Friday, January 22, 2010

BAGAKOAA January 21, 2010 Cry, Drink, or Laugh


 January 21, 2010 Cry, Drink, or Laugh

Well, licking my wounds today. The portfolio is off about 5% this week. Ouch! So what are you gonna do.

Crying is not going to help and its way to early in the morning to drink. So I thought I would entertain myself by telling you how I do what I do.

On a day like today, I got up in plenty of time to take the dogs out, provide them nourishment, take my self out (you know what I mean), and still be in front of the terminal by 6:15 to review the Asian headlines and see what impact their news had on the opening of the market.

Then I look at the 11 portfolios I am intimately involved in. First I look at the ones that are not mine as this is not my money and I feel penultimately responsible for making sure these people don’t cry and start drinking at 6:15 in the morning. After all that is my Job. Then I check the kids and other family member accounts. Then and only then do I open the Salve Lucrum Portfolio.

As I have established, I am a Fluffy Day Trading Monkey In a Casino. I look down the list of a diversified and much to long and confusing portfolio. I ask myself what is a ASYS and why did I buy it? So I look them up on my valuation spreadsheet because I would never buy a stock until I had made sure it met my parameters. There it is on the 212 line spreadsheet ASYS. It is in the list with 43 other stocks to run the numbers on. I look them up in Schwab and Oh Yeah, they are the people who make the diffusion furnaces for the solar photovoltaic cells. Gotta to look them up. It’s up 3%. Perhaps I should not do the research. This week it seems to work better.

Then I see BURKF, what the heck is that and why did I buy 1000 shares of it at 24 cents a share. Don’t feel bad if you are looking for it because I couldn’t find it either. I actually had to Google it. They are an oil and gas exploration company. I really don’t remember buying it. I know I lost 2 cents on it today when I sold it. Checked the blog and thank God I have not mentioned it anywhere.

Then I discovered all of my paper losses are in calls due to expire in March and April. I got a January 2011 call on Valero that is down 88%. The strike price is 30 and the stock is at 18. What the heck was I doing? But I have 12 months to lose the other 12% of my money.

Then there is the March 41 dollar Best Buy Call which is 84% down. See I told you these Call options are special. BBY is at 37.67 right now so I only need a 9% increase in the stock to get back to a break even. That’s All. Please, everyone go out this weekend and buy anything at Best Buy.

Then I got a Cramer tip that is burning my butt. Shame on me for not doing the homework. I have a March $45.00 on MELI, Mercardolibre. It is kind of like a Maexican Ebay wannabe without the profitable part of the company PayPal. Of course I did not figure that out until I bought these calls and have been using the rational that a lot can happen between now and March. That sounded great in December. It sounds rational in January. It is ganna sound stupid in February, but at 82% down, I have 2 months to loose the 18%. Calls are fun.

Then there is the March 42 dollar call for JPM, That would be JP Morgan whose earnings report did not go as well as I expected and now Obama want to make sure I don’t see any profit on that call. There are actual transcripts of Sheila Bair (FDIC)and the President and she said, “Mr. President, the banking rules you are suggesting are punitive and draconian.” To which the President replied, “I don’t care, Brian Cronin has a 42 dollar call out there on JPM and a couple of preferred banking stocks and I am going to stick it to him.” Well I haven’t actually seen the transcripts but I did here something about the regulations being a bit draconian.

Then I am looking at the long list of calls with all these red numbers and I see an April IBM call just in the money and it is down a little and right below it is another April IBM call way out of the money which is down 57%. Now who the hell did that? I know I am much too bright to accidently buy two of the same equity calls of the same expiration date at two different strike prices. The people who have trusted me with their money must really be feeling special right about now.

And as I gaze down to find my best performing stock, there it is, oh yeah it is not a stock. It isn’t even an ETF. It’s a damn bond. Yeah those GMAC Smartnotes I mentioned what back in October. (Thank you Doyle). They are up almost 40%. A Bond. You might be on to something Tim. Can I buy calls on Bonds!

Salve Lucrum


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