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Wednesday, June 4, 2014

Homie Hopper

Somehow I got dragged into (very strong) Home Builders Theme (label XHB), may be because of indifference to all matters real-estate I see everywhere. May be because I actually see new developments by many of companies from these lists. May be because I actually use many products myself.
For a past couple of years, most of my interest was inside this old
 Very strong housing and real estate sector list:
I traded XHB and mut fund back in 2012 and beginning of 2013, followed by a nasty sideways-to-down period I was lucky to sidestep. Several short REIT's trades (via SRS) ended in overall profit in 2013. Real Estate decidedly recovered, and I'm long IYR in LB account since April 2014. Would love an opportunity to switch to REM, like I noticed here (link), but why 'fix it, if it's not broken'?

Home Builder stocks don't look too hot, ignored or dismissed by media, display absurd valuations and high short interest. After choppy 2013, its not going to take a lot to send them 10-20% up, while support is well defined and only few percent away. The best thing about it is - whole bunch of them are correlated, so I can hop from one to another in BCM account without worry about wash sales. XHB will go into LB account on any entry signal. If Homies really bottomed, if this overlapping sloppy mess since February top was only a correction, if this economy worth anything at all - then XHB shall leave its 200day MA and depart north...and soon...
Here are Home Builders: (I like XHB thru TOL)

Building Materials are a large group themselves. Here are profitable ones, with billion-dollar companies on a bottom! High P/E's here attracted some short interest. Charts worth watching, can break either way
Then there are assorted odds-n-ends:
Retailers, Wholesaler LPX, bunch of lumber companies in disarray, lonely manufactured housing CVCO, and cement
There is also Property Management, that is also very strong, I'm just not sure what it is...

Steve Eisman of 'Big Short' fame was talking about Homie's boom at recent investment conference
He's got builders, land, financials and may-be more

Lets say I'll see about these for Homie Hopper 2014:

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