Last month was very profitable for our portfolio. On average, the eight positions we held during December gained 3.87% compared to a 0.70% rise in the SPDR S&P 500 ETF (SPY).

That result includes booking a loss in Western Digital (NasdaqGS: WDC) early in the month and closing out an unprofitable position in Athene Holding (NYSE: ATH) this morning.  The rest of the portfolio looks quite solid and poised to deliver another strong performance this month.

As of the end of December we had a triple-digit annualized gain in Signet Jewelers (NYSE: SIG), and may yet end up with another triple-digit winner in BHP Billiton (NYSE: BHP) at the rate it has been appreciating recently (up more than 2% this morning). Commodity prices are on the move, including gold and oil, so these two holdings should benefit from concerns over rising inflation.

Also up sharply this morning is McKesson (NYSE: MCK). Healthcare stocks are trendy again, and as the largest pharmaceutical distributor in North America the company is once again a “must own” stock for many portfolio managers in 2018.

I was concerned that the new mortgage interest and property tax deduction limits may hurt residential builder Toll Brothers (NYSE: TOL), but its share price has actually improved slightly since the tax bill was passed and remains on track to achieve our target return.

With only eleven days left in the target hold period for KLA-Tencor (NasdaqGS: KLAC), it is unlikely we will regain the triple-digit gain we achieved two weeks ago when its share price briefly jumped above $114. We still have a modest profit in this position, and I may extend the hold another two weeks to capture its next quarterly earnings release later this month.

That leaves Xerox (NYSE: XRX) as our only laggard at the moment. It suffered from year-end “window dressing” by portfolio managers over the past two weeks, but I still believe the company will surprise to the upside when it releases quarterly and annual results at the end of this month.

Index Option Trades are on the Way!

I cannot yet divulge all of the details, but we will be making a major addition to the Systematic Wealth portfolio management team later this month. Many of you have asked us for specific options recommendations, so we will be adding index option trades to our portfolio this year. These trades will be shorter-term in nature, usually less than a month, and will have greater liquidity than individual equity trades so everyone can participate. Stay tuned!