Thursday, June 26, 2008
Amen for AMED!
I'm seeing blood red in my portfolio today, so I bought more. =) AMED wasn't down a lot but I think it's at a good buy point right now so I initiated my second third in it. It's still fairly undervalued and if it drops back down to it's March lows (mid 30s), I'll definitely trigger my last third. Stay the course here and dust off your watch lists...deals will continue to pop up if this dip continues!
Sunday, June 15, 2008
Trigger Time!
So if anyone's been paying attention to my KinzoRLP CAPS profile, they'll notice that I've made a couple more position adds to my personal portfolio.
I bought my second third in Canadian National Railway (CNI) for my Roth IRA. They've been getting beaten down quite a bit recently due to fears of a U.S. slowdown. History has proven, however, that industrial railways are a solid recession-proof industry.
The second company that I initiated a small position in is called Ingersoll-Rand. Yes, this is out of my norm, large-cap blue-chip type stock is definitely too slow for me. But similar to CNI, there's a lot of deals in the industrial sector due to market pessimism, getting into a large-cap industrial play was exactly what I've been waiting for. Why? Well, ever since they announced to merge with Trane, I've wanted to get into the company. As with a lot of the companies out there, I believe they're at a great buy point (PEG ratio under 1).
Also, I'm testing the Dow Theory on its concept that stock market averages must confirm each other. To summarize, if the the manufacturers are producing more goods, then the transportation industry will have to ramp up as well. The transportation industry is at an all-time high therefore I feel that the manufacturers will need to catch up. I'm definitely not a technical trader, but I do believe it definitely helps in determining optimal entry points.
I bought my second third in Canadian National Railway (CNI) for my Roth IRA. They've been getting beaten down quite a bit recently due to fears of a U.S. slowdown. History has proven, however, that industrial railways are a solid recession-proof industry.
The second company that I initiated a small position in is called Ingersoll-Rand. Yes, this is out of my norm, large-cap blue-chip type stock is definitely too slow for me. But similar to CNI, there's a lot of deals in the industrial sector due to market pessimism, getting into a large-cap industrial play was exactly what I've been waiting for. Why? Well, ever since they announced to merge with Trane, I've wanted to get into the company. As with a lot of the companies out there, I believe they're at a great buy point (PEG ratio under 1).
Also, I'm testing the Dow Theory on its concept that stock market averages must confirm each other. To summarize, if the the manufacturers are producing more goods, then the transportation industry will have to ramp up as well. The transportation industry is at an all-time high therefore I feel that the manufacturers will need to catch up. I'm definitely not a technical trader, but I do believe it definitely helps in determining optimal entry points.
Thursday, June 12, 2008
Calling in the professionals...
Yes, the title is what it is. I'm actually getting a Financial Advisor. In fact, I'm getting two! My late grandparents left me some money and when I graduated from college it was passed on to me by my father. The same FA that has handled my granparents and parents account was handling this, but I think his time is over, and his conservative approach isn't quite what I'm looking for at my age.
What's interesting is that I now have two advisors with very different perspectives and investment style approaches. One of them prefers iShares and ETF type funds, whereas the other focuses mostly on mutual funds for his clients. And these are loaded mutual funds too. I'm actually a mutual fund hater, and the fact that they're front-loaded as well makes me even sicker to the stomach! But I did this mostly for the learning experience and also as a gauge against my own investing abilities. Hopefully I can get rid of the gag reflex that I'm getting whenever I think about the huge upfront costs and the yearly brokerage fee. Eww. I am happier with the other FA's approach and I'll post more on his style later.
I plan to also compare both advisors, and hopefully consolidate into one FA in about 3 years, depending on who does better. I'm hoping they both do really well, but I really want to actually beat both of them! Only time will tell...game on!
What's interesting is that I now have two advisors with very different perspectives and investment style approaches. One of them prefers iShares and ETF type funds, whereas the other focuses mostly on mutual funds for his clients. And these are loaded mutual funds too. I'm actually a mutual fund hater, and the fact that they're front-loaded as well makes me even sicker to the stomach! But I did this mostly for the learning experience and also as a gauge against my own investing abilities. Hopefully I can get rid of the gag reflex that I'm getting whenever I think about the huge upfront costs and the yearly brokerage fee. Eww. I am happier with the other FA's approach and I'll post more on his style later.
I plan to also compare both advisors, and hopefully consolidate into one FA in about 3 years, depending on who does better. I'm hoping they both do really well, but I really want to actually beat both of them! Only time will tell...game on!
Monday, June 09, 2008
Shorting...
So people ask me why I don't short since I seem to do well at picking crappy stocks on CAPS. Well if you look at my CAPS profile, you'll notice that most of my picks that I short are only giving me a 100 points or so max. But the picks that I've wrongly called to underperform have hit huge numbers. My biggest loser yet is Hawaiian Airlines (HA), which I underperformed and has had a HUGE +100% run since picking it. doh. Fortunately I've picked more winners than losers so far (crossing fingers!).
When buying stocks, the returns are unlimited as the stock price increases and if the stock plummets, the only losses will be what was put in to purchase the stock. With shorting, however, the exact opposite happens! Since we're betting that the company will do poorly, if the company skyrockets 10-fold, so does your loses. That said, compared to a potential gain of only 100% (if the stock price goes to zero), I don't see it being worth the risk at all.
When buying stocks, the returns are unlimited as the stock price increases and if the stock plummets, the only losses will be what was put in to purchase the stock. With shorting, however, the exact opposite happens! Since we're betting that the company will do poorly, if the company skyrockets 10-fold, so does your loses. That said, compared to a potential gain of only 100% (if the stock price goes to zero), I don't see it being worth the risk at all.
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