Tuesday, September 29, 2009

We Were Right, Something Was Starting To Smell At Sequenom

So it's all bad news. The Downs test is no good and everyone was fired and they don't know when things get right. I sold my stock, as I have no tolerance for bad behavior. This one was a big loser and I thought we might be in for it in mid August (see my post on 8/15), but the upside was too tempting.

Look out below on this one, as those two big holders will more than likely be forced to sell to salvage what's left. Remember them from last time. Those staying long may see some relief, as there is large short interest and they may decide to cover. Shame on management and shame on PaperGains for falling asleep on this one.

Part of being a good investor is knowing when to cut your losses and I can find better places to put that money going forward.

Now we know what was taking so long, they were reading those 300,000 documents. They can't all be winners, but when I lose, I like to lose for the right reasons.

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Saturday, September 26, 2009

Great Quarter And Month

So September was suppose to be a terrible month, so much for that. Not only was the quarter great, but with a few days to go, dreaded September is shaping up to be great as well. For those that didn't get in at some point over the past 6 months, they're going to be chasing stocks these next 3 months.

As for the 'talking heads' on the two main business networks. They sound like broken records. For months, we had to listen to them say the same thing, "...the market has gotten ahead of itself..." These people need to wake up. Had you listened to them, you'd be standing on the sidelines, cash in hand, watching the rest of us make money.

Just my 2 cents. I will be updating our '2011 Model Portfolio' next week and the numbers are crazy! For new readers, search older posts under stocks for the picks.

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Sunday, September 20, 2009

A Portfolio Allocation Exercise



After hearing horror story after horror story from people close to retirement and people with children about to enter college being set back years because of the rout in the market I thought walk through the subject of 'portfolio allocation' with this short presentation.

Have a look at the following presentation through the player above or the link provided. Portfolio Allocation. It's larger and you have a bit more control here.

Wait a few seconds for it to begin after starting.

This is a very basic explanation to give you one of the ideas behind properly allocating your portfolio over time.

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Thursday, September 17, 2009

Tee Up Arena, Big Announcement In The Morning, UPDATED

Arena Pharma (ARNA) is up in the morning with phase 3 results for their weight loss drug Lorcaserin. This is part 2 of a 2 part trial and while VVUS wowed everyone with their results earlier this month, critics expect ARNA results to be less than stellar. Short interest in the stock is more than twice that of VVUS and both the short interest and lowered expectations should create a potentially huge move in one way or the other.

I'm holding the stock and yes, my fingers are crossed.

I believe the competition between ARNA, VVUS and OREX is good for the stock prices, as it creates a whole lot of buzz! See you in the morning.

And what's going on with DNDN - huge move on no news.
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So the news is out. Lorcaserin met one of the FDAs requirements which is good enough. Most important, there were no safety issues. Company moving forward with FDA submission in December.

Here's the skinny- the numbers look good, not great, but good. See the press release for the details. I expect the short side of the trade to bash heavily, as there are many, many shorts and Friday is options expiration which complicates things. Don't be surprised if you see a rash of negative analyst reports. In the intermediate to longer term, the drug should be approved and when you consider teh rest of the drugs in their pipeline, I believe the stock is worth holding for a few years.

There's my 2 cents.

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Monday, September 14, 2009

Our Big Winners Continue To Move Higher

Since March, I've mentioned more than a few stocks I thought were screaming buys and I have to admit, I'm not surprised that many of them have gone through the roof! Remember these picks - DOW, GE, GNW, HIG, SWIR, DNDN and I could go on. We've had no losers here, as even Arch Coal (ACI) is starting to come around.

Some of these names are up more than 10x. I see most of them moving even higher and although I've sold a little, I'm still holding a lot.

By the way, ignore the rumors about Dendreon (DNDN) being bought. Just another lie spread by dubious traders.

My thesis is still in place. Many professionals are behind their benchmarks and are going to be chasing stocks in the 4th quarter trying to catch up. With that typed, I'm looking for a crazy 4th quarter.

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Wednesday, September 9, 2009

Let The Buyouts Begin

Like many other investors/traders, I've been waiting on well capitalized companies to start buying the not so well capitalized. I also expect a flurry of activity in the biotech space. We're already starting to see a pick up in M&A and I'm betting on a lot more.

I expect a pick up in the industrial and metals space, as many of these companies had one foot in the grave over the past year. I find the biotech space just as interesting, as big pharma has to be salivating at the prospect of buying one or more of the small biotech firms with very promising drugs. Investors who do their due diligence and cast a wide net should do good here.

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Biotech September Marches On Updated

So Spectrum (SPPI) fell flat. The company received expanded approval for its cancer drug, but the powers that be took it down and the situation looks bad. I suspect the sell off will be short lived, but so much for 10+. The timing of the analyst downgrade was suspicious of course. He waits until the news is out and downgrades on valuation and the stock price is where it was days ago, but with better business prospects now.

Next up Vivus (VVUS). The company released a statement after the close on Tuesday saying they would release Phase III results for their obesity drug before the market opens on Wednesday. So I'm waiting, as I'm holding long. For those that don't know VVUS' drug is competing with Arena's (ARNA) obesity drug. Arena has the deeper pipeling, but VVUS tends to be more volatile.

Pick your poison. I picked some of both. More of ARNA, but some of both. Remember, with these little biotech stocks, a little goes a long way. Think of them as concentrated stocks.

UPDATED: Looks like VVUS is a winner and up more than 70%. It also looks like it's dragging many of the other biotechs higher. Put a check mark by VVUS, another winner.

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Sunday, September 6, 2009

Previous Market Poll 31Aug-4Sep

When asked "Will the S&P 500 sell off in September", 60% responded "Yes" (lower by 5%) and 40% responded "No" (higher by 5%).

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Tuesday, September 1, 2009

Another Day, Another Rumor

This time the rumor is about Wells (WFC). Who really believes that Wells is about to fail? It's hard to believe people are actually talking about it like it's a real possibility. I'd like to draw your attention to the large number of puts around 24, 25, and 26 that are set to expire in less than 3 weeks. Call me cynical, but my money says whoever owns those options might be behind the rumor (lie)!

Anyway, this was expected. There are lots of dubious characters out there betting on a market sell off in September/October and they're willing to do most anything to get it. Actually they've been betting on a sell off since May. We're due for another pull back either way. Let's take a breather now and sprint to the finish in Nov/Dec.

For those with long term positions, this is just a blip. If you have short term positions, it might be prudent to ditch and buy back, as a large, sudden sell (especially at the beginning of the month) usually signals more selling over the next 2 to 3 weeks.

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The Vix

About This Blog

Where we rant and rave about the market and of course give our opinions on stocks we love or hate. We're not advisors and urge you to conduct your own due diligence.

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