Sunday, March 11, 2007

Week in Review - CNBC Contest

Thanks Don, T and Ira for your comments.

I ended the week in the top 20% (2.33% return), and my plan is to spend the weekend, pruning my positions.
How?

  1. Sell anything with close to 3% loss ( here, I hope to learn the discipline of sticking to strategy)
  2. Buy anything that looks like a sure win for the next week and better than the worst thing in my portfolio.

Based on Ira's and Don comments, that this is a momentum game and not a strategy play, I would need to consider buying LEND and Sell CRM down 1.63%.

Hmnn, LEND - everybody and the kitchen sink is playing the sub prime game, and I can't quite figure out how to research the fact that the momentum/upside will be there.

CRM - fundamentally is good, and my thesis may hold over 10 weeks, the question is where will we end the week.

Decision, give it a day, do more homework on LEND and the sub prime sector as a whole, are they oversold? Is there a basket to diversify risk?
Gas is almost $3 in myneighbourhood, what is the outlook for oil and gas, next week.
In addition, I am at about 10% cash, which is where, I will like to be to be able to take advantage of a sudden downturn if it happens.

Top 20% is not bad for simply wanting to learn. So as not be a pig, it is do nothing weekend.

Cheers!

3 comments:

DonCasiragi said...

I would advuce to hold off buying LEND till this round of bad news quiets down. Over the weekend NEW (the worst of the subprime fall) announced it can't obtain financing and that its lenders including the big banks are coming for its neck. This means the group will be in dead waters- at pre market NEW has lost 55%, LEND-10% and NFI-8%. Of all of them , NFI looks good to me as an investment if it falls additional 25% more now. It is an REIT and obliged to pay $5 dividend at least this year after which it can suspsend; it goes for $3-4 25% lower , this bait will attract the speculators and drive up the stock when the bad news sting is gone..I say with for Wednesday-Thursday if last week is emblematic of the cyle in this sector.

DonCasiragi said...

I say wait for Wednesday-Thursday if last week is emblematic of the cyle in this sector.

P.S: Sorry people for the spelling errors..keyboard devil.LOL!

DonCasiragi said...

Ol boy, I hope u made some virtual money on the trade I gave you. You will have been up on LEND 70% today if you bought at close of business yesterday as I told u to wait. But please, sell first thing Friday morning,the trade cannot extend into the weekend bcos the bears will have their much welcomed news on Monday morning. This sub prime trade will go on for a few weeks..buy on Wednesday sell on Friday with one company sacrificed (the way NEW for this week) every week.

I have a hunch that one of these punks on Cramer Dozen list will go under next week..and me think it is LEND ( http://www.thestreet.com/_yahoo/funds/stoptrading/10344470.html?cm_ven=YAHOO&cm_cat=FREE&cm_ite=NA )


In any case, as you can notice, NFI is not on the list and I still think it is perhaps your safest bet going for next week..stay off LEND after you sell today until things clear up a little bit. In any case, short Indy from Monday to Wednesday bcos I see bad news in the horizon..they are not speaking right.

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