Tuesday, December 6, 2011

The new, new normal

Have you noticed how stocks go round and round, then sometimes rally for a few months then sometimes sell off for a few months, but most stocks seem to have no intermediate or long term direction? Well, get used to it. I've written about this in the past and here it is again. Our markets are dominated by algorithms and people sitting in back rooms next to computers.

If you need proof, read this article if you haven't already, HFT. The article discusses how a high freq trading firm was fined (peanuts) for sending the market into a tailspin down, more than once. So what I take from that is, regulators know they can do it, we saw it on May 6th 2010 with an exclamation point, but regulators say please don't do it. You know what ends up happening, they just do it so it isn't as noticeable. Think about it, if you could move the market at will and as long as you didn't get too greedy you wouldn't get into trouble, wouldn't you do it? It's sort of like the shorting stock, but not borrowing it. Traders do it all the time and regulators say don't do it, but do nothing to them.

I asked over a year ago if you thought it was market manipulation to buy and sell stocks, not to take part in future movement, but to cause movement in those stocks. You overwhelmingly voted 'yes'. We agree here. In case you don't know, the real money is made in the derivatives markets - take positions in the derivatives, then move the underlying stocks, then make a fortune. It's called leverage. Why make $1 when you can make $5 risking the same amount of capital. Dubious people are making a fortune there. This is why dividends are so important to us regular people, as well as being able to stay with it and not be forced out by being on margin.

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Monday, November 28, 2011

A few thoughts on a few things

I thought I'd throw a few ideas your way. This market is tricky and not to be trusted. We're in that type of market where trading can be dangerous. Volatility is all over the place, rumors are rampant, and that can also create opportunities for the patient investor.

Remember SQNM, we picked up a little. Couldn't resist down just under $4. If their Down Syndrome test works as advertised, it should be a real bread winner. Let's not go to sleep on ARNA, yeah, we said it. VVUS has already taken off in anticipation of next year. At $1.40, a little ARNA seems cheap. Here's one more little biotech, ASTM, which we've held for well over a year and will probably hold for years. We don't have a lot, but a little (stem cells and such). In a few years it might turn out to be a huge deal. Finally, drum roll please, couldn't resist adding BAC to the mixing bowl. With a market cap of $50 billion, which is less than Citi, half of JPM, and less than half of Wells, and still being the second largest bank (or maybe the largest) in the country, it's a risk we'll take.

By the way, these are side bets and we could change our minds at any second, or might hold them for a year or longer. Just a few thoughts. Also, still working on summarizing the 2013 MP.

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Sunday, November 13, 2011

Picking fruit from our trees UPDATED 13 Nov

13 Nov - We added, NutriSystem (NYSE: NTRI) to the MP at a hair over $11, so cal it $11. This one is a little different, as revenues are off from a year ago and it's another small cap. The good is it's got that 6% yield and obesity is such a huge deal that I think there's enough to go around between NTRI and WTW. NTRI needs to get their marketing machine working and hire some celebs that need to lose weight. This also adds some good diversity to the MP. Some of you may notice a trend, as we have many stocks that boast hefty dividends and some that offer high potential growth and some that offer both. We didn't want anything in between. We expect to get paid in some way and if you're not paying a nice dividend, then you better have big upside. We'll summarize this and find a good way to track against the S&P on a risk adjusted basis.

23 Oct - We added Freeport (NYSE: FCX) to the MP at $34. We thought long and hard about CLF or FCX, but opted for the exposure to gold rather than iron ore. Also, the 3% yield is nice. Wish we had pulled the trigger under $30, but we'll live. There may be a bumpy road ahead, as the economy is on shaky ground which means copper demand will be uneven, but things will be up and down over the next 2 years and when they're up, this stock will take off. So one more spot left and I've got an idea.

2 Oct - We added MetroPCS (NYSE: PCS) to the MP at $8.70. I gotta believe this ATT/T Mobile potential deal is a positive for this company. If the deal goes through, Verizon, Sprint, or some unforeseen entity will be pressured to step up and buy them. If the deal doesn't go through, then great for PCS. In addition,wireless is just where everything is going, land line are dead. The wireless companies are the new mob, joining the cable companies. Getting online is critical and these two industries rule that. The stock is beaten up, but over the next couple of years they should emerge as the number 3 player in this space if they aren't acquired.

That's 8 spots taken. By the way, we know the portfolio has been beaten up lately and the fall has been dramatic in both the market and our portfolio, but none of these companies are going out of business and knowing we plan to hold into 2013 gives us comfort. Some of the sectors like solar and China Internet have been killed to the point where it's become ridiculous. This is when you buy.

10 Sep - I know we were reluctant to touch the insurers 30 days ago, because of European exposure concerns, but one of our old friends Hartford (NYSE: HIG) doesn't have much of that, so we're adding HIG to the list at $16.75 it's a bargain. We don't believe it or most of the other insurers fully recovered from the beating they took over the past few years. It's a solid name and has a 2.3% yield in here with book value over 40, we like it. While we looked at Genworth, there's still that uncertainty over the mortgage business and the potential restructuring down the line and no dividend to keep us warm at night.

We're adding another combo play, Renesola (NYSE: SOL) at $2.90 and Trina Solar (NYSE: TSL) at $10.50. These two stocks will hold one position. This sector has been beaten down to the point of absurdity. I think the real problem is there are too many solar companies and many need to go away. There's tremendous upside here and very little risk over the next couple of years. It's dangerous picking just one, as who knows who's going to survive, so we pick two of the bigger, better run companies. These companies are running out of cash and they have the scale and management to outlast and out do the competition. Also, both these names are heavily shorted which could provide some lift on good news.

That's 7 down and 3 to go.

22 Aug - So DANG appears to have been targeted by short sellers. Got hammered today and I didn't notice it was on the Reg SHO/Threshold list until today (been there for a while). For those of us who can wait it out, we should see a nice pop, eventually.

20 Aug - Adding a combo play Dangdang (NYSE: DANG) at $7.90 and Renren (NYSE: RENN) at $7. This position will hold one spot in the portfolio, so it's a split. This is our speculative play and gets ups good exposure to the Chinese consumer and both companies increased revenues by over 50%. Some of the negative news around these names doesn't bother me as I heard the same stuff about Baidu and Ctrip and Sina.

14 Aug - Adding Frontier Communications (NYSE: FTR) at $6.95 and that fat 10.8% yield.

So Cisco (NASDAQ: CSCO) had a good quarter so in to the bag it goes. At this price, why wait. We're adding it tomorrow, say we pick it up at $14.50 given where it'll probably trade. We're also adding Petrobras (NYSE: PBR) to the portfolio at $26.50. This is the oil company of the future and this is a dynamite price.

Remember, we're going to pick 10 names and spend equal amounts on each. So far we have NVTL, CSCO, PBR, FTR, DANG/RENN, HIG, SOL/TSL, PCS, FCX. We'll summarize them when the list is complete.

Read more...

Sunday, October 23, 2011

Picking fruit from our trees UPDATED 23 Oct

23 Oct - We added Freeport (NYSE: FCX) to the MP at $34. We thought long and hard about CLF or FCX, but opted for the exposure to gold rather than iron ore. Also, the 3% yield is nice. Wish we had pulled the trigger under $30, but we'll live. There may be a bumpy road ahead, as the economy is on shaky ground which means copper demand will be uneven, but things will be up and down over the next 2 years and when they're up, this stock will take off. So one more spot left and I've got an idea.

2 Oct - We added MetroPCS (NYSE: PCS) to the MP at $8.70. I gotta believe this ATT/T Mobile potential deal is a positive for this company. If the deal goes through, Verizon, Sprint, or some unforeseen entity will be pressured to step up and buy them. If the deal doesn't go through, then great for PCS. In addition, wireless is just where everything is going, land line are dead. The wireless companies are the new mob, joining the cable companies. Getting online is critical and these two industries rule that. The stock is beaten up, but over the next couple of years they should emerge as the number 3 player in this space if they aren't acquired.

That's 8 spots taken. By the way, we know the portfolio has been beaten up lately and the fall has been dramatic in both the market and our portfolio, but none of these companies are going out of business and knowing we plan to hold into 2013 gives us comfort. Some of the sectors like solar and China Internet have been killed to the point where it's become ridiculous. This is when you buy.

10 Sep - I know we were reluctant to touch the insurers 30 days ago, because of European exposure concerns, but one of our old friends Hartford (NYSE: HIG) doesn't have much of that, so we're adding HIG to the list at $16.75 it's a bargain. We don't believe it or most of the other insurers fully recovered from the beating they took over the past few years. It's a solid name and has a 2.3% yield in here with book value over 40, we like it. While we looked at Genworth, there's still that uncertainty over the mortgage business and the potential restructuring down the line and no dividend to keep us warm at night.

We're adding another combo play, Renesola (NYSE: SOL) at $2.90 and Trina Solar (NYSE: TSL) at $10.50. These two stocks will hold one position. This sector has been beaten down to the point of absurdity. I think the real problem is there are too many solar companies and many need to go away. There's tremendous upside here and very little risk over the next couple of years. It's dangerous picking just one, as who knows who's going to survive, so we pick two of the bigger, better run companies. These companies are running out of cash and they have the scale and management to outlast and out do the competition. Also, both these names are heavily shorted which could provide some lift on good news.

That's 7 down and 3 to go.

22 Aug - So DANG appears to have been targeted by short sellers. Got hammered today and I didn't notice it was on the Reg SHO/Threshold list until today (been there for a while). For those of us who can wait it out, we should see a nice pop, eventually.

20 Aug - Adding a combo play Dangdang (NYSE: DANG) at $7.90 and Renren (NYSE: RENN) at $7. This position will hold one spot in the portfolio, so it's a split. This is our speculative play and gets ups good exposure to the Chinese consumer and both companies increased revenues by over 50%. Some of the negative news around these names doesn't bother me as I heard the same stuff about Baidu and Ctrip and Sina.

14 Aug - Adding Frontier Communications (NYSE: FTR) at $6.95 and that fat 10.8% yield.

So Cisco (NASDAQ: CSCO) had a good quarter so in to the bag it goes. At this price, why wait. We're adding it tomorrow, say we pick it up at $14.50 given where it'll probably trade. We're also adding Petrobras (NYSE: PBR) to the portfolio at $26.50. This is the oil company of the future and this is a dynamite price.

Remember, we're going to pick 10 names and spend equal amounts on each. So far we have NVTL, CSCO, PBR, FTR, DANG/RENN, HIG, SOL/TSL, PCS, FCX. We'll summarize them when the list is complete.

Read more...

Monday, October 3, 2011

Frontier is even more interesting

Frontier (FTR) paid the usual dividend today and the Board said they intend to keep paying the say dividend. What more do people need? Shorts are trying to force a dividend cut, but I don't see it happening. The yield is over 12% now and the stock is around 5.5. Oddly enough, the Jan 13 calls look expensive at $5 and $7.5. I'd add more in here and reap the rewards of a failed short attack and a fat dividend. 

Still looking to finish out the MP. Later this week we may get the chance to do that.

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Wow, the Solar industry is on the ropes

The Solar industry is so beaten up, it looks like it's almost over. I hope it's the 'rope a dope' and not the real thing! That's why I gotta believe we gotta be buying them. I think we're going to see some M&A activity in that space, but who has the money to buy? Definitely not another solar name. Maybe a big company like GE or Dow Chemical. Either way, I think the downside risk is so small and when people figure out they're not all going out of business, some of these are going to be up 5 to 10 times. 

I'm not sure which is beaten down worse, solar or Chinese Internet stocks? This much gloom and doom must be a good thing for those of us who can wait.

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Sunday, October 2, 2011

Picking fruit from our trees UPDATED 2 Oct

2 Oct - We added MetroPCS (NYSE: PCS) to the MP at $8.70. I gotta believe this ATT/T Mobile potential deal is a positive for this company. If the deal goes through, Verizon, Sprint, or some unforeseen entity will be pressured to step up and buy them. If the deal doesn't go through, then great for PCS. In addition, wireless is just where everything is going, land line are dead. The wireless companies are the new mob, joining the cable companies. Getting online is critical and these two industries rule that. The stock is beaten up, but over the next couple of years they should emerge as the number 3 player in this space if they aren't acquired.

That's 8 spots taken. By the way, we know the portfolio has been beaten up lately and the fall has been dramatic in both the market and our portfolio, but none of these companies are going out of business and knowing we plan to hold into 2013 gives us comfort. Some of the sectors like solar and China Internet have been killed to the point where it's become ridiculous. This is when you buy.

10 Sep - I know we were reluctant to touch the insurers 30 days ago, because of European exposure concerns, but one of our old friends Hartford (NYSE: HIG) doesn't have much of that, so we're adding HIG to the list at $16.75 it's a bargain. We don't believe it or most of the other insurers fully recovered from the beating they took over the past few years. It's a solid name and has a 2.3% yield in here with book value over 40, we like it. While we looked at Genworth, there's still that uncertainty over the mortgage business and the potential restructuring down the line and no dividend to keep us warm at night.

We're adding another combo play, Renesola (NYSE: SOL) at $2.90 and Trina Solar (NYSE: TSL) at $10.50. These two stocks will hold one position. This sector has been beaten down to the point of absurdity. I think the real problem is there are too many solar companies and many need to go away. There's tremendous upside here and very little risk over the next couple of years. It's dangerous picking just one, as who knows who's going to survive, so we pick two of the bigger, better run companies. These companies are running out of cash and they have the scale and management to outlast and out do the competition. Also, both these names are heavily shorted which could provide some lift on good news.

That's 7 down and 3 to go.
22 Aug - So DANG appears to have been targeted by short sellers. Got hammered today and I didn't notice it was on the Reg SHO/Threshold list until today (been there for a while). For those of us who can wait it out, we should see a nice pop, eventually.

20 Aug - Adding a combo play Dangdang (NYSE: DANG) at $7.90 and Renren (NYSE: RENN) at $7. This position will hold one spot in the portfolio, so it's a split. This is our speculative play and gets ups good exposure to the Chinese consumer and both companies increased revenues by over 50%. Some of the negative news around these names doesn't bother me as I heard the same stuff about Baidu and Ctrip and Sina.

14 Aug - Adding Frontier Communications (NYSE: FTR) at $6.95 and that fat 10.8% yield.

So Cisco (NASDAQ: CSCO) had a good quarter so in to the bag it goes. At this price, why wait. We're adding it tomorrow, say we pick it up at $14.50 given where it'll probably trade. We're also adding Petrobras (NYSE: PBR) to the portfolio at $26.50. This is the oil company of the future and this is a dynamite price.

Remember, we're going to pick 10 names and spend equal amounts on each. So far we have NVTL, CSCO, PBR, FTR, DANG/RENN, HIG, SOL/TSL, PCS. We'll summarize them when the list is complete.

Read more...

Wednesday, September 21, 2011

Another MP short target

So the latest rumor is Frontier (FTR), MP member, has been targeted by shorts. The action of the past few days did get my attention. The volume was enormous and the price movement was ridiculous. This is one the shorts may regret going after with that hefty dividend. Their plan must be to send the stock down enough so the dividend is not sustainable, but that's a risky play. I'd buy more at $6 and a lot more if it fell significantly below that. 

The market is definitely in a bad mood that could last another 2 maybe 3 months, but this is the way things go - longs have their day and shorts eventually have theirs. It's times like these we dress up our portfolios and when times are great and it looks like they're will never be a down day, that's when we sell some.

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Tuesday, September 20, 2011

Hold on to your hats, it's stormy outside

We went through this mid last year, where the market was ruled by the unruly. This is why we say over and over again, don't try to trade this market, but invest and be prepared to stay with your positions for a year or longer. Seems everything China is taking the brunt of the beating. Still waiting to fill our last three Model Portfolio spots. 

I wonder if the SEC is ever going to take our markets back from the hoard of speculators that have transferred billions in wealth from every day people to themselves? How many times do we have to watch coordinated attacks by speculators on small/mid cap stocks with low floats, sometimes destroying companies, before someone does something? 

Anyway, glad we're still able to collect fat dividends.

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Saturday, September 17, 2011

Crazy week with crazy volatility

This market is up to its old tricks. Hedge funds are back with a vengeance and that can be seen in the volatility and high level of correlation between similar stocks. It creates opportunity, as times like these traders tend to throw the baby out with the bath water. 

Notable stories, Netflix (NASDAQ: NFLX), what a disaster. They actually thought they could raise prices 60% over night and not suffer defections. They must have been high on their own success. 

The story with RIMM is no surprise, as we've talked about their demise for some time now. All the people who thought they were getting a bargain at $30 should be ready to double down at $15. What a disaster. They had such a strong brand and squandered it. 

Been thinking about the last three names for the Model Portfolio and we have a few candidates, but can't decide yet, looking at wireless telecom, biotech, and China.

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Wednesday, September 14, 2011

Novatel being dogged by shadowy figures

Some bodies have it in, not just for DANG, but for NVTL. I'm starting to see the most obscure articles written by unknown bloggers, even more unknown than PaperGains, being published on Google and Yahoo dogging NVTL. I thought there was a raid taking place in NVTL stock and I'm completely convinced now. The stock hasn't moved much as a result of these perceived negative stories, so I'm thinking in a few months they give up. Invest, don't trade and you can wait this stuff out and make good money. 

How about the HIG headlines lately. The upgrades are a day late to the party.

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Saturday, September 10, 2011

Picking fruit from our trees UPDATED 10 Sep

10 Sep - I know we were reluctant to touch the insurers 30 days ago, because of European exposure concerns, but one of our old friends Hartford (NYSE: HIG) doesn't have much of that, so we're adding HIG to the list at $16.75 it's a bargain. We don't believe it or most of the other insurers fully recovered from the beating they took over the past few years. It's a solid name and has a 2.3% yield in here with book value over 40, we like it. While we looked at Genworth, there's still that uncertainty over the mortgage business and the potential restructuring down the line and no dividend to keep us warm at night. 

We're adding another combo play, Renesola (NYSE: SOL) at $2.90 and Trina Solar (NYSE: TSL) at $10.50. These two stocks will hold one position. This sector has been beaten down to the point of absurdity. I think the real problem is there are too many solar companies and many need to go away. There's tremendous upside here and very little risk over the next couple of years. It's dangerous picking just one, as who knows who's going to survive, so we pick two of the bigger, better run companies. These companies are running out of cash and they have the scale and management to outlast and out do the competition. Also, both these names are heavily shorted which could provide some lift on good news. 

That's 7 down and 3 to go. 

22 Aug - So DANG appears to have been targeted by short sellers. Got hammered today and I didn't notice it was on the Reg SHO/Threshold list until today (been there for a while). For those of us who can wait it out, we should see a nice pop, eventually.

20 Aug - Adding a combo play Dangdang (NYSE: DANG) at $7.90 and Renren (NYSE: RENN) at $7. This position will hold one spot in the portfolio, so it's a split. This is our speculative play and gets ups good exposure to the Chinese consumer and both companies increased revenues by over 50%. Some of the negative news around these names doesn't bother me as I heard the same stuff about Baidu and Ctrip and Sina.

14 Aug - Adding Frontier Communications (NYSE: FTR) at $6.95 and that fat 10.8% yield.

So Cisco (NASDAQ: CSCO) had a good quarter so in to the bag it goes. At this price, why wait. We're adding it tomorrow, say we pick it up at $14.50 given where it'll probably trade. We're also adding Petrobras (NYSE: PBR) to the portfolio at $26.50. This is the oil company of the future and this is a dynamite price.

Remember, we're going to pick 10 names and spend equal amounts on each. So far we have NVTL, CSCO, PBR, FTR, DANG/RENN, HIG, SOL/TSL. We'll summarize them when the list is complete.

Read more...

Monday, August 22, 2011

Picking fruit from our trees UPDATED 22 Aug

22 Aug - So DANG appears to have been targeted by short sellers. Got hammered today and I didn't notice it was on the Reg SHO/Threshold list until today (been there for a while). For those of us who can wait it out, we should see a nice pop, eventually.

20 Aug - Adding a combo play Dangdang (NYSE: DANG) at $7.90 and Renren (NYSE: RENN) at $7. This position will hold one spot in the portfolio, so it's a split. This is our speculative play and gets ups good exposure to the Chinese consumer and both companies increased revenues by over 50%. Some of the negative news around these names doesn't bother me as I heard the same stuff about Baidu and Ctrip and Sina.

14 Aug - Adding Frontier Communications (NYSE: FTR) at $6.95 and that fat 10.8% yield.

So Cisco (NASDAQ: CSCO) had a good quarter so in to the bag it goes. At this price, why wait. We're adding it tomorrow, say we pick it up at $14.50 given where it'll probably trade. We're also adding Petrobras (NYSE: PBR) to the portfolio at $26.50. This is the oil company of the future and this is a dynamite price.

Remember, we're going to pick 10 names and spend equal amounts on each. So far we have NVTL, CSCO, PBR, FTR, and DANG/RENN. We'll summarize them when the list is complete.

Read more...

Saturday, August 20, 2011

Interesting opportunity

I was snooping around and see that you can actually buy the 2013 5 strike call on FTR for about 2 bucks. The stock is trading at about 7 right now, so for those of you with a stomach for huge moves in your portfolio, like 20-30% swings a day, looks like easy money.

Let me break it down this way. The stock goes up 50 cents, the call goes up at least 50 cents which is a 25% move. With that fat divi, no one is going to stay short long, as you have to pay the dividend when you're short. That removes one of the biggest risks to buying calls, that some hedge fund decides to go short and stay short.

If the stock gets under 6.50, it's an easy play, as my money says the stock goes back to 9 long before 2013 which would be at least a double in the 2013 call struck at 5. Remember, options aren't for most people, but for those of us who trade options, I like it.

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Wednesday, August 10, 2011

Picking fruit from our trees UPDATED 20 Aug

20 Aug - Adding a combo play Dangdang (NYSE: DANG) at $7.90 and Renren (NYSE: RENN) at $7. This position will hold one spot in the portfolio, so it's a split. This is our speculative play and gets ups good exposure to the Chinese consumer and both companies increased revenues by over 50%. Some of the negative news around these names doesn't bother me as I heard the same stuff about Baidu and Ctrip and Sina.

14 Aug - Adding Frontier Communications (NYSE: FTR) at $6.95 and that fat 10.8% yield.

So Cisco (NASDAQ: CSCO) had a good quarter so in to the bag it goes. At this price, why wait. We're adding it tomorrow, say we pick it up at $14.50 given where it'll probably trade. We're also adding Petrobras (NYSE: PBR) to the portfolio at $26.50. This is the oil company of the future and this is a dynamite price.

Remember, we're going to pick 10 names and spend equal amounts on each. So far we have NVTL, CSCO, PBR, FTR, and DANG/RENN. We'll summarize them when the list is complete.

Read more...

Monday, August 8, 2011

What a day

It's nice being a spectator on days like this. I could hardly take my eyes of the tv and Internet. Too bad I had to work! The tricky part about making real money in the stock market, is how do you keep your money when everyone else is loosing theirs, so you can buy cheap at times like this.

Well we've been waiting. We've nibbled around the edges, but took no big bites.

So in getting prepped for our new portfolio, we had to add one name now because it's so cheap, Novatel (NASDAQ: NVTL). We've talked about plenty and it's going in at about $3.50. We're teeing up Cisco (NASDAQ: CSCO), but will wait until Wednesday when they report. There's another energy name that is more than likely to go in, but we'll wait a few days on that one.

When we've got all the names we'll compile them and lay it out like last time. This go around things are different, as things are at different levels. Unlike March 2009 when everything was 75% off on the same week.

By the way, market routs like this usually take a few weeks to sort out, so it may take 2 if not 3 weeks to get all 10 names at our price.

Remember, this model portfolio is different from our core holdings. Our core holdings, BMY, INTC, GE, VZ/FTR, PBR are stocks we plan to hold until death do us in. I know some of those were in the last model portfolio, but they were so cheap!

Stay tuned. You may be surprised by some of our picks. I've created a new label/category to the left that lets you find posts related to the portfolio called modelP.

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Friday, August 5, 2011

The horror show that was Novatel

Yes, we talked about this stock and we bought some and guess what readers, we bought some more today. Here's the skinny, close to record quarterly revenues which are up over 50% year over year, book value of over $5 per share, mobile broadband and mobile wifi/mifi taking off, and their machine to machine business is just starting to kick in.

At the end of the day, this drop is trader driven and with a market cap of $100 million, this looks ripe for an acquisition. We don't bet on acquisitions, but instead on value and this is easily a $10 stock. Remember, we invest, we don't trade, although we might use that language from time to time, which means we can wait this out.

By March, we expect to be much, much higher.

Don't buy on margin and don't buy expecting to ring up the register in a week.

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These are the days, we've been waiting on

Finally, this market is creating some buying opportunities. I haven't forgotten about publishing the new portfolio, but given recent events, the prudent thing to do is sit back and watch the show for just a while before picking up those bargains.

Can't wait until Monday. The mayhem level should be off the chart after the S&P downgrade.

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Thursday, July 14, 2011

What to do, what to do

Other than a nibble here and a nibble there, we've still got high levels of cash. In fact we're pretty surprised no one seems to care a whole lot about the pending disasters, for example the US credit rating and Europe. The S&P is just about where it was at the end of the 1st quarter.

This is another one of those periods where things could go either way in a hurry, which means the prudent thing to do is watch from the bleachers. I confess to buying some of the Chinese Internet plays, Renren (NASDAQ: RENN) and Dangdang (NASDAQ: DANG). DANG is more reasonably priced, but both have nice upside after they were beaten down. RENN under $9 is nice and DANG under $12 is nice. Only bought a little, not a lot and my reasons were purely speculative. I also thing they do deals with non US companies in the future, but again, speculative.

Well, yes, things are a little boring here, but we still hold our core stocks, which I won't go into, as we've talked about them enough.

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Sunday, June 19, 2011

What a nice bath investors have taken lately

The recent market sell off has been nice, but I'd like to see more and if we don't get it this coming week with the pending Greece disaster, I think we'll get it this earnings season in July, as I don't think the forecasts for the rest of the year are going to expectations.

A couple of stories we like, Novatel (NASDAQ: NVTL) has made a nice move since we started buying under 5 and I don't care what the critics say, I like Cisco (NASDAQ: http://finance.yahoo.com/q?s=csco&ql=1) down under 15. You've got to be willing to buy when others won't to make the real money. CSCO will right its ship over the next couple of years and in the mean time, there's that 1.6% yield. It's not huge, but nice to collect it while waiting for 20+.

Looking to put together the Model Portfolio when this market gives up a bit more.

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Wednesday, June 1, 2011

What a day

Remember what we've said about huge sell offs that happen toward the beginning of the month -look out below! I admit, this market has been tricky and today may end up being just another blip, but today didn't look good. This might be the beginning of a long, hot, nasty summer in the market

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Thursday, May 26, 2011

Taking a close look at a small company

A couple of years ago we added Sierra Wireless (NASDAQ:SWIR)to the 2011 Model Portfolio and we were very happy with the return, buying at $3.8 and it trades around $11 now. It's ugly sister, Novatel (NASDAQ:NVTL) always seem to be not quite as good, but the two stocks over the years crissXcross.

When one trades at twice or near twice the other, it's not long before they come together. With that typed, We're sniffing around NVTL and while we think SWIR is the better company (they're in the same business-mobile wireless), we expect NVTL to do well over the next 12 months. We've starting adding some, not a lot, but a little and may add a little more if we get a good sell off in this market.

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Sunday, May 15, 2011

Looking at Cisco

Although I'm not eager to put on any new positions, I added a little Cisco (CSCO) to the pile. Couldn't resist. I just think that long term this stock looks cheap. It also pays a little dividend which fits in with the long term strategy.

Other than that, still in a holding pattern. Prices have come down, but we're waiting on a nice shake out, that causes people to question the market.

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Sunday, May 1, 2011

Still waiting

Just holding out, waiting on this market to give in and sell off. In the mean time we've taken up new positions against silver and long bets on volatility. When the market finally rolls over we'll have plenty of cash to put to work.

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Sunday, April 24, 2011

Still in a holding pattern

Sometimes the best strategy is to sit tight and wait for 'that' moment. That moment when panic selling sets in. We just find it hard to do much buying unless everyone else is selling. In the meantime, there are some relatively good places to park short term cash.

One of my favorite mutual funds for holding cash, TGMNX, pays about 7%. Also, we've been looking real hard at PFF which is an ETF investing in preferred shares and yields about 7%. Both should allow us to move from cash to riskier assets with ease.

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Saturday, April 16, 2011

Getting a new plan together

As I stated earlier, we'd rather not be buying anything at the moment, instead we prefer a 'holding pattern' strategy. We didn't dump our core holdings, but we dumped everything else and currently creating a list of stocks we'd like to buy after a nice ugly pull back.

We're in a much different place than we were 2 years ago. It seemed easy picking winners a couple of years ago because everything was so cheap. Today's market separates the 'pros' from the 'schmoes'.

Buying the metal, iron ore, coal, and aluminum producers expecting a double in a year probably doesn't work going forward. We need a strategy with a bit more finesse. Early indications are more than 50% of our portfolio will be positioned outside of the US. For example, I'm thinking our core holdings that pay us fat divys will be US based, while our growth plays will be located in the BRICS and elsewhere.

We're working on a new 2013 Model Portfolio, but won't have it final until we get into a good sell off.

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Saturday, April 9, 2011

Hello friends

Well, what a surprise, I'm back here pouring my thoughts on the market back on the web. I think I needed the time off. Much has happened in the past 6 months. Some of the stock I loved, I now hate and some I didn't like, Ihttp://www.blogger.com/img/blank.gif now sort of like.

The 2011 Model Portfolio performed nicely over the past 2 years and some of our biotechs were big winners, while some were just wieners.

Those of you that held on to Cliffs (NYSE: CLF) and Freeport (NYSE: FCX) should be celebrating. The foundations of our long term retirement portfolio have performed a little better than I even thought, like Verizon (NYSE: VZ) and Bristol-Meyers (NYSE: BMY). Huge yields and both are up nearly 30% from where we recommended them. We still hold VZ and BMY of course.

This market still seems to be primarily driven by something other than fundamentals and there are still some great long term deals out there which I find surprising, like Intel (NASDAQ: INTC) and Cisco (NASDAQ: CSCO). INTC has a yield of 3.5% and CSCO is yielding 1.5% and both could trade in the uphttp://www.blogger.com/img/blank.gifper 20's within the next year. INTC is still in the portfolio. INTC under 20, hmmm.

Vivus (NASDAQ: VVUS) and Arena (NASDAQ: ARNA) didn't fare so well, but the last chapter hasn't been written in that comic book yet. Remember, these stocks are concentrated equities, so a little goes a long way. You can hold a little and wait this thing out without betting the farm.

For the record, we also still hold GE and Petrobras (NYSE: PBR). PBR is actually paying almost 4% right now, ignore what you see on yahoo as far as the yield. We sold a lot of other things. Although, we still hold a little VVUS, ARNA, and DNDN (very little for the long haul). A little spice for the portfolio. There's very little else we like right now, as this market is in 'no man's land'. There's no way we continue to rally. At some point in the very near future, the bears will have their days, which will likely be weeks and 15%. The patient investors wins. Remember, sell high, buy low and never chase.

Will report back later.

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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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