Option Investor

Portfolio Review

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Stocks plunged Tuesday amid concerns over rising oil prices and renewed anxiety about lofty share values. Weakness in the dollar contributed to the high cost of crude, with foreign oil producers charging more for the "black gold" in order to make up for the falling value of the greenback. Consumer confidence was also lower due to slow job growth and the recent mediocre market performance. Although today's news was unpleasant, January's Consumer Price Index, due out Wednesday, could seal the fate of stocks in the coming month if there are additional signs of inflation in the data.

Despite the bearish activity, our portfolio held up very well with only Kansas City Southern (NYSE:KSU) enduring a substantial decline. The issue closed down $0.93 at $18.73 on average volume but with technical support at the sold (put) strike of $17.50, we are not expecting any position adjustments in the near term.

OW Staff

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