It may seem to some that taking advantage of a crisis and profiting from it would be underhanded or lacking moral integrity, but from a trader’s point of view, nothing could be farther from the truth. The desire to make a profit is the grease that makes the wheel turn and the sole purpose free markets exist at all. Once you have accomplished that not so small feat of making a winning trade, you can donate some of your profits to charity if that will help you sleep at night.
Entries under the ‘Options Investing’ Category
Contrarian Investing – Profiting from Crisis
On January - 14 - 2010
Hard to be Optimistic / Top Picks
On December - 3 - 2009
Fannie Mae drops another bomb. The GSE (government sponsored enterprise) announced a $19 billion loss for the third quarter which brings it’s current loss to $101 billion (8 year total loss). Thankfully, the U.S. Treasury is waiting in the wings with another $200 billion taxpayer bailout of this miserable excuse for a company. Fannie now wants another $15 billion in emergency funds (it’s 4th withdrawal this year) bringing it’s annual total to $60 billion YTD (so far).
If Fannie ever actually earns a profit, the $6 billion it owes the guv’ment in annual dividends would swallow it whole. Fact is, Fannie Mae and Freddie Mac are completely dependent on the Treasury to support their continued operations.
The Dollar and the Stock Market
On November - 5 - 2009
On 10/29 our Newmont Mining, November puts were sold for a 130% profit in 2 days. Since I had no idea if anyone was on the trade I didn’t update it sooner. November options had very little time left so I assumed anyone on the trade would have closed it being up better than 100%. If you missed that, the following Friday it was back up 70% giving two chances to close out with a solid profit. I closed @ 120%.
Couer D’Alene had an amazing 3Q with an 86% increase in silver production to 5.2 million ounces, 222% increase in gold production to 29K ounces and a 146% increase in revenue to an all time high of $90 million. The stock price is up 150% YTD.
Question From An Options Trader
On June - 11 - 2009
Thanks for the lesson, quite impressive for a “techie”!! By the way it appears you have done well with CVI. On your advice I picked 200 shares at 8.18, closed yesterday at 10.00, not bad for 2 days! I notice it’s ROE is 32%, with so many different fundamental indicators it is beneficial to know that you put special emphasis on ROE.
The Most Reliable Indicator for Choosing Winning Stocks
On June - 4 - 2009
It may sound funny that here I am, the self admitted “technical” trader, about to tell you about a “fundamental” indicator for picking consistently, outperforming stocks. If an investor were to only use this one stock selecting tool and nothing else, the returns would be an unbelievable string of winners.
A little bit of math and a small amount of research and the winning trades would blow your mind. But, therein lies the problem. Tell the average investor that there’s a way to consistently beat the markets and you’ve got their full attention… then you tell them there are some simple mathematical calculations and their vision starts to blur and they can’t hearrrrrr you because of the ringing in their ears.
