January 26, 2007
Long Bond Moves to New Relative LowBonds have been a crappy place to be for a good long while, and they’ve now moved to the lowest level (relative to the S&P 500) since the TLT (the handiest way to play the long bond) came out back in 2002.
http://www.maoxian.com/images/200701/20070125tltw.png
time saved
time saved
Cat:[*]Bonds | Time: 10:36 am (utc+8) Comments (5)
How Do You Say Textbook Fibonacci Retracement in Chinese?http://www.maoxian.com/images/200701/20070125fxid.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 10:10 am (utc+8) Comments (13)
January 25, 2007
Broad Based BuyingStrong day, continuous buying, a classic trend day where longs had a strong tailwind (throw a dart!).
105 of the 379 ETFs I follow are trading at new highs. The S&P 500 (SPY) and MidCap 400 (MDY) are both on the list as are these three SPDRs: Financials, Materials, and Staples.
http://www.maoxian.com/images/200701/20070124xlbfp.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 8:52 am (utc+8) Comments (0)
January 24, 2007
The Importance of Monitoring Oil IntradayDay traders who were happily long during the morning with a nice broad market tailwind behind them received a jolt around 2 PM when oil turned higher and the tone took a nasty turn. A scramble to raise stops probably saved the day from turning into a loss for most. If you haven’t put USO on your “front and center” quote sheet, you should.
http://www.maoxian.com/images/200701/20070123oilqqqq.png
time saved
time saved
Cat:[*]Energies[*]Trading | Time: 10:53 am (utc+8) Comments (11)
January 23, 2007
Altucher’s Sage Investment AdviceDuring his Wallstrip interview with lovely Lindsay, the super-nerdy (I mean that as a compliment) James Altucher gave some sage advice:
“You shouldn’t buy anything . You should come up with a business idea and invest in yourself. That’s better than buying an ETF and making 8% a year.”
Most kids never get this advice; instead they read these kind of 13 Steps to Being a Better Corporate Drone things.
time saved
time saved
Cat:[*]Trading and Investing | Time: 1:53 pm (utc+8) Comments (10)
The Great Caterpillar - FXI DisconnectNoticed CAT on the new lows list and thought it would be fun to overlay 卡特彼勒’s chart with the FXI. You can see that the folks willing to pay top dollar for Chinese stocks haven’t been paying attention to what CAT’s chart is saying.
http://www.maoxian.com/images/200701/20070122catfxi.png
Related: Fools Rushing in to Chinese Stocks
time saved
time saved
Cat:[*]Trading and Investing | Time: 9:58 am (utc+8) Comments (16)
« Previous Page• Next Page
Capstone Shareholders’ Rocky Ride and Other Market ObservationsNoticed old Capstone (CPST) on the new lows list along with Whole Foods (WFMI) - you may recall my post, Pass the Mac & Cheese - and OmniVision (OVTI) - no stranger to those who read Herbie’s blog.
A ton of REITs once again populated the new highs list, along with Hong Kong (EWH), Singapore (EWS), and my old friend the Materials SPDR (XLB).
http://www.maoxian.com/images/200701/20070119cpstw.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 9:39 pm (utc+8) Comments (2)
But Is It Visually Stunning?
http://www.maoxian.com/images/200701/visuallystunning.gif
time saved
time saved
Cat:[*]Trading and Investing | Time: 8:36 pm (utc+8) Comments (0)
January 19, 2007
Consumers Unaffected by So-Called Housing Bust, and Other Market ObservationsWorst day of selling I’ve seen since last November 27th, but look who’s on the new highs list: the Retail HOLDR (RTH) and the Consumer Discretionary SPDR (XLY). Do you listen to talking heads blather about a “housing bust” and the bedraggled American consumer or do you listen to what the market is saying?
http://www.maoxian.com/images/200701/20070118xlyrthm.png
Review the Consumer Discretionary SPDR Components (SBUX the tenth largest holding, ha!)
time saved
time saved
Cat:[*]Trading and Investing | Time: 10:35 am (utc+8) Comments (9)
January 18, 2007
Our Dimmed Passion for LibertyI love John Mortimer’s Rumpole stories and especially this line from Rumpole and the Alternative Society:
“I had brought a number of law reports on the question of agent provocateur and was interested to discover that it was the old hanging judges who regarded these beasts with particular disfavour; it’s odd how gentler days have somehow dimmed our passion for liberty.”
One of my favorite lines from that same story that I often use on my girlfriends (though never on She Who Must Be Obeyed):
“You look as glamorous as an unmade bed.”
time saved
time saved
Cat:[*]Personal | Time: 4:32 pm (utc+8) Comments (0)
Intel Still Sucks After All These Years, and Other Market ObservationsIntel was $21 ten years ago and it’s $21 today, enough said. Rotten tone generally today but my new highs list is packed nevertheless.
http://www.maoxian.com/images/200701/20070117intcw.png
RACK Attack: Check out that after-hours plunge. All day traders watching their scanners probably saw it within a minute of the plunge, but that doesn’t mean they could get their shorts on.
http://www.maoxian.com/images/200701/20070117rack5.png
A few observations from the new highs list:
[*]General Motors 7 3/8 bonds (HGM) - must cheer shareholders like ControlledGreed;[*]Healthcare in favor, our old friend the XLV at a new high;[*]Chicago Merc (CME) - still great to be The House;[*]Beijing Med-Pharm (BJGP) - never heard of ‘em, China-mania continues;[*]LJ Int’l (JADE) - a reader just told me about this one and I’m going to check out a store today, China mania ;[*]Home Inns (HMIN) - yet another recent China IPO, Bill expected it to be hot, China mania;[*]Shanda (SNDA) - it’d be exciting if it didn’t used to be $45 (now $22), China mania;[*]Crocs (CROX) - and yes, I do wear Crocs and love ‘em (got some for Xmas);[*]Mastercard (MA) - I read the 200+ page prospectus and planned to buy the IPO then got busy with other stuff and forgot (yet another major mistake made);[*]and finally Dow Industrial Average components McDonald’s (MCD) and Procter & Gamble (PG) - always good to see old friends.time saved
time saved
Cat:[*]Trading and Investing | Time: 11:32 am (utc+8) Comments (5)
January 17, 2007
Using ETFs to Trade the Price of OilLast weekend I updated the list of ETFs I follow. There are now 379 (!) symbols in my ETF universe, but I only look closely at the 40 most liquid ones, which includes the US Oil Fund (USO). I discovered that there are now two other oil funds in addition to USO: iPath ETN Crude Oil (OIL), and PowerShares DB Oil Fund (DBO), which are both relatively thinly traded.
[*]United States Oil Fund “The investment objective of the United States Oil Fund is for changes in percentage terms of the units’ net asset value to reflect the changes in percentage terms of the spot price of West Texas Intermediate (’WTI’) light, sweet crude oil delivered to Cushing, Oklahoma (’WTI light, sweet crude oil’), less USOF’s expenses.”
[*]iPath Goldman Sachs Crude Oil Total Return Index ETN “The iPath Goldman Sachs Crude Oil Total Return Index ETN is a subindex of the Goldman Sachs Commodity Index. The Goldman Sachs Crude Oil Total Return Index reflects the returns that are potentially available through an unleveraged investment in the West Texas Intermediate (WTI) crude oil futures contract plus the Treasury Bill rate of interest that could be earned on funds committed to the trading of the underlying contracts.”
[*]PowerShares DB Oil Fund “The PowerShares DB Oil Fund is based on the Deutsche Bank Liquid Commodity Index - Optimum Yield Oil Excess Return and managed by DB Commodity Services LLC. The Index is a rules-based index composed of futures contracts on Light Sweet Crude Oil (WTI) and is intended to reflect the performance of crude oil.”
Oil went to a new low today and USO was one of the top ten most actively traded ETFs.
http://www.maoxian.com/images/200701/20070116oiletfs.png
Related: Oil Begins New Year with a Breakdown
time saved
time saved
Cat:[*]Trading and Investing | Time: 7:34 am (utc+8) Comments (8)
January 14, 2007
Maoxian’s Top Ten Links — January 12, 2007The internet is still impossibly slow from China, so I apologize for my irregular posting schedule. It’s 5 AM on a Sunday morning here and things are working just well enough for me to kick out a few posts, including this Top Ten list (with a couple of bonus links since it’s been awhile since the last one).
[*]How China is making me into a worse person (#1 in a series) “You can work up all sorts of historical or anthropological explanations behind every-man-for-himself behavior. It’s a survival imperative when there are too many people for too few resources. It’s an effect of big, anonymous city life — what happens when a city is three times larger than New York — or a legacy of the mistrustfulness of the Cultural Revolution years. Who knows.”
James Fallows moved to Shanghai recently and is getting a crash course in Chinese culture.
[*]A distinct lack of value-add from this year’s top twaddlists Lucy Kellaway’s business cant and gibberish awards for 2006.
[*]Shenzhen’s citizens are defending their rights “… the quiet, well organized challenges of the newly affluent may have the deepest impact on this country’s future.”
This is how non-violent political change always happens, isn’t it?
[*]Who Americans Are and What They Do, in Census Data “Adolescents and adults now spend, on average, more than 64 days a year watching television, 41 days listening to the radio and a little over a week using the Internet.”
I spend zero time watching television or listening to the radio, but I know I spend a lot more than 64 days a year using the internet.
[*]Middle School Girls Gone Wild “They writhe and strut, shake their bottoms, splay their legs, thrust their chests out and in and out again. Some straddle empty chairs, like lap dancers without laps. They don’t smile much. Their faces are locked from grim exertion, from all that leaping up and lying down without poles to hold onto. ‘Don’t stop don’t stop,’ sings Janet Jackson, all whispery. ‘Jerk it like you’re making it choke. …Ohh. I’m so stimulated. Feel so X-rated.’ The girls spend a lot of time lying on the floor. They are in the sixth, seventh and eighth grades.”
I’m appalled by this trend too … is it all part of the Dumbing of America?
[*]Going to the Mattresses “Here’s the lowdown: Mattress makers rename identical products for each different retail store. Different labels, exact same guts. Why? Obfuscation. It’s hard to shop for the lowest price when you can’t compare apples to apples.”
I know this from our experience buying a mattress years ago. One good piece of advice in the article is: “Anything over $1,500 and you’re just paying for prestige.” I recommend you buy your Simmons, Serta, or Sealy mattress at CostCo or Sam’s Club.
[*]Power Washing 188 Suffolk St. (Photo) A century of grime?
[*]Typical Traffic Pattern in China (Photo) When Roundabouts Fail… I don’t know the Chinese word for “gridlock” but when I find out I’ll let you know.
[*]Little Asia on the Hill “This fall and last, the number of Asian freshmen at Berkeley has been at a record high, about 46 percent. The overall undergraduate population is 41 percent Asian.”
The unintended (?) consequences of Proposition 209.
[*]What Does 200 Calories Look Like? I loathe celery.
[*]Road Workers with a Sense of Humor (Photo) Do you think that sign reduced or increased road rage?
[*]Ant Carrying a Microchip (Photo) Model worker in the future economy.
time saved
time saved
Cat:[*]Links | Time: 5:27 am (utc+8) Comments (8)
« Previous Page• Next Page
January 12, 2007
White Russian Recipe[*]2 ounces vodka (any brand, vodka is vodka, just ask the Grey Goose guy)[*]1 ounce Kahlua (there’s only one Kahlua)[*]3 ounces cream (best) or Half & Half (passable) or whole milk (in a pinch)[*]iceFill glass (use 7 ounce size) with ice. Add vodka, Kahlua, cream, and stir stick.
I like my White Russians a little more vodka-y and a little less Kahlua-y. The traditional recipe is equal parts vodka and Kahlua, but I’ve improved on it. ;-)
Please share your variation by leaving a comment!
time saved
time saved
Cat:[*]Personal | Time: 6:13 pm (utc+8) Comments (11)
The Bulls Are Not QIDding AroundThe market has been very strong the last couple of days — typical trend days of continuous buying. This means the poor shorts continue to have their asses handed to them as young QID falls to a new low.
http://www.maoxian.com/images/200701/20070111qidd.png
Related:
UltraShort Q’s Update
UltraShort Q’s Come Front and Center
ETF to Watch - UltraShort QQQ (QID)
time saved
time saved
Cat:[*]Trading and Investing | Time: 10:08 am (utc+8) Comments (9)
January 10, 2007
What It Means To Be HumanI watched The Death of Mr. Lazarescu last night. It was monumentally depressing (a Romanian import after all), but it was also very good, and I’d recommend it to anyone who is not feeling suicidal. Among other things, it’s a stunning indictment of, not just socialized medicine, but the medical establishment everywhere.
It’s the best movie I’ve seen since Der Untergang.
David Denby’s review is good: “An acrid kind of black comedy….”
time saved
time saved
Cat:[*]Personal | Time: 2:44 pm (utc+8) Comments (7)
Apple’s Intraday Action Following iPhone AnnouncementTricky action around the time of the iPhone announcement, but Dummies were given a good spot around $88 to get aboard with minimal risk. As my old trading buddy Susan (who has since retired to the Caribbean, literally) liked to say, let’s take it down to take it up. AAPL did 520,000+ trades, impressive.
http://www.maoxian.com/images/200701/20070109aapl5.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 11:31 am (utc+8) Comments (16)
January 9, 2007
Selected Excerpts from The Deep Blue Good-ByI try to re-read a few Travis McGee novels every year and was able to finish The Deep Blue Good-By (1964) during our recent vacation. Here are the bits I liked best:
“I am wary of a lot of things, such as plastic credit cards, payroll deductions, insurance programs, retirement benefits, savings accounts, Green Stamps, time clocks, newspapers, mortgages, sermons, miracle fabrics, deodorants, check lists, time payments, political parties, lending libraries, television, actresses, junior chambers of commerce, pageants, progress, and manifest destiny. I am wary of the whole dreary deadening structured mess we have built into such a glittering top-heavy structure that there is nothing left to see but the glitter, and the brute routines of maintaining it.”
“These are the playmate years, and they are demonstrably fraudulent. The scene is reputed to be acrawl with adorably amoral bunnies to whom sex is a pleasant social favor. The new culture. And they are indeed present and available, in exhausting quantity, but there is a curious tastelessness about them. A woman who does not guard and treasure herself cannot be of much value to anyone else. They become a pretty little convenience, like a guest towel. And the cute little things they say, and their dainty little squeals of pleasure and release are as contrived as the embroidered initials on the guest towels. Only a woman of pride, complexity and emotional tension is genuinely worthy of the act of love, and there are only two ways to get yourself one of them. Either you lie, and stain the relationship with your own sense of guile, or you accept the involvement, the emotional responsibility, the permanence she must by nature crave. I love you can be said only two ways.”
“ cards are handy, but I hate to use them. I always feel like Thoreau armored with a Leica and a bird book. They are the little fingers of reality, reaching for your throat. A man with a credit card is in hock to his own image of himself. But these are the last remaining years of choice. In the stainless nurseries of the future, the feds will work their way through all the squalling pinkness tattooing a combination tax number and credit number on one wrist, followed closely by the I.T. and T. team putting the permanent phone number, visaphone doubtless, on the other wrist. Die and your number goes back in the bank. It will be the first provable immortality the world has ever known.”
“The worst thing about having a hundred and eighty million people is looking down and seeing how much room there is for more.”
“I walked on a fabric of reality but it had an uncomfortable give to it. You could sink in a little way. If you walked too much and came to a weak spot, you could fall through. I think it would be pretty black down there.”
“ looked shrunken and misplaced, like a dead worm in a birthday cake.”
“ family was a circus act, balanced on a small platform atop a swaying pole, as the crowd goes ahhh, anticipating disaster. A vain foolish man and a careless young wife and a tortured girl, swaying to the long drum roll. When it fell the unmarked House Beautiful would sell readily, the Lincoln would be acquired by a Mexican dentist. Who would survive? perhaps, as he had the shortest distance to fall.”
“Her caresses were quick and light, and her body turned and glowed and glided and changed in her luxurious presentation of self, her mouth saying darling and her hair sweet in darkness, a creature in endless movement, using all of herself the way a friendly cat will bump and twine and nudge and purr. I wanted to take her on her basis, readying her as graciously as she had made herself ready, with an unhurried homage to all her parts and purposes, an intimate minuet involving offer and response, demand and delay, until the time when it would all be affirmed and taken and done with what, for want of a better name, must be called a flavor of importance.”
“In these documented times, where we walk lopsided from the weight of identifications, only the most clever and controlled man can hope to exist long on a hijacked fortune.”
“They have been taught that if you are sunny, cheery, sincere, group-adjusted, popular, the world is yours, including barbecue pits, charge plates, diaper service, percale sheets, friends for dinner, washer-dryer combinations, color slides of the kiddies on the home projector, and eternal whimsical romance — with crinkly smiles and Rock Hudson dialogue. So they all come smiling and confident and unskilled into a technician’s world, and in a few years they learn that it is all going to be grinding and brutal and hateful and precarious. These are the slums of the heart. Bless the bunnies. These are the new people, and we are making no place for them. We hold out the dream in front of them like a carrot, and finally say sorry you can’t have any. And the schools where we teach them non-survival are gloriously architectured. They will never live in places so fine, unless they contract something incurable.”
“A few years ago she would have been breathtakingly ripe, and even now, in night light, with drinks and laughter, there would be all the illusions of freshness and youth and desirability. But in this cruelty of sunlight, in this, her twentieth year, she was a record of everything she had let them do to her. Too many trips to too many storerooms had worn the bloom away. The freshness had been romped out, in sweat and excess. The body reflects the casual abrasions of the spirit, so that now she could slump in her meaty indifference, as immunized to tenderness as a whore at a clinic.”
“This is the queasy shadowland, and they don’t even work hard at that because they have never learned to work at anything. They turn sloppy, and when the youngness is gone, there isn’t much left. Just the dead eyes and the small meaty skills and the feeling their luck went bad sometime, when they weren’t watching. Fifteen to twenty-five is the span, and they age quickly and badly. These are the bunnies who never find a burrow.”
“I thought of brutal leathery hands. Behind the agreeable grin he was as uncompromising as a hammer. Beast in his grin-mask. A clever, twisted thing, hunting for that perversion of innocence, the horrification of gentleness which would feed his own emptiness.”
Kind of dark, depressing stuff now that I’ve typed it out, but it all rings true even 40 years later.
time saved
time saved
Cat:[*]Personal | Time: 11:34 am (utc+8) Comments (7)
January 8, 2007
Internet Still Sucking from ChinaI have dozens of unread articles built up at delicious since there was an earthquake somewhere in the South China Sea (?) recently and Internet access has become seriously crappy from China. Assuming it gets fixed soon, I’ll probably do a Top Twenty links post as opposed to the Usual Top Ten. Thanks for your patience.
time saved
time saved
Cat:[*]Internet/Media | Time: 7:38 pm (utc+8) Comments (2)
January 7, 2007
Oil Begins New Year with a BreakdownThe price of crude oil peaked last July and has been in a downtrend more or less ever since. Price of the US Oil Fund (what I follow closely now since it’s easier to trade than Crude Oil itself) celebrated the New Year by breaking down out of the $50 - $55 range that it has been chopping around in since last October.
http://www.maoxian.com/images/200701/20070105usod.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 10:34 am (utc+8) Comments (5)
time saved
time saved
Cat:[*]Personal | Time: 12:04 pm (utc+8) Comments Off
« Previous Page• Next Page
January 5, 2007
Fools Rushing in to Chinese StocksI wonder how many geniuses are going to get trapped in the FXI here? They must have read in Kiplinger’s or Money magazine that China was one of the best performing stock markets in the world last year and they now want a piece of the action… predictably pathetic behavior.
http://www.maoxian.com/images/200701/20070104fxiw.png
UPDATE: FXI dropped 4% from the open on about 4.5 times average volume — my 12 readers acted fast. ;-)
http://www.maoxian.com/images/200701/20070105fxi15.png
time saved
time saved
Cat:[*]China[*]Trading and Investing | Time: 7:56 pm (utc+8) Comments (9)
January 4, 2007
Convergence of Earnings Quality?Strange comment in this week’s Barron’s from Arjun Divecha, a Partner at Grantham, Mayo, Van Otterloo:
“… if you are Dell and you are selling most of your new business to China or India or places like them, why should somebody pay a higher P/E for your stock relative to some Chinese PC maker’s? The quality of earnings at U.S. companies used to be different than the quality of, say, a Chinese company’s earnings, but today they are basically starting to converge.”
Does he mean that Dell’s earnings quality is as shifty as any Chinese PC maker’s? A convergence of bad financials?
time saved
time saved
Cat:[*]China[*]Trading and Investing | Time: 12:08 pm (utc+8) Comments (0)
« Previous Page• Next Page
Subprime Mortgage Lenders’ Submerging Share PricesI noticed subprime mortgage lenders New Century Financial (NEW) and Accredited Home Lenders (LEND) on the new lows list today. Seeing LEND there surprised me because I remember it being on my Notable New Highs list earlier this year. LEND’s share price has been chopped in half in the last six months.
Looks like the market is anticipating lots of defaults as the teaser-rate loans from 2005 reset next year? I welcome comments from people with insight into the state of the mortgage lending market now.
http://www.maoxian.com/images/200612/20061208lendw.png
UPDATE: My spam blocker knocked out all the comments that contained the term “mortgage” I think, but a reader emailed me the following comment so I’m able to post it in full:
Just a note with regards to LEND and NEW.
Being a Mortgage Broker for 20 years, I’ve rode the wave up and now it’s coming down.
Most of the subprime borrowers have been refinancing every other year and pulling money out, living on equity. I’ve seen hundreds of chain of title recordings showing this.
Most brokers when they refinance a client will go through another sub prime lender to avoid dealing with the current sub prime lender, and you will see this on a chain of title. Now that property values have stopped going up, a lot of borrowers are unable to refinance and pull money out.
We have seen the current sub-prime rates inch up over the last 3 months, mainly from the secondary market downgrading the CMO’s from these lenders.
As of now, it’s becoming difficult helping a lot of clients because of the higher rates and with property values starting to fall, appraisals aren’t coming in at a high enough value to allow us to refinance some of these customers.
If they can’t be helped, most of them are in serious trouble from the standpoint most sub-prime loans are 2/28 or 3/27 (fixed for 2 or 3 years) then they re-adjust.
Most sub-prime loans, being adjustables are based on an index, usually the Libor index which say is in the mid 4 percent range plus the margin which is on average 6 percent.
Given this, most of these borrowers are re-adjusting from a start rate of around 6 to 7 percent when their loan was originated a couple of years ago to a new rate of around 9 to 10 percent when it re-adjusts.
Most of these borrowers will have a extremely tough time paying the new payment. And remember, most of these borrowers didn’t have good credit to begin with, that’s why they were given a sub-prime loan.
Mike
Chicago, IL
time saved
time saved
Cat:[*]Trading and Investing | Time: 2:42 pm (utc+8) Comments (4)
« Previous Page• Next Page
December 5, 2006
New Small-Cap High Relatively UnimpressiveI thought it worth pointing out that although the Small Caps (as measured by the Russell 2000 Index) have moved to a new all-time high, they haven’t surpassed the relative high made last May.
http://www.maoxian.com/images/200612/20061204iwmw.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 12:34 pm (utc+8) Comments (0)
« Previous Page• Next Page
Crazy Play Du Jour — Xenonics (XNN)(Read through the Dummy Lessons if you’re not already a Dummy.)
http://www.maoxian.com/images/200611/20061130xnn15.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 10:36 am (utc+8) Comments (15)
Notable New Highs — November 30, 2006Blah morning, some buyers showed up in the afternoon but a funny plunge at the close.
Xenonics was the Crazy Play of the Day. If a day trader’s scanner is not picking up something like XNN from the get-go, they’ve got a serious problem. Xenonics gets a bonus for starting with the letter ‘X’ and ending with “-onics” — a sure-fire winner. ;-)
Kerkorian sold his entire stake in GM?!? Wow, I’d like to see the tax bill for that short-term trade.
http://www.maoxian.com/images/200611/20061130nnh.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 10:09 am (utc+8) Comments (0)
November 30, 2006
Target Market: China’s Little EmperorsEyeing a Billion Tea Drinkers, Starbucks Pours It On in China, by Janet Adamy (let me know if this link doesn’t work for non-subscribers)
On a warm summer evening at a Starbucks in downtown Shanghai, customers lined up at the counter to order mango Frappuccinos, fruit and vegetable cups and blueberry cheesecake. Warren Guo, a 30-year-old who works in foreign trade, sat on the patio and shared a piece of cheesecake with his friend David Wang, 35, who also works in foreign trade. Mr. Guo says he doesn’t like coffee but comes to Starbucks because there are “many girls.”
There’s an SBUX in my office building and I visit it occasionally (there’s also a Pacific Coffee, which is much nicer). It’s true, no one except foreigners orders coffee, and the place is filled with attractive young women keen on meeting guys who are foolish enough to fork over $3 for a 30 cent cup of the devil’s brew.
time saved
time saved
Cat:[*]China | Time: 10:46 am (utc+8) Comments (8)
Notable New Highs — November 29, 2006Buying in the morning, a bout of selling in the early afternoon, but late afternoon buyers took it up into the close.
On the way home from a dinner last night at 9 PM, I got trapped in traffic once again at Guomao Qiao (World Trade Center Bridge). I don’t get annoyed when this happens. Instead I think of portfolio holdings XOM (ExxonMobil) and PTR (PetroChina) — both trading at all-time highs.
http://www.maoxian.com/images/200611/20061129nnh.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 10:05 am (utc+8) Comments (6)
November 29, 2006
Slip Sliding AwayLongtime readers know I’m not a fan of the buck (except for passing it). We live in China and choose to be paid in Chinese Yuan and long ago diversified more than half our assets out of dollar-denominated stuff.
Here’s a smattering of posts I’ve written over the last year related to the US Dollar.
ETF to Watch — Euro Currency Trust (FXE)
The Beginning of the End of the American Republic
The Boomers Will Sell Their Assets to Whom and at What Price?
A Haven for Biomedical Freedom
Buffett Cuts Dollar Short Just As Slide Set to Resume
Nothing Can Save the US Dollar
Trading with the Trend: US Dollar Index
The US Dollar Resumes Its Slide
http://www.maoxian.com/images/200611/20061128fxed.png
Whoa God only knows, God makes his plan
The informations unavailable to the mortal man
We’re workin our jobs, collect our pay
Believe we’re gliding down the highway, when in fact we’re slip sliding away
time saved
time saved
Cat:[*]Trading and Investing | Time: 11:34 am (utc+8) Comments (8)
« Previous Page• Next Page
Google’s Dizzying Climb Above $5.00Thinking how this story would read if GOOG did a 100 for 1 split:
Two different words leap to mind upon hearing the news that Google’s share price surpassed $5.00.
Juggernaut and bubble.
Maybe a third word, too: Wow.
One of America’s new bellwether companies, Google Inc. closed Tuesday at $5.0965 a share. Having gone public just two years ago at $0.85 a share, it’s a remarkable run-up in price for an 8-year-old California firm that searches the Internet for information on everything from how to fix a PB&J sandwich to the discography of Jelly Roll Morton. It makes money by selling ads that millions of people click on each day.
“People don’t want to be left behind with a stock like this,” said Scott Kessler, an equity analyst who follows Google for Standard & Poor’s. “They don’t want to tell their friends they weren’t smart enough not to take part. That momentum is part of the story.”
http://www.maoxian.com/images/200611/20061122googw.png
time saved
time saved
Cat:[*]Internet/Media[*]Trading and Investing | Time: 11:36 am (utc+8) Comments (0)
Notable New Highs — November 22, 2006Good buying all day long — a classic trend day, the bread and butter time for traders who spend most of their days fighting the chop and staying alive.
http://www.maoxian.com/images/200611/20061122nnh.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 9:37 am (utc+8) Comments (0)
« Previous Page• Next Page
UltraShort Q’s UpdateThe UltraShort QQQ ETF (QID) had its biggest day ever yesterday. Volume was 3,948,700 shares (around three times the 65-day average volume) and did over 8,000 trades. Impressive. It will be an interesting day when the QQQQ (now $43) and the QID (now $54) cross paths — maybe then TraderMike will begin to like the ‘R’ situation. ;-)
I first featured the QID as an ETF to Watch back in July and then brought it Front and Center in August.
http://www.maoxian.com/images/200611/20061108qidd.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 10:59 am (utc+8) Comments (11)
A Look at WFMI’s After-Hours ActionWhole Foods blew up on Thursday afternoon. Another good example of where paying attention to after-hours action could have made you a pretty penny.
Bank of America analyst Scott A. Mushkin cut his 12-month price target for the shares from $77.50 to $43 and also reduced his estimates of how much the company will earn the next two years.
“Cut” doesn’t quite cut it here… how about slashed! 45% revisions deserve at least a “slashed.”
http://www.maoxian.com/images/200611/20061103wfmi5.png
Related: The End of Whole Foods’ Fabulous Run, or, Pass the Mac & Cheese Please (Aug. 10, 2006)
time saved
time saved
Cat:[*]Trading and Investing | Time: 9:45 am (utc+8) Comments (2)
Throw the Bums OutLooks like the Republicans are going to lose control of the House but keep control of the Senate:
http://www.maoxian.com/images/200610/senate.png
Republican Party to retain control of the US Senate in 2006 election
http://www.maoxian.com/images/200610/house.png
Republican Party to retain control of the US House of Representatives in 2006 election
time saved
time saved
Cat:[*]Personal | Time: 11:52 am (utc+8) Comments (3)
A Look at GOOG’s After-Hours ActionGOOG reported surprisingly good Q3 earnings and the stock jumped a tad after-hours. Here’s a conventional candlestick chart along with a candlevolume chart showing the post-earnings-release action.
http://www.maoxian.com/images/200610/20061019goog5.png
http://www.maoxian.com/images/200610/20061019goog5cv.png
Related: GOOG’s After-Hours Action, January 31, 2006 (mirror image)
time saved
time saved
Cat:[*]Internet/Media | Time: 10:29 am (utc+8) Comments (7)
Notable New Highs — October 19, 2006Chop. If GOOG closes above $475 tomorrow I will make it a Notable. ;-)
http://www.maoxian.com/images/200610/20061019nnh.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 10:12 am (utc+8) Comments (0)
October 19, 2006
Notable New Highs — October 18, 2006Selling all day long but Big Pharma (PPH), Healthcare (XLV), Utilities (XLU), and our old friend the REITs (IYR) are all trading at New Highs.
http://www.maoxian.com/images/200610/20061018nnh.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 9:45 am (utc+8) Comments (0)
October 18, 2006
The Most Important Quality of a Trader: A Willingness to Take Crazy Risks with His Bar Mitzvah MoneyI read this interview with a guy who spun $12,415 of Bar Mitzvah money into $1.65 million during the bubble with amusement.
He describes his best (?) trade:
Illinois Superconductor announced on a Friday that their revolutionary superconducting product would be featured that weekend on a major news channel; I think it was CNN or 60 Minutes. This was back in 2000 so the stock had already gone from $10ish to $17ish that week, but I figured even if the product was a dud, they would hype it up and make it look incredible on national TV. Back then people would “invest” in anything with hype so it would be good for a point or two on a Monday morning gap.
So, I put most of my net worth, 10,000 shares, long over the weekend at $17/share. I watched the program and sure enough everyone started talking that it was the next Microsoft. It just kept going up premarket…19..20…21 and I desperately wanted to sell by 8:30am at $24ish, but back then Suretrade didn’t allow premarket trading so I was forced to wait for the market open. I put my order to sell right at the open and it still took about 10 minutes to execute because there were so many buy orders. I finally sold at $29ish and I just couldn’t believe it. One day later it hit $39 before plummeting.
I was day trading back then and recall that ISO (then ISCO) play well. Here’s a daily chart from February/March 2000 to refresh memories:
http://www.maoxian.com/images/200610/sykesiso.png
Oddly, there are no profiles of the kids who plunged all their Bar Mitzvah money into Illinois Superconductor at $45.
time saved
time saved
Cat:[*]Trading and Investing | Time: 9:50 am (utc+8) Comments (6)
Cat:[*]Internet/Media | Time: 1:39 pm (utc+8) Comments (4)
« Previous Page• Next Page
A Look at GOOG’s After-Hours ActionGOOG reported surprisingly good Q3 earnings and the stock jumped a tad after-hours. Here’s a conventional candlestick chart along with a candlevolume chart showing the post-earnings-release action.
http://www.maoxian.com/images/200610/20061019goog5.png
http://www.maoxian.com/images/200610/20061019goog5cv.png
Related: GOOG’s After-Hours Action, January 31, 2006 (mirror image)
time saved
time saved
Cat:[*]Internet/Media | Time: 10:29 am (utc+8) Comments (7)
Notable New Highs — October 19, 2006Chop. If GOOG closes above $475 tomorrow I will make it a Notable. ;-)
http://www.maoxian.com/images/200610/20061019nnh.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 10:12 am (utc+8) Comments (0)
October 19, 2006
Notable New Highs — October 18, 2006Selling all day long but Big Pharma (PPH), Healthcare (XLV), Utilities (XLU), and our old friend the REITs (IYR) are all trading at New Highs.
http://www.maoxian.com/images/200610/20061018nnh.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 9:45 am (utc+8) Comments (0)
October 18, 2006
The Most Important Quality of a Trader: A Willingness to Take Crazy Risks with His Bar Mitzvah MoneyI read this interview with a guy who spun $12,415 of Bar Mitzvah money into $1.65 million during the bubble with amusement.
He describes his best (?) trade:
Illinois Superconductor announced on a Friday that their revolutionary superconducting product would be featured that weekend on a major news channel; I think it was CNN or 60 Minutes. This was back in 2000 so the stock had already gone from $10ish to $17ish that week, but I figured even if the product was a dud, they would hype it up and make it look incredible on national TV. Back then people would “invest” in anything with hype so it would be good for a point or two on a Monday morning gap.
So, I put most of my net worth, 10,000 shares, long over the weekend at $17/share. I watched the program and sure enough everyone started talking that it was the next Microsoft. It just kept going up premarket…19..20…21 and I desperately wanted to sell by 8:30am at $24ish, but back then Suretrade didn’t allow premarket trading so I was forced to wait for the market open. I put my order to sell right at the open and it still took about 10 minutes to execute because there were so many buy orders. I finally sold at $29ish and I just couldn’t believe it. One day later it hit $39 before plummeting.
I was day trading back then and recall that ISO (then ISCO) play well. Here’s a daily chart from February/March 2000 to refresh memories:
http://www.maoxian.com/images/200610/sykesiso.png
Oddly, there are no profiles of the kids who plunged all their Bar Mitzvah money into Illinois Superconductor at $45.
time saved
time saved
Cat:[*]Trading and Investing | Time: 9:50 am (utc+8) Comments (6)
Notable New Highs — October 17, 2006CME buys BOT (#8 Notable), eh? As long as they don’t remove Ceres from the top of the Board of Trade building I’ll be happy. (Some things are sacred, and yes, I miss living in Chicago.)
Selling from the get-go (day traders favoring the short side had a tailwind) with some nonsense starting around 14:30 to mess up the best laid plans.
http://www.maoxian.com/images/200610/20061017nnh.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 9:17 am (utc+8) Comments (0)
WallStrip LaunchesWallStrip launched a couple of days ago, and I contributed my first post yesterday: 6.2 Million Crack(Berry) Heads and Counting. I like the idea of reading a dozen or so different commentaries on a single stock at the same time. There will probably be a lot of tweaks and improvements to the site in coming weeks, but it’s a promising start and I’m happy to be a part of it. Be sure to check WallStrip out if you haven’t already.
time saved
time saved
Cat:[*]Internet/Media | Time: 8:05 am (utc+8) Comments (7)
October 17, 2006
The Wisdom of Calvin TrillinTaken from Enough’s Enough:
“If someone you don’t know starts calling you by your first name, keep your hand on your wallet.”
“The rationale used to explain tax legislation that seems to favor the rich usually comes down to a notion that is fairly simple to state: the less rich people have to pay in taxes, the better off the rest of us are.”
“It has taken me a long time to understand what was meant by supply-side economics: we have a limited supply of rich people, so we must always be on their side.”
time saved
time saved
Cat:[*]Personal | Time: 9:09 pm (utc+8) Comments (0)
Missing PoppyOnce, in a drug rehabilitation center in Newark, George Bush (Sr.) said to one of the residents, “Did you come here and say, ‘The heck with it, I don’t need this darn thing’?”
After his return from China in 1975, when asked whether he had met any common Chinese people, GHWB replied: “Oh yes. They gave me a boy to play tennis with.”
time saved
time saved
Cat:[*]Personal | Time: 3:21 pm (utc+8) Comments (0)
83-Year-Old Sumner Redstone’s Eyes Are Not O’ Th’ BestJeff Matthews is a top stock market blogger because he writes lines like this one:
“MySpace is safely ensconced within the corporate umbrella of News Corp, whose crafty CEO, Rupert Murdoch, acquired that social networking website a year and a half before Viacom Chief Sumner Redstone learned what a ’social networking’ website was and began flailing around, King Lear-like, exiling poor Tom Freston from his increasingly irrelevant Old-Media kingdom.”
time saved
time saved
Cat:[*]Internet/Media | Time: 1:39 pm (utc+8) Comments (4)
« Previous Page• Next Page
Media General in Full RetreatControlled Greed is a fine “value investor” blog that I’m happy to include in my Blogroll; I recommend you check it out if you haven’t already. CG owns Media General which I have chastised him about from time to time — I think almost all the newspaper companies are value traps. (He also owns DECK, which graces today’s Notable New Highs list.)
MEG missed earnings and went ker-plunk* yesterday. I wonder if Mario Gabelli has asked his grandkids if they’ve ever read a newspaper?
http://www.maoxian.com/images/200610/20061011megw.png
* Ker-plunk is a term reserved only for sophisticated “Top Stock Market Bloggers” like me.
time saved
time saved
Cat:[*]Internet/Media[*]Trading and Investing | Time: 10:02 am (utc+8) Comments (1)
Notable New Highs — October 11, 2006Things were OK until 2 PM sharp when selling started, later accelerated by Lidle’s strikeout. I am wearing a 15-year-old pair of Birkenstocks as I type this, but there’s CROX in 10th place, hmmmm.
http://www.maoxian.com/images/200610/20061011nnh.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 9:24 am (utc+8) Comments (2)
October 11, 2006
Yahoo! Crushed by Google Since Day OneI noticed YHOO on the new lows list and thought it would be fun to chart Yahoo’s performance relative to Google since GOOG went public back in August 2004.
http://www.maoxian.com/images/200610/20061010yhoogoog.png
My only concern about Google’s purchase of YouTube is that China will inevitably block the site and I won’t be able to get my fix of Ali G (Booyakasha!) anymore.
“We all know it’s called da bionic, da bomb, da puff, da black, da sensei, da chronic, da sweet mary jane, da shit, da bomb, da ganja, da reefer, da bud, da buddha, da homegrown, da ill, da maui maui, da method, da pot, da shake, da skunk, da stress, da thai, da whacky … but is there any other terms that parents should be aware of?”
time saved
time saved
Cat:[*]Internet/Media[*]Trading and Investing | Time: 10:05 am (utc+8) Comments (5)
« Previous Page• Next Page
Another Impossible to Catch RIMM ShotBack in March I wrote a post about RIMM’s after-hours action called RIMM Shot Nearly Impossible to Catch. Well yesterday it did it again except this time it went from $85 to $100 instead of from $72 to $87. One company offered me a free “Crackberry” but I refused knowing that it would further unleash the obsessive-compulsive geek in me. ;-)
http://www.maoxian.com/images/200609/20060929rimm1.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 10:04 am (utc+8) Comments (10)
Notable New Highs — September 29, 2006Kind of a blah morning with slightly positive bias, a crummy blah afternoon with slightly negative bias, and then a blast of selling in the last hour. No doubt the last four trading days have been extremely frustrating for day traders.
http://www.maoxian.com/images/200609/20060929nnh.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 9:41 am (utc+8) Comments (4)
September 29, 2006
DIVX for DummiesDIVX has been active since its recent IPO and is worth keeping an eye on (for the time being anyway). Assuming Dummies didn’t get long above the third bar, a sweet little narrow range bar showed up three bars (45 minutes) later.
http://www.maoxian.com/images/200609/20060928divx15.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 10:33 am (utc+8) Comments (6)
« Previous Page• Next Page
A Look at RHAT’s After-Hours ActionRHAT blew up after-hours when they reported bad Q2 earnings. It’s easy to see what’s moving after-hours and look for low-risk spots to enter. Do any of you play after-hours action exclusively or know someone who does? It makes sense to me, but the 12-hour time difference makes it impossible for me to consider now.
http://www.maoxian.com/images/200609/20060927rhat15.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 10:26 am (utc+8) Comments (19)
time saved
time saved
Cat:[*]Trading and Investing | Time: 9:45 am (utc+8) Comments (0)
September 27, 2006
Bet the Front-End of the CurveEmpty Nesting / Successful Investing, by Billionaire Gross ($1,200,000,000 and counting)
Gross gives some typically Boomerish (i.e. deeply selfish) parenting advice and sings the praises of the front end of the yield curve:
The art of investing has been obvious for as long as there was money to invest. Identifying winning securities/scenarios, wagering appropriately according to risk/reward, and being able to meld mass/individual psychology into an evolving game plan are the likely keys to the kingdom.
Don’t forget that his monthly Investment Outlooks are written to help meld mass psychology into his evolving game plan, i.e. why is he touting the front end of the yield curve now?
time saved
time saved
Cat:[*]Trading and Investing | Time: 3:23 pm (utc+8) Comments (7)
time saved
time saved
Cat:[*]Trading and Investing | Time: 9:58 am (utc+8) Comments (0)
.”…
“Deeply held beliefs of any kind prevent you from being open to experience, which is why I find all firmly held ideological positions questionable. It makes me nervous when someone believes too deeply or too much. I think that being sceptical and questioning all deeply held beliefs is essential. Of course we must know the difference between scepticism and cynicism because cynicism is as much a restriction of one’s openness to the world as passionate belief is. They are sort of twins. And then in a very real way, solving any problem is more important than being right.”
…
“Some years ago I read a most remarkable thing about love, that also applies to the nature of co-existing with others. It was a quotation from Iris Murdoch in her obituary. It read ‘ Love is the extremely difficult realisation that something other than oneself is real.’ Isn’t that fantastic! The best insight on the subject of love that one can imagine.”
time saved
time saved
Cat:[*]Personal | Time: 10:59 pm (utc+8) Comments (0)
Keeping an Eagle Eye on the Broad Tape and the Importance of the ScratchUglyChart is one of the must-read stock market bloggers because he frequently reports on his day trades in great detail (and those new pop-out charts he uses are funky). In today’s post he writes about two short trades and one long. Before reading his post, I was scrolling through several hundred charts earlier this morning and thought to myself: Any shorts held after 11 AM probably failed.
The interesting thing about his ADM trade is that the set-up bar drew at 11:30 (I time-stamp my bars at the end of the period), long after the broad market action had clearly turned positive. After getting filled short, you would have had over an hour to watch the broad market run further against you before finally getting stopped out in ADM a little after 1 PM.
If there was ever a trade which you had plenty of time to scratch, this was it. No disrespect to my main man Ugly, but playing the short side here was “pissing into the wind.”
http://www.maoxian.com/images/200609/20060925adm30.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 10:26 am (utc+8) Comments (18)
time saved
time saved
Cat:[*]Trading and Investing | Time: 9:23 am (utc+8) Comments (3)
Personal [*]China | Time: 4:28 pm (utc+8) Comments (5)
The Idiocy of Locking Up Content and a $12 Limit Order for NYTI saw that Gretchen Morgenson wrote an article this weekend called “Amaranth fiasco - Echoes of Enron” which I was interested in reading, but when I clicked the link I discovered that it’s walled off — it’s TimesSelect Exclusive Content. I shook my head in disgust and recalled the two posts I wrote almost exactly a year ago: Times DeSelect and All the News(paper) That’s Fit to Short.
NYT is down over 25% since then, and I maintain a BUY order for the stock that I renew every 60 days — my limit price is $12.
http://www.maoxian.com/images/200609/20060922nytw.png
Related: David (Jackson) Versus Goliath
time saved
time saved
Cat:[*]Internet/Media[*]Trading and Investing | Time: 9:13 am (utc+8) Comments (16)
« Previous Page• Next Page
Trend in Long Bond Yield Remains DownYields reversed long before reaching the May 2004 levels that everyone was watching. The bull market in bonds that began in 1982 remains intact.
http://www.maoxian.com/images/200609/20060921tyx.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 10:10 am (utc+8) Comments (1)
Notable New Highs — September 21, 2006Kind of a nowhere morning then selling kicked in around 11:20 AM and continued the rest of the day uninterrupted.
http://www.maoxian.com/images/200609/20060921nnh.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 9:22 am (utc+8) Comments (0)
September 21, 2006
Value Guy Cutting Losses in Old Media InvestmentsThe Olstein Financial Alert Fund, FY Ended June 30, 2006 Report (PDF)
After rigorous team review, old media stocks (Grey Television, Tribune, Gannett, and Journal Register) … were pruned from the portfolio because we believed our assumptions were wrong … The Internet has continued to make rapid inroads into the traditional newspaper industry advertising model, resulting in reduced free cash flow expectations and reduced valuations, and a sell decision with 25% losses since we began buying Tribune, Gannett, Journal Register and Gray Television three years ago. We did not expect the Internet to make such rapid inroads into the stable cash flow models of the old media companies. We were too optimistic in our assumptions regarding the cash flow bases of these older companies.
25% losses, ouch, and think of the opportunity cost of holding those dogs these last three years. One way you can tell a “better value” from a “value trap” is to watch what people under age 25 are doing … you’d be hard-pressed to find a youngster who has ever bought a newspaper. I’m an old fart who reads news constantly — all of it online.
time saved
time saved
Cat:[*]Internet/Media[*]Trading and Investing | Time: 5:48 pm (utc+8) Comments (3)
The Firming of the Software SectorThe Software HOLDRS (SWH) came out in September 1999 near the peak of the Bubble — another instance of Perfect Timing. It then dropped about 80% in the Crash. I think 80% qualifies as a capital “C” Crash. ;-)
The sector has been treading water, relatively speaking, for many years now and just recently began to look a little more interesting.
http://www.maoxian.com/images/200609/20060920swhw.png
Here’s a table which shows where the SWH component stocks stand. Pay special attention to the fifth (% in Yearly Range) and sixth (Year Net %) columns to see what’s strong and what’s weak. Nuance, Openwave and Sapient are names that bring a nostalgic smile to my face and remind me Why HOLDRS Kind of Suck.
http://www.maoxian.com/images/200609/20060920swhcomponents.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 10:11 am (utc+8) Comments (5)
« Previous Page• Next Page
September 20, 2006
A Close Look at YHOO’s CollapseYahoo! did 300,000 trades today which is pretty impressive and made it “front and center” on everyone’s screens. Probably every day trader noticed it within a minute of the break, but then what?
http://www.maoxian.com/images/200609/20060919yhoo5.png
The price broke so hard and the pace was extreme enough to dial down to a one-minute chart. As I’ve detailed in the chart below, there was only one little retrace to act on and you’d have to be quick and good (and lucky) to get a short entry there.
http://www.maoxian.com/images/200609/20060919yhoo1.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 10:22 am (utc+8) Comments (8)
Notable New Highs — September 19, 2006Kind of a flat blah morning but then selling kicked in around 11:30 AM (Yahoo!) and things dropped hard into the early afternoon whereupon action went flat blah again.
http://www.maoxian.com/images/200609/20060919nnh.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 9:48 am (utc+8) Comments (0)
September 19, 2006
Poker Teaches One How To Take RisksInside “Lazy but Smart” Stevie Cohen’s Hidden World, by Susan Pulliam
Bits that stood out to me in this rare profile:
“Mr. Cohen believes that by scrutinizing trading patterns of a stock — by ‘watching the tape’ — it is often possible to predict how the stock will move in the coming hours or even days. For years, he jumped in and out of stocks — sometimes without any knowledge of a company’s fundamentals, or even what it did.”
“Mr. Cohen spends long days at the office in black jeans and worn sweaters, glued to his computer screens as he personally trades upwards of 300 stocks. SAC’s trading floor bombards him with information about what’s going on in the market.”
“SAC pays securities firms an average of one cent for each share it trades, which adds up to more than $400 million in trading commissions each year, making SAC one of Wall Street’s best clients.” [ed. There’s his edge.]
“SAC Capital Management LP, Mr. Cohen’s largest and oldest fund, launched in 1992, has generated an average annual return to investors of 43.5%, after he takes a sizable cut of profits. He and his partners keep 50% of that fund’s gains, along with a 3% annual fee, far more than the 20% and 2% charged by most managers. Mr. Cohen’s net worth is estimated at about $3 billion, which SAC does not dispute.”
“He began playing poker frequently as a high school student, he recalls, and would sometimes arrive home at 6 a.m. after an all-night game … Mr. Cohen excelled in school and at the card table … The summer before his junior year, he quit his job cutting fruit at a local grocer for $1.85 an hour to concentrate on cards. Mr. Cohen says poker ‘taught me how to take risks.’”
time saved
time saved
Cat:[*]Trading and Investing | Time: 9:51 am (utc+8) Comments (1)
A Strong Likelihood that Investors Will Not Receive SquatI was perusing Kirk’s massive daily link dump and saw this article, MotherRock to Holders: Go Pound Salt, which interested me because of this line:
“The rapid collapse of MotherRock is an indication of just how volatile, and costly, trading in the energy markets can be.”
Wrong. The rapid collapse of MotherRock is an indication of what happens when you take hugely leveraged wrong-way bets in a strongly trending market.
http://www.maoxian.com/images/200609/20060918ngpf.png
Related:
Borrowing about $8 for every $1 invested
Brian Hunter: a wunderkind to some, a ticking bomb to others
“What Brian is really, really good at is taking controlled and measured risk.”
Hee Haw.
time saved
time saved
Cat:[*]Trading and Investing | Time: 9:25 am (utc+8) Comments (6)
Notable New Highs — September 18, 2006Decent buying in the morning viciously reversed starting around 13:30 followed by a snapback higher into the close. UglyChart’s intuition was good:
At around 1pm today I closed out everything for a profit because I didn’t like the way things felt.
http://www.maoxian.com/images/200609/20060918nnh.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 8:48 am (utc+8) Comments (10)
September 18, 2006
Market Sentiment, Mixed Signals, and “Ass-perception”On September 5th I wrote that the “S&P 500 Should Pass May High Given Bearish Sentiment,” and I’m still pretty sure it’s going to happen despite the mixed market sentiment.
Let’s walk through the four panels in the chart below. The bottom panel shows the SPY which closed last week at $131.93. The May high was $132.80 so price is only about 0.6% away from a new high. The second panel up with the blue bars is the Volatility Index which is showing optimism and complacency (not a good thing).
The third panel up with the red bars is the ISE Sentiment Index which has stayed very high week after week (people are buying a disproportionate number of put options) and is the main reason I’m so sure new highs are in the cards. The top panel with the black bars is the CDX Index, which I first wrote about here. This too is showing complacency which isn’t good for the bulls.
So it’s a mixed picture, but my ass-perception* is still looking for higher prices.
http://www.maoxian.com/images/200609/20060915sentiment.png
* “Ass-perception,” possessed only by elite professionals, is the process of understanding by which the newly observed qualities of a thing are related to past experience of sitting on one’s ass looking through charts.
time saved
time saved
Cat:[*]Trading and Investing | Time: 10:58 am (utc+8) Comments (6)
time saved
time saved
Cat:[*]Trading and Investing | Time: 5:34 pm (utc+8) Comments (4)
ETF Performance Table — Week Ending September 15, 2006http://www.maoxian.com/images/200609/20060915etf.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 5:21 pm (utc+8) Comments (0)
ETF Performance Table (Int’l) — Week Ending September 15, 2006http://www.maoxian.com/images/200609/20060915etff.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 5:20 pm (utc+8) Comments (0)
« Previous Page• Next Page
September 13, 2006
David (Jackson) Versus GoliathEvery stock market blogger probably knows by now that Yahoo Finance will carry Seeking Alpha articles. That’s good news for Seeking Alpha’s volunteer contributors and even better news for their landlord, David Jackson.
I thought it would be interesting to look at the chart of Dow Jones in light of this news, and the fact that I’m probably not going to renew my subscriptions to both the online WSJ and Barron’s. DJ has been sucking forever and with a downgrade from Lehman Brothers last week it’s flirting with new relative lows. The smart money is long David and short Goliath.
http://www.maoxian.com/images/200609/20060912djm.png
time saved
time saved
Cat:[*]Internet/Media | Time: 10:32 am (utc+8) Comments (14)
Notable New Highs — September 12, 2006The best day I’ve seen since June 29 … strong buying all day which accelerated markedly after 2 PM. Any long day trades put on today were profitable no doubt. It was, what my old friend Jono calls, a “throw a dart” day.
http://www.maoxian.com/images/200609/20060912nnh.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 9:50 am (utc+8) Comments (8)
September 12, 2006
CRB Index Underperformance and Quacking DucksIt’s important to realize that the CRB Index has simply kept up with the S&P 500 since 2003. The CRB modestly outperformed as the tech bubble burst in 2000-2001 and had a short period of sharp outperformance in 2002, but it has been going nowhere, relatively speaking, for years now.
You may recall the excellent commentary by Bill Miller I wrote about back in April. If you haven’t read Miller’s piece yet, there’s still time.
http://www.maoxian.com/images/200609/20060911crbm.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 10:32 am (utc+8) Comments (1)
Notable New Highs — September 11, 2006Modest selling in the morning reversed around noon by some strong buying which fizzled out late in the day.
http://www.maoxian.com/images/200609/20060911nnh.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 9:49 am (utc+8) Comments (0)
September 11, 2006
Interesting Bits in Barron’s — Week of September 11, 2006Here are the few (lightly edited) bits I found interesting in this week’s very weak issue. I’m not sure about re-subscribing to Barron’s when my subscription runs out in late November. I paid the teaser rate of $20 for this past year, which I think is a fair price, and I’m unwilling to pay much more.
“The greatest error made on Wall Street is diversification. Diversification inevitably leads to mediocrity and average performance. If instead you do your research and take valuations very seriously and look at the financial statements and buy stocks that are selling for low multiples, have debt ratios that are not excessive, good growth potential and good profit margins, you’ll be on pretty solid ground … If you look at the overall federal budget and see the huge percentage going to the military and what is left for medical research, education, the environment and housing, you can’t believe it.” — Seth Glickenhaus interviewed by Sandra Ward
“On Sept. 10, 2001, crude oil closed at $27.63 a barrel and gold finished the day at $273 an ounce. Earlier this year oil hit a high near $80, a 189% gain in five years, and gold topped $725, a 166% rise … net new investment in commodities by ‘passive’ investors such as pension funds seeking exposure to the asset class through commodity indexes and derivatives will exceed $110 billion this year. Of that total, $40 billion would be in crude oil and another $28 billion in other energy commodities … At the top of the market in April 2000, Schwab clients had a total of $775 billion in assets and executed a record 386,000 trades per day. In July 2006, Schwab clients had assets of $1.3 trillion — up 68% from the market peak — and placed an average of 245,000 daily trades — down 36%.” — Michael Santoli
“While housing prices appreciated by about 90%, inflation-adjusted, since 1970, the cost of a private college education shot up more than 160% in the same period … Last week, gold fell to $606.20 an ounce, its lowest level in six weeks and crude-oil futures hit a five-month low under $67 barrel.” — Robin Blumenthal
Copyright © 2006 Dow Jones & Company, Inc.
time saved
time saved
Cat:[*]Trading and Investing | Time: 4:08 pm (utc+8) Comments (4)
Reducing Exposure to EnergiesIf you haven’t sold some of the Oil Service HOLDR (OIH) and the Energy SPDR (XLE), you might think about it here. You may recall my June 8, 2006 post, Oil Services Top is Significant and Has Broad Implications, in which I speculated the OIH had topped around $160. I was right about the top but probably got the broader implications wrong — money is just rotating out of the Energies and into beaten down areas like tech, keeping the broad market even.
http://www.maoxian.com/images/200609/20060908oihw.png
The Energy SPDR looks a little better, but I’m going to sell some of this too and rebalance the portfolio a bit. It has had a huge run since late 2003 and it’s time to harvest some gains.
http://www.maoxian.com/images/200609/20060908xlew.png
time saved
time saved
Cat:[*]Energies | Time: 10:11 am (utc+8) Comments (12)
« Previous Page• Next Page
September 7, 2006
Crude Oil Trends Lower Supporting Broad MarketThe price of light, sweet crude peaked in mid-July and its daily trend “officially” reversed exactly a month later in mid-August. The dynamic between the price of oil and stock prices is complex, so it’s simplistic to say lower oil prices = higher stock prices, but I’m a simple guy.
http://www.maoxian.com/images/200609/20060906crude.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 10:34 am (utc+8) Comments (8)
Notable New Highs — September 6, 2006Typical trend day … selling from the get-go which continued all day long. Day traders were exclusively playing the short side (assuming they were sane).
http://www.maoxian.com/images/200609/20060906nnh.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 9:55 am (utc+8) Comments (0)
September 6, 2006
Notable New Highs — September 5, 2006A so-so crummy start to the day reversed around 11 AM… solid buying but not a stampede.
http://www.maoxian.com/images/200609/20060905nnh.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 10:01 am (utc+8) Comments (0)
September 5, 2006
Credit Derivative Index Signaling a Return to ComplacencyI learned about the Dow Jones Credit Derivative Indexes from reading this week’s Barron’s. I immediately recognized their value as a sentiment indicator and have added them to my arsenal. Dow Jones only provides historical data back to April 2005, so if anyone has older data I’d love if you shared it with me.
You can see from the chart below that the investment grade spread (inverted) is returning to the “complacent” edge of the channel which throws my call of the S&P 500 passing the May high in doubt. Darn crosscurrents.
http://www.maoxian.com/images/200609/20060901cdxindex.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 11:16 pm (utc+8) Comments (10)
« Previous Page• Next Page
September 5, 2006
S&P 500 Should Pass May High Given Bearish SentimentThe last six weeks the ISE Sentiment Index has shown a disproportionate number of puts being bought even as the market rises. Since folks are expecting the market to fall, I’m pretty confident the S&P will move above the high reached last May.
See also:June 18, 2006)
http://www.maoxian.com/images/200609/20060901sentiment.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 10:12 am (utc+8) Comments (13)
« Previous Page• Next Page
ETF to Watch — Rydex Russell Top 50 (XLG)I don’t follow the Rydex Russell Top 50 (XLG) that closely since it’s very illiquid, but it’s a pretty interesting ETF:
The investment seeks to replicate as closely as possible, before expenses, the performance of the Russell Top 50 index. The index consists of the common stocks of the 50 largest U.S. companies based on total market capitalization as represented in the Russell 3000 index.
So it holds the 50 biggest of the big cap stocks: Exxon, GE, Citigroup, Bank of America, Microsoft, etc. You can see from the chart below that the XLG began to outperform the S&P500 in late June and it has been a straight shot up since then. It’s pretty easy to see where the institutional money is going if you bother to look.
http://www.maoxian.com/images/200608/20060829xlgw.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 9:57 am (utc+8) Comments (0)
A Nickel for Your ThoughtsThe LME only provides the current year of historical data so I can’t draw a very nice chart, but here’s a look at nickel this year through the end of July along with its warehouse stocks level. Andrea Hotter wrote something I found pretty remarkable in this week’s Barron’s:
To calm prices, the LME allowed shorts, who can’t make physical deliveries, to defer delivery by paying $300/ton a day instead of defaulting, with offsetting longs getting $300/ton as compensation. Concerns over a settlement default drove the LME’s intervention. The LME Chief Executive Simon Heale says with nickel stocks at historically low levels, there is a ‘genuine material shortage. Our first priority is to ensure that trading remains orderly and to prevent the risk of settlement defaults.’”
I wonder if it’s some “rogue” Chinese trader who is short nickel?
http://www.maoxian.com/images/200608/20060825nickel.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 6:44 am (utc+8) Comments (2)
« Previous Page• Next Page
August 25, 2006
Chico’s Outlook Turns a Little Bleak-oChico’s has been a huge winner for many years, but management warned this week that fiscal 2006 earnings would be below expectations. Of course the market anticipated this *months* ago, and everyone paying attention to the charts knew something was wrong back in April.
All serious investors pay close attention to stock charts (especially relative performance charts) because they understand that stock prices reflect all public and non-public information.
http://www.maoxian.com/images/200608/20060824chsm.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 11:05 am (utc+8) Comments (6)
Notable New Highs — August 24, 2006Another nasty, choppy day… big burst of buying around 2 PM though. Money is still flowing into the Staples.
http://www.maoxian.com/images/200608/20060824nnh.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 9:30 am (utc+8) Comments (0)
August 24, 2006
Remembering “Have the Homebuilders Peaked?”It was almost exactly one year ago that I held a chat called Have the Homebuilders Peaked? which happened to have been expertly timed. A few days after that chat Kirk wrote an excellent post about his short position in Dominion Homes. He explained:
“I’m currently short Dominion Homes on the theory that if you can’t make big money in one of the largest booms in history, what are you going to do when the bubble is over? Those of us who saw the last bubble deflate remember that it wasn’t the Ciscos or the Intels of the world the fell the hardest, it was the weakest players in the sector like TheGlobe.coms or InfoSpaces.”
I bring all this up because I noticed DHOM on the new lows list today. I’ve posted two charts below that will interest trend followers. Dominion Homes started to underperform the S&P 500 way back in 2004 and had been sliding for many months before the stronger homebuilders, like Toll Brothers, peaked.
http://www.maoxian.com/images/200608/20060823dhom1.png
If you compare the performance of Dominion to Toll itself, the mid-2004 reversal in DHOM is even more stark. No one in his right mind was looking to get long DHOM in 2005, and the savvy traders were all short — this is the difference between smart and dumb money.
http://www.maoxian.com/images/200608/20060823dhom2.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 9:54 am (utc+8) Comments (7)
Notable New Highs — August 23, 2006Very light trading… things looked so-so positive for about the first hour then headed south and stayed ugly into the close.
http://www.maoxian.com/images/200608/20060823nnh.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 9:07 am (utc+8) Comments (0)
« Previous Page• Next Page
AMD Sets Up for DummiesI thought I’d post my view of it since my charts are prettier than theirs. ;-)
http://www.maoxian.com/images/200608/20060822amd15.png
And here’s the CandleVolume chart, which is probably my favorite charting style of all time — so much information in so little space.
http://www.maoxian.com/images/200608/20060822amd15cv.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 10:50 am (utc+8) Comments (23)
Stock to Watch — ICT Group (ICTG)ICTG moved to a new high on nearly five times average volume after going sideways a good long while. This stock has a six million share float so keep that in mind (be extra careful). I’ve added it to my watchlist
ICT Group, Inc. and its subsidiaries provide outsourced customer management and business process outsourcing solutions. The company offers a mix of sales, service, marketing, and technology solutions, which include customer care/retention, technical support and customer acquisition, and cross-selling/upselling, as well as market research, database marketing, data capture/collection, email management, collections, and other back-office business processing services.
“Upselling,” gack!
http://www.maoxian.com/images/200608/20060817ictgw.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 9:40 am (utc+8) Comments (1)
August 17, 2006
Your 13-Week T-Bill Yield on DrugsAwesome, Dude!
http://www.maoxian.com/images/200608/20060816irxpf.png
time saved
time saved
Cat:[*]Trading and Investing | Time: 10:19 am (utc+8) Comments (2)
« Previous Page• Next Page