In Today’s Issue:

• BWTG outperforms the market

• Are SPACs back?

• Four up days in a row, are we out of the woods?

• Using AI to parse earnings releases

• Using AI to parse clinical trials

• Primer on bullish option strategies

• and more……..

Bottom Line: This market looks like it is expecting a flurry of trade deals. For now, you can slowly add back equity exposure. Keep your head on a swivel and be ready for any rug pull though, it’s unlikely we are out of the woods and Trump could say just about anything. Lots of earnings this week as well.

Brendan Wood TopGun ETF (BWTG)…

Outperforms the Dow, S&P and Nasdaq...

Calm In The Tarrif Storm

April 25th 2025

 Despite severe tariff headwinds BWTG's global portfolio of TopGun* companies outperforms again. This time not for the 42% rate of return achieved in its first fair weather year but for its exceptional calm and resiliency in turbulent adverse markets. Even negative Morningstar ranked BWTG in its first percentile of performance year to date. The portfolio aims to compete more effectively for capital in good and bad times by selecting TopGun companies. Namely, those companies in highest demand by professional investors based upon their investment qualities. BWTG sticks to the Brendan Wood Worldwide Shareholder Network which informs its choice of TopGun investment targets.

*TopGun Companies are selected based upon +/- 2000 personal consultations with large cap global portfolio managers who rate 1400 big cap issuers against multiple investment quality criteria. The top scoring two percent are designated TopGuns.

YTD Rate of Return (Market Price) (Source Bloomberg):

BWTG =  +0.1% (As of April 15th)

DOW Jones = -4.75% (As of April 15th)

S&P 500  = -8.09% (As of April 15th)

Nasdaq = -12.84% (As of April 15th)

Next Webinar:

Tariffs, Inflation, and Recession: What To Do Now

5/22 2pm EST

News & Noise

🧠 News:

Great conversation with Louis, he seems to be in all the same themes we are talking about. Longer term perspective than we have so made for a great conversation….

We run a pre merger SPAC ETF (SPCX), haven’t talked about it much in the last couple of years because the SPAC market has sucked so bad, seeing some signs though……

❌ Noise:

Have to agree with Gayed here, markets aren’t that easy or simple…..

Good luck forecasting the price of Bitcoin, total waste of time…..

What Wall Street Is Saying

UBS Macro Drivers…..

UBS, Global Strategy…..

Tom Simons, Jefferies…..

Stifel…..

JP Morgan, US Equity Derivative Strategy….

Dubravko Lakos-Bujas, JP Morgan

Jefferies, Daily Macro….

Four Up Days In a Row, Are We Out of the Woods?

Fourth up day in a row after a tough start to the week. We are now in sight of the low from Liberation Day……..

This move is starting to look like an uptrend with higher highs and lower lows. Would like to see the 50 day move back above the 200 day and would like to see the price move above both, but I continue to slowly add back equity exposure. For now, expect resistance at those areas if we start to get close.

Long term Treasuries continued to move back up….

Gold miners sold off again, but GDX is holding the 20 day EMA…..

This is concerning….

I continue to like gold because we haven’t really made any trade deals, the market is just rallying on the assumption we will. Things should still be messy for a while, which favors gold. However, we always trade based on what we see, not what we think. If gold and the miners turn into shorts then we will short them.

SLV sold off but held the 10 day….

Bitcoin continues to be strong….

Bitcoin and the related stocks seem to be the strongest area of the market with the least exposure to tariffs, the economy, etc.

My overall thinking hasn’t changed, I think the lows are in and you can add back equity exposure, slowly. We are not out of the woods yet by any means. I think you want a mix of precious metals and miners, bitcoin and crypto related, TLT, mid cap defense, along with all the AI themes that I talk about.

Seeing a few Wall Street firms advising to sell US for Europe, not seeing it myself….

IMHO the US is still the place to be and Europe is just a trade.

Using AI to Evaluate Earnings

CLS is one of the stocks on my watchlist and on Friday they had disappointing earnings. One of the powerful uses of AI is to be able to give you an unbiased evaluation of a company’s earnings release and whether it is a buy, sell, or hold. Here’s what GPT had to say about CLS……

📉 Stock Reaction: CLS –3% on Earnings

Even though Celestica beat and raised across key metrics, the stock is pulling back. Why?

• Expectations were high heading into the print

• CLS has been one of the best-performing AI infrastructure suppliers, so any “less blowout” tone triggers selling

• Market likely pricing in a temporary deceleration in enterprise exposure, despite comm strength

📊 Earnings Highlights – Bullish Takeaways

🔍 Strategic Interpretation

🟢 What’s Working:

• CLS is clearly tethered to the AI buildout. They’re the quiet enabler behind 400G/800G optical networks, boards, and systems.

• Strong acceleration in Comm and Semi Cap = they’re exposed to the infrastructure side of AI, not the volatile end-user side

• Enterprise weakness tied to GOOGL’s TPU transition = not structural

🔴 Risks:

• Market doesn’t give much margin for error right now — this was a “sell the news” setup

• Enterprise remains a drag, and broader slowdown in IT budgets could bleed into late 2025

• Valuation had stretched short-term; pullback may continue if rates stay sticky or if AI hype cools

🧭 Playbook

• Hold / Add on Weakness: This is one of the most fundamentally sound AI infrastructure names, and a 3–5% post-earnings pullback on strong results is a gift

• Watch FCF and Enterprise Trends: If FCF starts slipping or GOOGL-related enterprise headwinds persist, reevaluate

• Pair With High-Beta AI: Consider using CLS as a lower-vol, real-revenue anchor against higher-beta names like SMCI or PLTR

• Optional Hedge: If the AI narrative stalls, hedge with short exposure to overbought end-user names (e.g., ARKK, NVDA options)

Conclusion & Rating

Celestica’s Q1 beat-and-raise, driven by explosive networking growth and an improved cost structure, positions it well to capture ongoing AI and cloud infrastructure spend. While cyclic exposures remain, the stock’s modest multiple, solid cash flow, and analyst upside suggest compelling risk/reward.
Rating: 7/10 — a BUY on strength of secular tailwinds and an attractive entry point after the 3% post-earnings dip.

Using AI to Evaluate Clinical Trials

I’ve been getting more interested in biotech stocks lately and this hit my radar screen….

Of course I’m not an expert on any of this but it looked like the kind of study that could be actionable, so I asked GPT…..

Key Takeaways from the 52-Week PC-rTMS Trial

• Clinical Benefit: Real rTMS slowed CDR-SB deterioration by ~50% versus sham (ΔCDR-SB 1.36 vs 2.45 at 52 weeks) and virtually halted ADCS-ADL decline (–1.5 vs –11.6).

• Safety: Well-tolerated with only mild, transient AEs.

• Biomarker Insight: Better baseline DMN connectivity (TMS-EEG) predicted stronger response — hinting at a patient-selection tool.

Potential Winners

Potential Losers

Ratings (1–10)

• STIM: 8/10 — best pure-play leverage to this trial.

• BWAY: 7/10 — strong technology but smaller footprint.

• BIIB: 4/10 — drug pipeline risk; valuation already reflects headwinds.

• LLY: 5/10 — diversified pipeline but vulnerable on AD front.

Bottom line: If this pilot scales into multicenter trials and ultimately FDA/EMA labels, device stocks (STIM, BWAY) stand to be the big winners, while pure-play AD drug developers (BIIB, LLY) could see incremental pressure on uptake and pricing.

When to Use Calls, Cash Secured Puts, and Risk Reversals

One way you can design trades for asymmetrical risk is to get equity exposure by buying calls. In a bought call you only risk the paid premium and your upside is theoretically unlimited. However, with volatility higher than normal you can be right on direction and still lose money on calls, so I have been using more cash secured puts than I normally do. I had GPT do a deep dive on three of the main ways you can add equity exposure through options…..

1. Buying Calls

When to Use:

• Bullish + Event-Driven: You expect a material catalyst (earnings beat, M&A, FDA approval) within your holding window.

• Low Implied Volatility (IV) Environments: Cheap calls when IV rank < 30%.

Why It Works:

• Unlimited Upside, Defined Risk: You max out your loss to the premium paid; upside is theoretically infinite.

• Leverage: 1 lot of calls controls 100 shares at a fraction of the cash outlay.

Key Considerations:

• Time Decay (Theta): Accelerates in the last 30 days to expiration. Avoid deep out-of-the-money calls and very short DTE unless you’re playing a near-term catalyst.

• Vega Exposure: Buying calls is long vega—you want IV to stay flat or rise.

Example Entry:

• Stock at $100, IV rank = 25%.

• Buy the $105 strike one-month call for $2.00 (breakeven $107).

2. Selling Cash-Covered Puts

When to Use:

• Neutral-to-Bullish View: You’d happily own the stock at a lower price and want to be paid to wait.

• High Volatility Regime: IV rank > 70% lets you collect rich premiums.

Why It Works:

• Income Generation: You pocket premium up front; time decay is on your side (short theta).

• Lower Cost Basis: If assigned, your effective purchase price = strike – premium.

Key Considerations:

• Capital Commitment: You must reserve full cash to buy 100 shares per contract at strike price.

• Downside Risk: You’re short delta and will be assigned if the stock gaps below your strike.

Commentary on Recent Activity:
With IV skyrocketing—thanks to Fed jitters and earnings season—you’ve smartly leaned into cash-covered puts. Premiums are at cyclical highs, so you’re getting paid >$3.00 for strikes 5–7% out of the money on many large-caps. Just be sure to pick strikes where you’d actually want to own the shares, and size positions so a single assignment won’t blow out your portfolio.

3. Risk Reversals (Synthetic Long)

Structure: Sell an out-of-the-money put and use the premium to help buy an out-of-the-money call.

• Net Zero or Small Debit/Credit: You can structure it so it costs little or even nets you credit.

• Directional Exposure: You’re synthetically long the stock above the put strike.

When to Use:

• Moderate Bullishness + High IV Skew: When puts are richly priced relative to calls.

• Desire to Cap Funding Cost: Use rich put premium to fund long call exposure.

Key Considerations:

• Unlimited Risk Below Put Strike: If the stock crashes below your short put, you’re assigned and suffer full downside on 100 shares.

• Complex Management: You need to monitor both legs for assignment risk and roll as necessary.

Strategy Attractiveness Ratings (1–10)

Bottom Line:
In today’s volatility-rich market, cash-covered puts sit at the sweet spot of yield and risk—you’re being generously paid to set a lower strike entry on names you like. Risk reversals are your tactical hedge if you want upside participation funded by that same fat put premium. And buying calls still earns its keep around key catalysts—but only in spots where IV is depressed and you can withstand theta bleed.

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