SHARPE INCOME … Waiting on the Market

Posted on Aug 17 2015 - 7:09am by Sharpe Trade

The original Sharpe Income post that explains this project can be found here.

The Sharpe Income category be found by clicking on that red ‘Sharpe Income’ tag next to this post title, or by clicking here.

We continue the discussion from the last entry.


Of the capital contributed this week, we moved 92% of this contribution towards the category reserved for purchasing our capital gains assets.  The remaining 8% of the capital contribution was placed towards cash that we simply have ‘on-hand’ in the form of ‘dry powder’ …

Sharpe Income Project Cash Allocations Dividend Best Investing

We are concentrating on building cash for the capital gains assets.  On the side, we have some money building up in the background for ‘cash that serves as dry powder’.   And at any time, we could buy Union Pacific (UNP) for an income asset, as we have the cash reserved, and ready to go to purchase it.

So is there anything we could purchase this week?

Well, yes.

But is there anything we could purchase, and it make sense?  Would it be practical to make any moves this Monday?

Well, we could purchase the Emerging Markets ETF (PCY).  I’d like to pick up another 9 or 10 shares of PCY.   However, if you look at pure price action without any technical tools you will note there are a lot of selling candles for the last 20 trading sessions.  There is never any guarantee, but I would tend to think that this support at $27.48 could be violated to the downside, with all of that selling pressure behind it.  Which is a good thing.  If it falls farther?  I can buy more PCY for the capital gains strategy, lower my cost basis, and have a better yield.  So for the time being?  I just have to wait on the market.  If she breaks this support level of $27.48 … then I will simply wait in order to buy PCY at a better price.

Emerging Markets Debt ETF (PCY) (via tradingview.com)

Emerging Markets ETF PCY Dividend Yield

What about Union Pacific (UNP)?

Well, again … we have the capital to purchase Union Pacific (UNP), but the stock hasn’t really shown any signs of life.  Yet …

Union Pacific Corporation (UNP)  (via tradingview.com)

Union Pacific Chart UNP Dividend Yield Income

In fact, unless we get a daily close above $96.75?  I don’t see any reason to purchase Union Pacific (UNP) at this time.   And let me be clear, a daily close above $96.75 would only begin to interest me.  I wouldn’t necessarily purchase Union Pacific at $96.75.  I’d only be interested at that level.   If she slides through the support at $91?  Great.  Then let it move lower.  As with PCY, if UNP breaks below $91, I will simply wait in order to buy UNP at a better price, and yield.

Long term core positions take a tremendous amount of patience to observe, and wait for the right time.

And even then there is no guarantee. Which is why we diversify our longer term core positions.  

The link to the Google Drive Spreadsheet that you can view, that we will edit, build upon and refer to over time can be found at this link.

We continue the Sharpe Income project with this next entry.

The Sharpe Income PDF breakdown for Week 38 can be found here (numbers computed off of Friday’s close) …

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