SUREE hit $1.00 and now is up about 20%. I guess it's the shorts closing out their positions. I wonder what happens when the shorts are finished and how long it will take. This is interesting stuff. Watch and learn.

Just put in a limit order to buy 2000 shares of SGDE. The company has no debt, although it does have a fairly large accounts payable.

It is selling at 14 x earning and has a growth rate of 20% for this year. Also the the fourth quarter is always by far their best quarter.

I have been switching to retail stocks over the past few months as the economy continues to grow.

U.S. retail sales report comes out tomorrow and is expected to be positive.

All of this could be fuzzy thinking on my part and of course you could lose all your money investing in this stock.

I wish I had bought it at $9 a few months ago when Kendricks suggested it.

Ldvee, we have two lots, one was a resale and commercial lot, but I don't invision much commerce there. It both are 10 x 20 meters. Unfortuately they are not side by side.

Ben and Kendricks, In late Oct I will be closing on my personal residence of a year ago, I expect to clear about 225k. I am trying to ease out of real estate and I'm thinking about stocks You think I should put in into SDG&E, SUREE or TJPieCo? I have been reading your posts, but I'm confused.

Nayaritwhowantstocoverhischicabills

Nayarit,

Definitely not SUREE and definitely not two or three stocks. I'm diversified pretty much equally over about 45 stocks that a pro picks for me. A novice should probably hire a pro money manager or look into mutual funds.

I know, I ment to add (lol) to my post, and try to snag some advice. I already pretty much have an equal amount in mutual funds. So I my choices are to payoff a mortgage or put more money in the stock market. In two more years I'll have another personal residence capital gain and net about $300k

ALT is on fire! That was truly a great pick, if I must say so myself.

ARQL looks like a great value, and I like its recent price action. I just picked some up at 4.45.

I bought 1,000 shares of CYD this morning.

It has really moved up but I it still as some up side.

I took my profit on MWY, and bought some GADZ. GADZ is selling at great value, and looks due for a bounce.

My ALT shares (3000 at an average cost of 1.45) are up nearly 100% now.

How high will they go? Time will tell.... I'm not getting off this rocket quite yet, though.

Kendricks

Another nice pick on ALT.

Congratulations.

Thanks Ben! FONR looks like it is bouncing back, too. I still hope to see this over $2 soon.

Yo tanbien on the FNOR.

I just sold half my ALT shares for 2.70. Now, I have 1500 shares left, that are essentiall free (I previously bought 3000 shares at an average cost of 1.4, for a total of $4200, and then sold half those for $4050).

So, I now own 1500 shares of ALT that are worth $4050, for a net cost of $150. For me to break even on the trade, the shares would have to fall from 2.7 to ten cents.

Big Fuckin Deal!!!

Now you have to pay taxes.

Maybe I could lend you some of my losses.

Benwithenvy

Oops, my math was off a little. I actually was in ALT at an average cost of 1.45, not 1.4. Still not a bad trade!

GADZ is looking nice, too. I got in yesterday at an average cost of 3.8, and it was at 4.2 when I last checked.

It seems to me you have a pact with the devil or maybe you are just lucky.

Nobody is smart enough to pick as many winners as you have this year.

OK, OK, you are smart.

Congratulation again.

Thanks Ben. I do have a pact with the devil, by the way. You want in?

YES!

gadzooks, you are a good picker!!!

were there any DOW picks this week? Maybe we should just let last week's roll over.

I owned and sold yesterday about 300 shares of TTN at $21 or so. Bought at $6 about 5 years ago. Nice little profit. I watched it go from 6 to 60, back to 7 and got out at 21. Fucking crazy market in the past 5 years!

How about that liberal rant a few days ago? Turned into an interesting thread.

Vote Camejo, vote Clark!!

Clark is a rather interesting guy.

Very very intelligent and of course you have to be a fairly good politician to be come a four star general.

Physically he is handsome and a good speaker. Very knowledgeable about foreign affairs.

Yes on I liked your rant and yes on using last weeks picks.

Who won last week?

Kendricks,

Check out CVU. What do you think?

I picked up some PRTN and ARTX this morning, and will take a look at CVU.

I just took a look at CVU, and it looks pretty good. A profitable company selling for good value, with no debt, that has been moving up but just pulled back a little. If it happened to pull back toward 8 more, I would like it even more, but it still looks pretty good to me as it is.

I didn't check if it is optionable - this could be another good covered call candidate, too, if the percentage is there.

I bought a 1000 shares of CYD on Monday at $18.65.

Very profitable company and they even pay a dividend.

The Chinese are keeping their currency cheap to the U.S. dollar and it makes some of their companies incredibly profitable.

I just bought some ASIA at 7.6, and wrote the 7.5 Oct calls against it for .7. About an 8% profit in 29 days, if assigned.

I also bought some ULCM at 10.4, and sold the Oct 10's against it for .9. Not as big a percentage as ASIA, but still not bad.

I used to be against margin, but think I have found a good use for it. Since the ISSX calls I sold will expire tomorrow, and the ISSX shares I have will be assigned, I previously had to wait until the Monday AFTER expiration day to write more covered calls on new stocks.

Now that I transferred my account to a margin account, I can write covered calls the day before expiration, without really being heavily margined - since most of the funds I used just now on margin will be back in my account again in one day.

Kendricks,

I have watched a monster created over the past year!

Margin account!!!

When are you going to start selling naked calls?

Ben,

margin accounts, sky diving, rock climbing, white water rapids, $10 slots, shooting heroin, bareback with street girls, etc.

Many people do these things, some successfully. Me? I'm risk adverse.

Naked calls??

last week's, now this week's picks

Ldvee 9600

T_BONE 9486

Ben 9350

Kendricks 9277

gadzooks!!!

T_Bone won last week!!!

Gadzooks is kicking ass! I'm up about 28% so far on that one.

ALT is pulling back, I'm glad I sold half. Maybe I should have sold it all. I think I'll hold on to the remaining shares for now.

Ben, my use of margin is pretty conservative here - I am just using it to avoid having to wait until the Monday *after* expiration to enter new covered call trades.

I've noticed that a lot of good covered call trades a month out disappear after expiration day on the preceeding month. For example, what may be a good trade for Oct covered calls may not be so good the day after the Sep options expire. Have you noticed this?

My you are an observant person regarding call premiums.

I will sometime sell calls on the expiration Friday even though my other calls have not expired until the end of the day.

It can be a little risky as you are not long on shares to cover your position until the other calls expire.

You are figuring out this game a lot faster than most.

Article about SGDE in Forbes;

http://www.forbes.com/2003/09/18/cz_rm_0918soapbox.html?partner=yahoo&referrer=

Of course you discovered this little gem when it was selling for $9.

Thanks Ben. This really is a lot of fun, and has become a huge part of my life.

I took my profits on my remaining shares of ALT, for about an 80% profit.

One I am kicking myself about is ACTG. That fucking thing has tripled since I sold for a 30% profit!!!!

I have learned a lot from you in this forum, too. Thank you for all of your insight and advice.

Five option positions expiring tomorrow.

I did great on three option positions, but really screwed up on NYB and it is going to cost me $2400 net to buy back the call or I can take a LTCG of $24,000 and buy something else. I have agreed to sell 2000 shares at $30. This company has done well, but I am thinking bank profits will slow down next year.

What would you do? Anybody.

I would let them be assigned, and move the profits into something else. My strategy may be different from yorus, though. I write covered calls in the hopes that the stock will be assigned, and do not like to spend money buying calls back.

Hey guys, remember when I was thinking about AMR back in March?

Kendricks, here's your response:

"By its most recent quarterly balance sheeet, American Airlines has 30.2 million in tangible assets, and 28.99 million in liabilities. With over 155 million shares outstanding, this gives each share a tangible book value of about 78 hundredths of a cent.

At $2.19 per share, each share is selling at over 280 times its tangible book value. Since it also LOST $3.5 billion in 2002 (over $22.50 per share), AMR seems to be dramatically overvalued at current levels."

and Ben,

"I know Ldvee didn't buy any AMR last year as I advised him(at no cost) to stay away from that company and the only airline stock I liked was Southwest Airlines."


Well................

March to now 1.25 - 13.45

http://finance.yahoo.com/q/bc?s=AMR&t=1y&l=on&z=m&q=l&c=





however Southwest has done well also

http://finance.yahoo.com/q/bc?s=LUV&t=1y&l=on&z=m&q=l&c=


Just goes to show that the market is mysterious for the pros and prodigies.

If you take March as the starting point many stocks have stellar moves up. As I recall you ask me about AMR when it was around $8-$9 and went all the was down to $1.25 before its recents rise.

(Message edited by ben on September 19, 2003)

That doesn't prove me wrong at all, Ldvee. Now, AMR is even MORE dramatically overvalued than when I made my original post! 8-D

There are a lot of people out there (momentum players) who buy a stock just because it is going up. Even though this strategy works sometimes, I'll stick with buying stocks that I think are a good value that I think are going to go up, just because the downside is so much safer if things go bad. This doesn't mean that stocks I think are overvalued will NOT go up - that happens all the time. I just don't like what happens when overvalued stocks crash (while I am holding them).

I took profits on VNWI this morning. Not a bad trade - in at 1.27 on 8-22, out at 1.43 on 9-19, for a 12.5% profit in less than a month (151% annualized). I'll probably buy it again if I can catch it below 1.30.

You're right, I wasn't slamming you, just pointing out how hard it is to guess. I didn't buy because I thought there was real risk of AMR going BK, and so did my hired hand when I discussed it with him as I now do on all purchases.

March was when he moved my 50% cash position into a broad range of equities. That's why I pay the guy.

I'm going to be meeting with him after the end of the quarter to discuss my spread over the various sectors and see what he says about upping the percentage in information technology and leisure sectors. My two favorite endeavors.

"Just goes to show that the market is mysterious for the pros and prodigies."

You are absolutely correct.

I still don't understand the stock market after investing in it since 1966.

jeez guys, please don't be so defensive.

The trick here is to make money and an AMR buy in March would have done the trick.

If you take a simple historical perspective on AMR it appears that the business they're in and the corporate knowledge on how to run the business indicates that there's considerable upside over the long term (several years).

http://finance.yahoo.com/q/bc?s=AMR&t=my&l=on&z=m&q=l&c=

Do you play poker, Ldvee? There are many times where the correct decision is to fold, even though later on the miracle card comes which would have won the pot for you.

Still, because of the odds and the situation, the correct decision was to fold - because if you make the incorrect play all the time, the odds will invariably catch up.

I view that AMR trade the same way. I don't kick myself for missing out on that trade, I congratulate myself for having the discipline to pass up a trade that was not mathematically sound (due to the crappy balance sheet and very real bankruptcy risk) - for in the long run, this is necessary to avoid ruin.

No I don't play poker, I'd like to but neither of my two friends do. 8^) I understand what you're saying though.

I might have the aptitude to trade stocks but I prefer to spend my non-working hours having fun.

One simple method that doesn't take much time I've been considerng however is to risk small amounts on companies that have taken precipitous drops and have recently leveled off or started to rise again. The Internet makes it easy to find these and the method does meet one half of the buy low sell high dictum. OMG and AMR come to mind.

BTW,

SURE also would be a candidate............

no I take that back, SUREE's drop isn't precipitous

fergit it

Ldvee, I recently did this with ALT, and made about an 80% gain (or something like that). MWY could also fit this category, too.

But the danger of this strategy lies with stocks link MPH and PSMT. Bottomfeeding is not all sunshine and roses, which is why I don't recommend buying a stock simply because it fell and looks like it is rising from a base. There have to be other compelling reasons in addition to this, in my opinion.

Kendricks you make excellent points. Your poker analogy was both simple and illustrative. The question I'd be asking about the bottom feeding technique is why the massive sell off? If the answer seemed illogical, or logical but the underlying problem appears to be easily fixed, I'd be tempted. I guess that's where the judgement comes in with this technique.