130 strike (Bought at 9.60 on 3/8/07) Closed List

Closed List
CRDN - closed at 79.37 - 40.63% Gain
TSO Jan 2008 50 Calls - closed at 12.7 - 11% Loss
CTXS Jan 08 30 Call Option - closed at 9.30 - 34 % Gain

Overall Gain/Loss of Closed Positions - 32% Gain