We have been writing about and have held bearish investments in Whole Foods Market (WFM) for nearly all of 2016. Our first strategy – a “bearish call spread” – was detailed in a Tear Sheet dated December 30, 2015, which generated realized returns of 22% over its 142-day duration.
Our second strategy was a repeat of the first, and was published on July 7, 2015. Assuming that Whole Foods Markets’ share price ends today at a price of $35.00 or less (it is presently trading for $30.75), we will have earned 28% returns on our capital at risk over 134 days, for an annualized return of roughly 98%.
During the period of our second Whole Foods investment, the S&P 500 Index increased by 4.25%, so our period return of 28% again handily beat the market while also providing bearish exposure and acting as a hedge.
Selling 10 contracts of this position would have just about paid for the IOI 100-Series Course and three months of web-based learning support!
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