I bought some REGN shares on a breakout Friday, and I am glad I did. I didn't buy as many shares as I lost on before, but I'm not complaining. In hindsight, that would have been a good stock to average down on.

USG is looking good too. SGDE is pausing, but will hopefully move up from here.

WINS is one trade I wish I had stayed in. It has jumped dramatically from where I let it go.

"Options For The Stock Investor" written by James B. Bittman...McGraw Hill


http://books.mcgraw-hill.com/

Once you get to the website type in the name of the book.

Good book on stock options.

Ldvee,

The cost is $32.95 which is cheaper than my dinner and also this guy knows more than I do.

Kendricks thanks, Ben I'll buy the book today. This stuff interests me although as you know my investment objectives are pretty simple - double what I have now in the next 10 years with minimum risk. Preferably with no further contributions because that cuts into my fun money and I like to think that at 53 I can stop sacrificing fun to save. I've been doing that for 30 years.

I think a big part of my interest is just because I don't understand.

Writing calls options is a very conservative strategy and just gives you some down side protection. Many don't like the strategy because in many cases you are forced to sell your stock for under the current market value. Of course that is the reason someone is gambling by paying you money up front.

Buying options is very risky, but you have incredible leverage as you may controll several hundred shares of a say $50 stock for just 3-5% of the cost of buying the stock. It is not unusual for an option buyer to double or triple their money in just a few months and also not unusual for an option buyer to lose all their money on an option purchase.

Wow,

Nice day so far.

I just don't get it? I guess our economy is going to do better than I think over the next year.

Go GE, XOM, AIG, BAX, NYB, FNF, QCOM, etc.

I have a buy order for MRVC over its most recent highs. If it breaks out, it looks to me like it is poised for an upward explosion.

With a solid covered call strategy, doubling your current money within the next ten years should be easy.

I'll have to go see the hired hand at Smith Barney and discuss the plans, see if he has a new crystal ball. Actually the rule of 72 says 8% doubles in 9 years, so I need to average 8% and since we're into a record bear market that seems to be coming to an end things look promising in the light of my goals. If implementing covered calls as part of the deal increases the chances of success, I'll do it. I wonder if I should throw some junk bonds into the mix? Is that a dumb question or what?

What time does class start today? I have a question about short positions in a stock.

Days to cover is the short interest divided by the average daily volume, OK, got it. I'm wondering what the significance of this metric is.

http://www.nasdaq.com/asp/quotes_full.asp?mode=&kind=shortint&symbol=ERES&symbol=SURE&symbol=&symbol=&symbol=&symbol=&symbol=&symbol=&symbol=&symbol=&FormType=&mkttype=&pathname=&page=short&selected=SURE

My MRVC stop was triggered, and I am the proud owner of 2000 shares at 1.98 each. Let's see some follow through on this breakout...

Kendricks,

Why MRVC?

Actually I've been quite happy with Meridian Resource (TMR) that I bought at $1.06 on May 2nd and closed yesterday at $2.01. A few more like that I can afford a trip to Rio!

Poochi,

Nice pick, what was the event in Dec that caused a 50% drop that it has recovered from?

OMG is another one that's doubled in the same time frame. I think Ben pointed it out after its drop.

That is nice, Poochi. What are you looking at now?

I like MRVC's chart - it is starting to break up out of a long, low sideways channel on increased volume.

It is also selling for less than 2 times its book value, has no debt, plenty of cash, and it losing money at a far slower rate than it had in the recent past. If its earnings trend continues, it could actually become a profitable company.

I have a theory that totally beaten down stocks may take off for great gains when the grimness of their situation improves from total despair to the point of potential turnaround.

Since it is moving above all its recent highs on higher volume, it looks to me like it may be awakening speculative interest. If this is the case, it is a train that could be well worth jumping on, for the risk.

It could obviously fizzle, too. I think it is a good risk/reward play, though. Kind of like throwing a couple of big bets in at the end, just because you have a lot of potential draws and the pot is huge.

I also invested in the following over the past 4-6 weeks:

OMI CORP (OMI) up 21%
TOUCH AMERICA (TCAHE) up 60%
XCELERA (XLA) up 61%

I'm positioning on:

EDT LEARNING (EDT)
DIGITAL POWER CORP (DPW)
BENTLEY PHARMACEUTICALS INC (BNT)

Ldvee, since the company is in the oil and natural gas business I'm sure you can figure out why the drop in December!

FYI my sources are telling me there is a huge natural gas shortage. We're short now and it's summer! Further the media talks about middle east oil, but there are bigger problems brewing in South America.

I have been investing in Evergreen Resources EVG for a couple of years. This company is very efficient in drilling for natural gas in southern Colorado. Very profitable now and if gas prices go up, they should do even better.You might consider EVG as a good natural gas company, but of course you could lose all your money and investing is a very risky business.

Also might consider Devon Oil DVN if you like natural gas.

Poochi and Ben, thanks for posting your current ideas. We have had people in the past come in and talk about their past successes, yet never discuss what they are getting into before their phenomenal gains are made.

What kind of selection criteria do you use, Poochi?

Kendricks, it's research and networking along with a bias towards companies that are above book value, little or no debt, and plenty of cash since I am worried about deflation.

Another strategy I've used for years is to invest in companies that are in the "Best Places to Work" list since I strongly believe motivated employees in such an environment will produce results!

Remember investing like medicine is part science and part art!

I may have pointed out OMG, but I never bought it. Damnit!!

I see where TMR dropped in late October and early November last year and I don't see why it should have dropped. The price of oil and gas was going up or at least steady with oil around $27 per barrel in November.

You know, talking about stocks that have doubled in 6 months and then thinking about my quandry of how to double in 10 years makes want to go to TJ and do something that's a SURE thing.

But work tomorrow AM so I'll stay here.....maybe.

Thursday nights are just about the best.

Hmmm, 45 minutes from my door to AB.

Poochi keep posting to this thread. Benosaurus and Kendrips ... yo no se. I offer to buy them dinner to gain benefit from their knowledge...nada.

So what is the significance of "days to cover" anyway?

Ldvee, I live in the Upland area. Driving to San Diego for a free dinner isn't a very exciting proposition. I'd be happy to let you buy me dinner up here, though!

I enjoy more participation in this area. Welcome and keep posting Poochi.

Why not buy my dinner Friday night, June 6? I am talking the teenager "HoneyPie" for a nice dinner down in the zona rio area and need some extra cash.

We then plan to hit La Tropa where SugarPie is expecting me.

I was addressing Ldvee regarding the dinner.

Ya right, you need extra cash, SURE. The offer is not because I'm nice guy, I want to pick your petrified brain, amigo.

Appointment with the SB hired hand next week. I'll pick his brain. I prefer to learn by talking with experts, like you and him, and others on this board. Reading does not allow me to steer the explanation in the direction of my particular needs. A dialogue is much better.

I just bought 500 shares of PLT at $21.40 a share.

Company had a good outlook before news today that CA Assembly bill will require all drivers to use handsfree telephones, CA is second state to pass this law (still has to be approved by the state senate). I think many states may follow Ca down this path.

Not suggesting anyone should buy this stock as it has risk and you could lose all are part of your money.

I forgot to tell Kendricks that the 100 point rule still applies to him, sooooooo it looks like Ben is going to win the Dow game for this week.

8925 for Ben next week!

Benwhowilldoanythingtowin

As the great Jesse Ventura once said:

Win if you can, lose if you must, but always cheat.

WHOA off to Rio I go! TMR's well at its Biloxi Marshland Project area hit paydirt today!!! The stock is up $0.69 (33.33%) for the day closing at $2.76 from my original purchase at the first of the month of $1.06.

Congratulation Poochi!!!!

A Home Run.

I have spent mant days and nights in south Louisana on locations in the middle of the swamps where they had to drag the drilling rigs in on steel barges. Lots of high pressure stuff with blow outs and fires going on when I was in high school living in New Oreleans.

benwhowanders

Damn Kendricks!!!

Kendricks right on the money and is the winner with a pick of 8850. Lucky Bastard.

I pick 8925 (see above) for next week

Thanks Ben! Just for full disclosure I sold all my TMR today at $2.67 since I doubt there will be any other news for the next three months, besides even if it went to $3.00+ I rather be in this position rather than it falling back to $2.00 or less. So I am looking for my next opportunity.

For some reason I still like OMM since they have the youngest fleet of tankers. If there is any disruption in supply (Middle East, South America, etc) the demand for their fleet will increase.

Wow - not only have I won two weeks in a row, I have now hit the DOW exactly on the head an unprecedented THREE TIMES!!! Amazing.

8994 for next week.

Poochi,

You never lose money taking a profit. It is sometimes harder to sell than buy.

Kendricks,

You are getting on my nerves!!!

OMM does look solid. Selling for below book value, good recent earnings momentum, and trending up decisively off of its lows. I like it.

Ouch!!!

I bought 500 shares of Michaels Stores at $32.63 on May 21 and sold the June 32 1/2 Call for a net profit of $770 if it gets called away on June 20. The stock is now selling at $38.39 and of course I would be up $2880 if I had not sold the call.

The investor/gambler who paid me $984 to buy the option could sell the option for $2900 as of today.

Not complaining as I made a nice profit, but here is a good example of sometimes when a stock really takes off in a good market, you regret selling the option.

Dow 9045

Ben I pick 8925 (see above) for next week

Kendricks 8994 for next week.

T_Bone Dow 9045(late as usually)

Here's an interesting idea: Buying stocks near their 52 week lows that are debt free, are profitable companies, are selling for below book value, and have increased volume since putting in their lows. A prime example would be PQUE.

If it keeps moving down, sell. If it starts moving up, ride it. I would view a trade like this as one that has limited downside, and huge upside potential.

I doubt Ben would view this as "investing", but I think it just might have some potential....

The trouble with these types of oil companies is that they normally drill in developmental fields where their chances of finding oil and gas are very good, but because these old oil fields are depleted the production is generally marginal. Therefore the profitability of the company is based on oil having to stay in the high $20 range and gas around $4.50-$5 (just a guess) to make a profit. Incidentally oil is currently a little above $30 a barrel, which I think, will probably come back down by the middle of the summer.

Their financials are interesting in that the cash flow and net income look good, but they do seem to have allot of payables with very little current cash to meet their obligations. I just always wonder why a good stock is selling for around a dollar?

Kendricks,

PQUE is projected to earn .01 per share this year if I read the analyst numbers correctly. It is projected (anybodies guess) that it will earn .03 in 2004. I think you could say that is a tremendous rate of earning growth, but I feel this company need to earn at least .10 per share to make any sense.

I do agree that perhaps just on momentum it might be a decent gamble, but very risky.

Damn the stock is up almost 5% today as I prognosticate.


(Message edited by ben on June 03, 2003)

My thinking on this type of trade is that, just as irrational exhuberation drives stocks too high on the up side, extreme pessimism and fear can drive stocks too far down.

If a profitable company with no debt is beat down to below book value, appears to put in its lows, and then begins to inch higher on increased volume, it would seem to me to be a logical candidate for a bounce or upward retracement.

Of course, it could continue to move lower. If it puts in new lows, I would have to sell. But, it seems that the odds would favor it moving higher.

If this is the case, it would liken it to having a nut flush in hold 'em, with one last card to come and an unpaired board. Sure, it is possible that the board could pair, and make some son of a bitch his full house. But until that happens, I will be jamming money into the pot - since the odds favor my winning. And, in this situation, the upside of winning a big pot is greater than the downside of me losing a couple of additional bets.

This is just an unproven idea I came up with last night. I did buy a couple thousand shares of PQUE at 1.36 this morning, though, just to make it interesting.

Just got back from an appointment with the hired hand (1.5% per year). Half of my portfolio has been in cash for the past three years and he's going to start buying again. We agreed upon equities that pay at least a 2% dividend and have a top SSB rating. He then further filters the list by eliminating those that are not on the other brokerages top rated list. I suppose the ratings are based upon the myriad of ratios these guys use. I also gave him control of the account I used for the SURE disaster. Looking for 11% per year over the next 10 years.

I'm out of the stock picking business. Too complicated for a guy who works full time in an unrelated area and spends his free time studying pussyology.

Well, good luck, Ldvee. If you are going to turn your money over to someone to make stock picks for you based upon brokerage ratings, luck will be essential.

I hear you, but my other options are I pick them, or I buy mutual funds or I hire Benosaurus. Year to date I'm up 16% just looking at the equity portion so he's exceeding the stated objective. He's picking them and I'm watching closely.

BTW, the ratings are not the buy, sell, hold crap that they spew out to the public. They're metrics based upon a slew of numbers in proprietary databases. I'll find out more about it.

Plus, having these accounts provides a very cheap line of credit (5% now) and free access to financial planning advice when I need it, so there's other benefits to going this route.

Insomnia tonight, I should not of eaten that whole pizza earlier.

Ldveewhoalwayssuccumbstotemptation

I obviously have a bias about using professional management in that I doubt the 1.5% management fee is the real issue in making money.

If I have a client buy 300 shares of Home Depot at say $25 and it is now at $32 does he really care about the .35 a share I charged him. The charges are just not the issue. If I recommend HD and it goes from $25 to say $15, again the .35 a share commission is not very important.

If the guy has your poertfolio up 16% this year and more important had half your portfolio in cash for the past three years, the 1.5% was a bargain. The only thing I would wonder is why he didn't have the cash in either government or muni bonds where your cash would have earned around 8-11% for the past three years.

To late now for bonds in my opinion and it is so easy for me to second guess the guy.

It seems overall he has done a great job.

Also most investors have no clue about how to select stocks. There are exceptions like Kendricks who have spent the time to read and study about the stock market.

"wonder is why he didn't have the cash in either government or muni bonds"

That's a good question. I'll ask him. I'm guessing he was thinking that he'd be buying stocks much sooner so was keeping the cash at the ready. But I dunno.