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Everyday Finance Portfolio en Feugo - Tripling Return of S&P500
2007-10-27 02:46:00
It was another incredible week for the portfolio, returning over 6% median and mean vs. the 2.3% return of the S&P500. There were several double digit movers, including BIDU, CHL, VIP and BPHX internationals. See prior posts for full research and analysis on these. Stateside, Wynn resorts added 10% and CROX and GRMN continued their run. Although not covered in this table, I unloaded USAT last week, as it wasn't moving anywhere fast, my SNCR option took a beating on earnings yesterday, but they spiked back up 10% today, and I unloaded some QQQQ puts midweek, only to add more again today after the rally. I now hold a cascading set at 53 and 52 to provide for some downside protection. Oil exceeding $90 sounded unfathomable months ago, but it's here. Housing is still in the doldrums, the dollar is at historical lows and the financials continue to take massive writedowns. Merill may very well be naming a new head by Monday following obscene loss from subprime. Regardless, fo...
More About: Finance , Portfolio , Return

EMC Shares Rocket in Attempt to Reach Parity on VMware Stake
2007-10-26 04:08:00
OK, so last post I highlighted that I was wrong on Apple shares so today I get to say, "I told you so!" on EMC. For weeks, I've been touting the stake that EMC has since it spun off VMware and the arbitrage opportunity there for the taking. Based on the size of the stake, for each $6 rise in VMW's stock price, EMC should have risen $1. But it didn't! On 9/24, I picked up a hundred shares at 19.73 and today the stock closed at 24.45 following today's 9% runup on earnings. These earnings stunned wall street, in large part due to a third quarter gain of $115.2 million for selling 6 million shares of VMware. I'm holding, as I still think VMware has room to run and EMC may see some follow-through as new investors plough in. (VMW was up 10% today as well!). Disclosure: Long EMC www.everydayfinance.blogspot.com
More About: Rocket , Reach , Shares , Vmware , Ares

APPLE Shares Rocket on Juicy Earnings...I was Wrong
2007-10-23 04:45:00
OK, I have to make an admission. I've been rather complacent regarding Apple 's (AAPL) prospects this year. I played a strangle option strategy prior to last quarter's earnings just breaking even in the end and didn't touch it this time around. The stock could have purchased in the 120s following the summer sell-off, but I've been thinking the stock's been overhyped. I've been wrong. Based on continuing impressive product cycles and innovation, I have to reverse my general lack of enthusiasm and endorse the stock as a long term hold. One cannot ignore the continued strength of the U.S. consumer for these new releases, the Apple computer cool-factor, and continued waves of new, innovative products. Instead of toying with volatility and hoping for massive swings one way or the other, if I had simply gone long the day I bought my iPod mini, I'd have doubled my money multiple times over, or if going long in August, I could have been looking at a quick 50% gain. Today, Apple rele...
More About: Earnings , Rocket , Wrong , Shares

Big Gainers in Monday's Rebound Session - OCTOBER 22, 2007
2007-10-23 02:12:00
Following a rather ugly Friday selloff, the S&P500 closed up .6% and the QQQQ Nasdaq tracker was up 1.2%. There were several double digit gainers in the market today, including a stalwart from the Everyday Finance portfolio. The tone of the market seemed to quickly change from concern over liquidity and further deterioration of the credit markets to relief following some decent earnings from U.S. Blue Chips today. . In terms of general market movers, Plug Power (PLUG -anyone remember this one from the internet days?) was up 18% today. Today, they announced a purchase of GenDrive fuel cell power units from Wal-Mart Stores (WMT) for use in lift trucks at one of the co's distribution centers. This is Plug Power's largest single GenDrive order to dateCeragon Networks (CRNT) was up 22% following the release of record earnings today. This is one that Mike, a regular visitor recommended, that I never got around to fully researching/endorsing, but it looks like he was on to some...
More About: October

Is 1 Hour of Your Time Worth $1200 per Year?
2007-10-18 02:02:00
I received a comment today from a seemingly skeptical reader lamenting that it's a waste of time to dedicate the efforts to strategically selecting and optimizing cash back reward credit cards in order to receive $1,200 tax free annually. The reader asked why not just put the efforts into something else? I respectfully disagree and counter, "Why not just put those same efforts toward something else AND this since it's free money with minimal effort?"I look at this a few different ways. Primarily, it only takes a few minutes to find a cash back credit card that pays you back; there are a few affiliate ads on this site alone. Then, filling out an online application takes probably 10-15 minutes, followed by perhaps another few minutes if you have to reply to a confirmation email and activate the card when it comes in the mail, etc. It is in the card companies' best interest to minimize the amount of time and effort it takes to get the card in your hand, trust me! With that in mind, ...
More About: Time , Worth , Hour , Year , Wort

The Fed Held Secret Meetings with Major Banks to Avert Disaster
2007-10-17 04:46:00
Based on a series of articles that appeared in the Wall Street Journal that did not garner much coverage in the mainstream CNBC and network airings, I wanted to highlight a secret meeting that the Fed facilitated a few weeks ago ON A SUNDAY with executives to top U.S. banks, which may have been necessary to avoid a new round of credit liquidity problems and perhaps massive troubles for Citigroup, a financial institution critical to the U.S. and the world.Here are the facts, as reported across the past few days primarily in the Wall Street Journal:Citigroup (Ticker: C ) has nearly $100 Billion in seven affiliated SIVs, or Structured Investment Vehicles. This is one quarter of all SIVs that exist globally, according to Moody's. The way they work is that they issue their own short term debt at low interest rates with the presumption that they have high credit ratings. They then use those funds to purchase higher yielding long term assets such as securities tied to mortgages (do you...
More About: Banks , Disaster , Secret , Meetings , Major

An Unholy Alliance Between Commodities And Bonds
2007-10-16 04:29:00
Guest post from Greg; Bio at bottom.The strong positive correlation between Bonds and Commodities is creating an unholy alliance and confusing investors. Strange how markets work!Just when we thought we had it all figured out, just when we became convinced that inflation would win the day, those damn Treasury Bills just refused to confirm our hypothesis.There is a somewhat strange and almost unholy alliance developing between Bonds and Commodities.Chart 1 - 10Yr Treasury Price vs. Crude Oil (green)The theory is that rising commodity prices (we have used Crude Oil in our example) is price inflationary. That is, when raw material prices rise, the general price level rises along with it.The Fixed Income markets are supposed to be hyper-sensitive to price inflation. Bonds are supposed sniff out price inflation and interest rates should rise rapidly as they discount the effect of an increase in price inflation.Therefore, a well worn economic rule is that commodities should move inversely...
More About: Alliance , Unholy