Closed with Stop-Loss, loss is about 14.04%

BITCOIN
(BITSTAMP:BTCUSD)

Ticker: BTCUSD
Buy: market ($9393)
Take profit: $12000
Stop-Loss: $8400
Updated Stop-Loss: $8100 (08.11.19)

On 09.08.2019 the shares reached price $46.5. Investment idea brought about 9.64% yield in 24 days

Interactive Brokers LLC
(IEX: IBKR)

Ticker: IBKR
Sell: market ($51.13)
Take profit: $46.5

Interactive Brokers (IEX: IBKR) is an American brokerage firm that was founded in 1978. IB owns the largest trading platform in the US which has the highest number of deals per day (more than 800,000 completed assignments). It gives access to stocks, options, futures, bonds and funds. The company is traded on the IEX stock exchange.

We suppose that the company is oversold in comparison to its competitors.

	InteractiveBrokers (IEX: IBKR)	TD Ameritrade (Nasdaq: AMTD)	E*TRADE Financial (Nasdaq: ETFC)	TheCharlesSchwab (NYSE: SCHW)
PE Ratio (TTM)	22.32	14.38	11.15	15.52
PR Ratio (TTM)	8.99	4.91	3.58	4.67
Dividend  Yield	0.77	2.35	1.22	1.69

In our opinion, the company is developing slower than its competitors and is missing the retail market.

- TD Ameridate enables cryptocurrency purchases in collaboration with ErisX.

- Robinhood has adopted a subscription model and doesn’t charge for trading. It currently has more than 4 million users.

- Schwab offers a product called Intelligent Portfolios for automated creation of investment portfolios.

Additional pressure on IB’s business might soon be caused by the following events and factors:

- Decreasing interest rates policy will reduce the cost-effectiveness of the brokerage business.

- The potential introduction of a tax on operations with securities that has been proposed by Bernie Sanders, the Democratic presidential candidate. If the tax was introduced, as a broker-discounter with the lowest margin, IB would suffer considerable losses due to the decreased number of operations and the business’s profitability.

Nevertheless, the company has several strong points which are the reasons for the cautious approach to the short-selling of the security. For example, IB has recently launched a major advertising campaign for a sports betting simulator. It is quite an interesting strategy of attracting those users who are inclined to take risks. A user has 1000 USD on his or her virtual account. The money that has been won by betting on sports event could be used to pay for commissions on the Interactive Brokers trading account.

Additionally, many fintech companies are using IB as a primary broker when providing services to their customers because IB doesn’t have its own positions and is one of the most reliable partners in the industry.

Technical analysis

The following patterns can be clearly observed on the graph:

- strong resistance on the level of $58-$60 starting in September 2018;

- attempts to reach SMA 100 were unsuccessful during the past year;

- the price is trying to break of the upward trend since April 2017. A similar attempt took place at the end of May 2019 and on July 15, 2019.

Another argument to support the security is that its correction from the overall progression already amounts to 50% since 2018 whereas the oscillator is in the zero range on daily and weekly graphs.

We are opening market short on a half of funds allocated for the idea, we plan to average the other half in case of the price reaching $55. IBKR is one of the few short positions in the portfolio, that’s why we do not set a stop loss for this investment idea.

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03.12.2019 shares were sold at the price of SL $150. The investment idea brought 2.55% return in 69 days.

VMware
(NYSE: VMW)

Ticker: VMW
Buy: market ($146.19)
Take profit: $185
Stop-Loss: $123
Updated Stop-Loss: $150 (28.10.19). Stop-Loss is shifted to breakeven.

VMware (NYSE: VMW) – American company, the largest softer developer for virtualization, founded in 1998 with Headquarters in Palo-Alto, CA, USA

In a Q2, VMware announced about two major acquisitions:

• Carbon Black (Nasdaq: CBLK) – cybersecurity field of expertise. Developing could storage solutions aiming to detect unverified activity on the web. Among more than 5000 clients, there are such companies as DocuSign (Nasdaq: DOCU), Evernote, Adobe (Nasdaq: ADBE).
• Pivotal Software (NYSE: PVTL) – the company building infrastructure for the development of scaling software products and applications. Major company’s clients are Boeing (NYSE: BA), Bloomberg, Orange (EPA: ORA), T-Mobile (Nasdaq: TMUS), Ford (NYSE: F).

We assume that such strategic acquisitions will lead to synergetic effect. After integration of the companies VMware clients will be able use a full pack solution for secure virtualization and scaling of software infrastructure. Moreover, VMware will enlarge customer base with some big names in it.

Financial indicators: Q2 2019:

• During the second quarter VMware performed a $2.44 billion revenue, which is 12% higher comparing with same period last year.
• Revenue from licence sales was more than $1.1 billion, 12.3% more than last year for the same timeframe.
• Revenue from services offered was $1.43 billion, 12.1% more than last year for the same timeframe.

Financial statements illustrate revenue increase higher than the market expectations were.

Through our analysis we consider that correction, which was a result from acquisition activity, is finished now. And for the moment company’s stock price will benefit from boosted financial performance.

Technical Analysis

+

Correction started in May ’19 was more than 35%, what is deep enough for the renewal of upward trend.

Correction bottomed at $129 p/share – January ’19 levels.

SMMA 100 on the weekly graph suppressed the downfall at $130 p/share

-

Correction from the last movements was less than 50%, therefore there is a possibility to go back to the level of $120- $125 p/share.

SMMA 50 indicator on the weekly graph is equal to the current value of the share, which could prevent the upcoming rally.

 

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On 19.06.2019 the shares were sold at price $34.26. Investment idea brought about 6.4% yield in 27 days

Brookfield Renewable Partners L.P.
(NYSE: BEP)

Ticker: BEP
Buy: market ($32.21)
Take profit: $34.5
Stop-Loss: $30.5
Updated Stop-Loss $32.5 (14.06.19)

In a period of uncertainty caused by Trump’s current policy, we recommend adding a dividend position to your portfolio - Brookfield Renewable Partners L.P. shares. (NYSE: BEP).

Brookfield Renewable Partners L.P. owns and manages renewable energy assets. The company was founded in 2011 and headquartered in Toronto, Canada. As of the end of 2017, Brookfield Renewable owned more than 200 hydropower plants, 100 wind power plants, more than 550 solar installations, and four storage facilities.

The total volume of generating capacity owned by the company is about 7.25 megawatts, which is currently 8.2% more than a year earlier. 75% of power is produced by hydroelectric power plants. The remaining volume is also generated from such renewable sources as wind and solar stations.

Over the year, Brookfield Renewable Partners' net income increased from $8 million (Q1’18) to $43 million (Q1’19).

The company's FFO (funds from operations) grew from $193 million (Q1’18) to $227 million (Q1’19), showing an 18 percent increase over the year. FFO is a key indicator for companies that own generations. It reflects the cash flow from the main activity, which is the sale of electricity in our case. It is calculated as follows: depreciation is added to the net profit of the company and the profit from the sale of generating stations is subtracted.

In Q1 2019, a hydroelectric power station was put into operation in Brazil, with a capacity of 19 megawatts. In addition, 134 megawatts of renewable energy was launched worldwide.

Dividends from the activity for the 1st quarter of 2019 grew to $0.515 per share (or 1.6% of the share price on May 22) and will be paid on June 28, 2019, to shareholders on the register dated May 31, 2019.

Technical analysis

The share overcame a strong resistance formed by the multi-year level near the $32 borders, as well as a downward channel from the highs of 2017. In a positive scenario, the price may return to the range of $31.5- $32 and resume its movement to the intended target of $34.5 from there. We set SL at $30.5 in order to keep the risk/return ratio close to 2.


While maintaining the current rate of new generations launching, we expect the stock price to grow to $34.5. Taking into account the dividend payout, the yield potential will be 8%.

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