We’re trimming this bank stock after its curious 4% surge Monday erased its post-earnings losses
Shortly after the opening bell, we will be selling 75 shares of Morgan Stanley at roughly $89.86. Following the trade, Jim Cramer’s Charitable Trust will own 1,400 shares of MS, reducing its weighting in the portfolio to 3.78% from 3.98%. We took a stab on Monday’s Homestretch trying to figure out why Morgan Stanley was one of the top performers in the S & P 500 , jumping 4.12% to kick off the week. However, after not seeing any specific catalyst after the closing bell and overnight, we are feeling unsatisfied about the lack of news. Therefore, we see this pocket of strength as an opportunity to peel back some stock and make room in the position to buy in case the stock pulls back again. The stock is about flat from our oldest lot of shares dating back to July 2021. In addition, at Monday’s closing price of $90.04 per share, the stock has fully recovered all its losses tied to its fourth-quarter earnings report . On this rebound, we are moving our rating back to a 2. Lastly, we are gearing up for our annual contribution to charity. As a reminder, every year we donate all dividends received and realized capital gains. The preliminary figure of this year’s contribution is $157,500, which would bring our total donation since the inception of Jim’s Charitable Trust to approximately $4.3 million. We’re hoping to make this contribution before the end of the week. With our current cash position of $461,529, representing 13.83% of the portfolio, we have plenty of cash on hand to fund this year’s distribution. However, we still would like to maintain a cash position of roughly 10% after the money goes out the door so we are ready to buy if the market sells off. This sale will get our post-distribution cash position closer to 10% from about 9.5% pre-trade. (Jim Cramer’s Charitable Trust is long MS. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
Read the full article here