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My Stock Value Strategy Starts Now (2 Viewers)

Mark Davis said:
Keerock said:
Mark Davis said:
Down to the wire here on my GE put options I wrote for February with a strike of 10. They are only about a nickel out of the money now. I am kind of pulling for those to execute so I can hold that one and write some covered calls while possibly collecting some dividends.
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:whoosh:
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I wrote put options on GE that expire in February. Basically I committed to buying GE for $10/share on February's options expiration, which is the end of trading tomorrow. Obviously if the price was over $10 then the option wouldn't execute. If it's under $10 then I buy 100 shares per contract I wrote at $10. For that promise I made earlier, I was paid about $.65/share. So if it executes, my cost is around $9.35 ($10 purchase price - $.65 collected on each share by writing the put option).I'm saying at that price I like owning some GE. To further reduce cost I can then write" covered" call contracts for say a strike of $10 or $11/share. By covered I mean if I own 500 shares I can write 5 call contracts, which are promises to sell at a certain price. I'll get paid a premium for that as well. If GE rises above the strike price then I have a tidy 10-20% gain in a couple of months. If it doesn't, again my cost is below $9/share and I rinse and repeat to reduce costs even further.
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I wouldn't touch GE right now unless I had extremely tight stops in place. It's really a "financial" in drag.
 
David Dodds said:
Been a painful few weeks for me here. I set a stop loss on EXM at 6.25 and it was triggered. My ESEA also was triggered at 4.80 Ouch. The fact that both are even lower though makes this kind of feel right. The BDI is back up at 2,000+ though so I still expect a big rally on these shippers by May/June. I will likely try and add EXM soon as it feels like it is approaching a bottom. Going to watch the shorting action and try and time the rally. I added 2,000 UCO yesterday (once at 5.95 and another at 5.85) on a hunch that the inventory report can't be much worse than expected.

I am officially all in on oil as I ever want to be.

Realized Losses last few days = 5,726

Year to date profit = $11,839

sold 1,000 shares of ESEA - Lost $690 +12

sold 2,500 EXM - Lost $5,000 + 24

I now hold these positions:

9,000 shares of UCO @ $8.08

3,000 shares of SBLK @ $3.04 (too stubborn to set a stop loss...lol)

I stopped trying to figure what I am down regarding UCO and SBLK, but it is substantial. I do not plan on selling at a loss though. I may have to wait for a war for oil to rebound.
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I got a Sack Boy gram... SB misses trading with you guys :pickle: but made boatloads with SKF and SRS thanks to spidey.
 
David Dodds said:
Added 2,000 shares of FAS at 4.35. Not sure what I want to sell this at as it's rising fast.
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Damn, almost pulled the trigger to be out at 4.70. Have set stop loss at 3.95 (at 4.32 right now) and also have a limit sell order in at 4.70. Financials are really getting slain right now. This should have been an easy daytrade and now maybe not.
 
and out of FAS at 4.45. Although I think it's way undervalued, I don't want to hold through the weekend and about to be out for a bit. Profit = $200 -$12 commissions.

 
David Dodds said:
and out of FAS at 4.45. Although I think it's way undervalued, I don't want to hold through the weekend and about to be out for a bit. Profit = $200 -$12 commissions.
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Wow I can't suck much worse than this. Stock hits $5.19 while I am out. I just was not sure I would be back before the market close and I knew I absolutely did not want to hold this through the weekend.
 
David Dodds said:
David Dodds said:
and out of FAS at 4.45. Although I think it's way undervalued, I don't want to hold through the weekend and about to be out for a bit. Profit = $200 -$12 commissions.
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Wow I can't suck much worse than this. Stock hits $5.19 while I am out. I just was not sure I would be back before the market close and I knew I absolutely did not want to hold this through the weekend.
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I nailed FAS beautifully today on the first time I've actively day traded since mid December. It seemed too ripe to pass on, but it also seemed very obvious to be patient in the morning. I set the buy limit at 3.95 when I saw your stop, then set a 20% trailing stop beneath it and a 5.15 sell (which I figured was a lock in the next couple trading days). I got busy and the whole thing executed while I wasn't paying attention. Fun.
 
Very interesting where the contango is right now regarding oil contracts:

April: 40.08

May: 42.04 (+1.96) - UCO/SCO tracks this

June: 43.34 (+1.30)

July 44.51 (+1.17) - DXO/DTO tracks this

Aug 45.73 (+1.22)

There used to be a $12 gap from the leading contract to the end contract. It has now contracted to $5.65. When the contango gap was approximately $12, the spread looked like this (+5.5, +3.5, +1.75, +1.25). I am still of the opinion that this gap will widen in the coming month here as inventory concerns are replaced with OPEC cuts and tension in the world.

 
Year to date profit = $12,027

Today

sold 1,000 shares of FAS - Profit = $200 - $12 = $188

There was a ton of money to be made day-trading today with the financials, shipping and oil sectors. But with the market imploding, I prefer waiting until next week to try some of those moves.

I now hold these positions (all but DXO at big losses unfortunately):

9,000 shares of UCO @ $8.08

3,000 shares of SBLK @ $3.04

4,000 shares of DXO @ $1.94

I think we could see a good oil rally early in the week. If it happens, I will likely lessen my position here and jump back in the Dry Shipping Stocks (that have been badly beaten down despite the BDI increasing).

 
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Today I established a position in RIMM - Research in Motion (maker of the blackberry) at a cost of $38.72 per share. I think anything under $40 is a real bargain. There's a lot of chatter in the tech world about coming mergers and acquisitions and RIMM is prominent in those discussions. Even without a near-term acquisition, I think current prices are very attractive.

 
The Z Machine said:
SBLK is in the toilet. What happened to this sector?
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When the BDI completely collapsed there was no way to be certain the market fully priced in the economic damage done to dry shipping by the deeeeep cliff dive. So current advances in the BDI don't guarantee a recovery in the stocks. This industry is seriously scrambling to stay afloat. The contract/price decline was un be lieve able. These little BDI gains mostly reflect China restocking raw materials. That process is complete, as I understand it. NM is my favorite dry shipper because they have the liquidity to pay their bills through just about any scenario. EXM, DRYS, others, not so much. Those are heavily leveraged, which could be more profitable in a current bull market, but the risk is higher and this is a bear. With the dow sitting on historic lows, I see no reason why the shippers aren't doing the same. If you look at their 52 week lows, you'll see most currently anywhere from 20-50% higher today. This is a great sector for writing puts if you really want some. :unsure:
 
The Z Machine said:
SBLK is in the toilet. What happened to this sector?
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The BDI sucked for quite awhile so a lot of these companies bled money from November until recently. Most are heavily leveraged with debt (buying ships costs money). And with the economy hurting, many of the companies that had long-term contracts forced the shippers to renegotiate to lower prices (based on a crushed BDI). This has killed earnings this cycle and led to a lot of the companies suspending their dividends. But the reality is these companies are trading at ridiculously low P/E and the BDI is at year's high (rose last 3 days after a two day drop...and rose 14 days before that). May/June is usually when these companies are their busiest too so these prices are beyond ridiculous in my eyes. DSX just reported their earnings and it beat estimates and the stock still got hammered today. And they have little to no debt and could gobble up other companies in this space should they decide to do that.These stocks will jump on days when NASDAQ is up and BDI is up. All this week the NASDAQ has traded lower. If the world economies recover this year, I believe you will see the bounce the hardest and first in this sector. I am looking to add SBLK shares or SEA (the ETN for this sector) early next week and hold through May. This feels like a bottom to me.
 
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David Dodds said:
David Dodds said:
and out of FAS at 4.45. Although I think it's way undervalued, I don't want to hold through the weekend and about to be out for a bit. Profit = $200 -$12 commissions.
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Wow I can't suck much worse than this. Stock hits $5.19 while I am out. I just was not sure I would be back before the market close and I knew I absolutely did not want to hold this through the weekend.
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:confused:
 
David Dodds said:
Very interesting where the contango is right now regarding oil contracts:April: 40.08May: 42.04 (+1.96) - UCO/SCO tracks thisJune: 43.34 (+1.30)July 44.51 (+1.17) - DXO/DTO tracks thisAug 45.73 (+1.22)There used to be a $12 gap from the leading contract to the end contract. It has now contracted to $5.65. When the contango gap was approximately $12, the spread looked like this (+5.5, +3.5, +1.75, +1.25). I am still of the opinion that this gap will widen in the coming month here as inventory concerns are replaced with OPEC cuts and tension in the world.
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If you believe contango will become more severe, then you definitely don't want to be long any of these oil ETFs that are forced to continually roll their contracts. If you must, then USL is the one to own because it holds futures contracts spread over the next 12 months, thus minimizing costs associated with contango.The time to be long oil is when contango comes out of the market (unless of course you own physical oil with long-dated futures sold against it). The spread does not in any way indicate where oil prices will be tomorrow, in a month, or in 12 months.Also, OPEC cuts have not had any material impact on oil prices for years. OPEC members constantly cheat one another and rarely stick to their quotas. War, on the other hand, is a different story. If Russia's situation continues to deteriorate, look for them to increase tension around the globe, as a means of getting oil prices up, and increasing petrodollar flows into the country.
 
OneEastRiver said:
David Dodds said:
Very interesting where the contango is right now regarding oil contracts:April: 40.08May: 42.04 (+1.96) - UCO/SCO tracks thisJune: 43.34 (+1.30)July 44.51 (+1.17) - DXO/DTO tracks thisAug 45.73 (+1.22)There used to be a $12 gap from the leading contract to the end contract. It has now contracted to $5.65. When the contango gap was approximately $12, the spread looked like this (+5.5, +3.5, +1.75, +1.25). I am still of the opinion that this gap will widen in the coming month here as inventory concerns are replaced with OPEC cuts and tension in the world.
Click to expand...
If you believe contango will become more severe, then you definitely don't want to be long any of these oil ETFs that are forced to continually roll their contracts. If you must, then USL is the one to own because it holds futures contracts spread over the next 12 months, thus minimizing costs associated with contango.The time to be long oil is when contango comes out of the market (unless of course you own physical oil with long-dated futures sold against it). The spread does not in any way indicate where oil prices will be tomorrow, in a month, or in 12 months.Also, OPEC cuts have not had any material impact on oil prices for years. OPEC members constantly cheat one another and rarely stick to their quotas. War, on the other hand, is a different story. If Russia's situation continues to deteriorate, look for them to increase tension around the globe, as a means of getting oil prices up, and increasing petrodollar flows into the country.
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This doesn't sound good for UCO holders like me then...
 
I bought some BAC at 4.14 today. I had a talk with a very smart and dialed in friend last night who is convinced nationalization is off the table.

 
My limit on DXO was hit while I was sleeping for a decent little profit of 18 cents a share. Profit = 4,000 shares x .18 = $720 - $12. This could go higher, but I am happy to just bank this win for now. With the NASDAQ off again, I want to be in position to grab some low hanging fruit here soon.

I may even start dropping some UCO at a loss to start lessening my exposure here.

 
Mark Davis said:
Anyone up for getting a squares game together for the date when the Dow hits 5500?
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I think it's going down, but probably not that far. Just read today that if you would take to zero GE, Alcoa, GM, BOA, and Citigroup, the Dow would drop only 2.8%. The Dow Jones folks have thus far refrained on removing sub $10 per share companies from the index (as they have done in the past). As such, the index is distorted.So, yes folks, things are actually much worse the the DJIA is letting on!
 
added 2,000 shares of EXM at 3.60. Their CEO was canned today so not sure this is even the bottom, but I don't see this company going down the drain. I set a stop loss at 3.25 and a sell at 4.25.

 
Added 4,000 shares of DXO at $1.88. This feels very safe. I have set stops on the low side at 1.70 and a sell at the high end at 2.00. I also plan to sell before the inventory report should this go lower today.

 
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When will the stress test for the banks start and what is the shark move, Dodds?

 
David Dodds said:
Added 4,000 shares of DXO at $1.88. This feels very safe. I have set stops on the low side at 1.70 and a sell at the high end at 2.00. I also plan to sell before the inventory report should this go lower today.
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and out of DXO at 2.03 with a great opening bell. Profit = 15 cents x 4,000 shares = $600 - $12 commissions
 
David Dodds said:
Woozy Foozy said:
When will the stress test for the banks start and what is the shark move, Dodds?
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To me it seems like the whole financial sector has been ravaged way more than seems right. I think FAS and UYG (the leveraged ETFs) feel right at these levels.
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:thumbup:on a side note, Cramu was really railing against these last night...AGAIN. Saying they should not be allowed. Total buy signal.
 
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Had a great day in the market today. I did not sell anything except the DXO, but oil ended on a nice note and the shipping sector had a huge rebound as well (EXM was up double digits). I may lessen my oil position considerably based on the inventory report tomorrow.

I wished I would have followed my own advice regarding FAS which had a 20+% gain today as well. I will recap where I am later tonight. Another good day for oil / shipping tomorrow and I may soon get very active again with my trades.

 
Year to date profit = $13,323

I now hold these positions (unrealized gains and losses):

9,000 shares of UCO @ $8.08 (current loss of $12,420)

3,000 shares of SBLK @ $3.04 (current loss of $4,590)

2,000 shares of EXM @ $3.60 (current profit if sold now = $1,240)

Today was solid to getting me closer to even. Am hopeful on a great inventory report, but that might be more wishful thinking here. From a maneuvering standpoint though I might be better off selling the oil stocks if they get much higher so I can get more dollars in play on the dips.

 
the EIA report is mostly good news:

Summary of Weekly Petroleum Data for the Week Ending February 20, 2009

U.S. crude oil refinery inputs averaged 13.9 million barrels per day during the

week ending February 20, down 207 thousand barrels per day from the previous

week's average. Refineries operated at 81.4 percent of their operable capacity

last week. Gasoline production rose last week, averaging 8.9 million barrels per

day. Distillate fuel production increased slightly last week, averaging 4.2

million barrels per day.

U.S. crude oil imports averaged nearly 8.8 million barrels per day last week,

down 24 thousand barrels per day from the previous week. Over the last four

weeks, crude oil imports have averaged 9.3 million barrels per day, 420 thousand

barrels per day below the same four-week period last year. Total motor gasoline

imports (including both finished gasoline and gasoline blending components) last

week averaged 805 thousand barrels per day. Distillate fuel imports averaged 282

thousand barrels per day last week.

U.S. commercial crude oil inventories (excluding those in the Strategic

Petroleum Reserve) increased 0.7 million barrels from the previous week. At

351.3 million barrels, U.S. crude oil inventories are above the upper limit of

the average range for this time of year. Total motor gasoline inventories

decreased by 3.4 million barrels last week, and are in the lower half of the

average range. Both finished gasoline inventories and gasoline blending

components inventories decreased last week. Distillate fuel inventories

increased by 0.8 million barrels, and are above the upper limit of the average

range for this time of year. Propane/propylene inventories decreased last week

by 0.6 million barrels and are above the upper limit of the average range. Total

commercial petroleum inventories decreased by 2.9 million barrels last week and

are above the upper limit of average range for this time of year.

Total products supplied over the last four-week period as averaged 19.7 million

barrels per day, down by 0.8 percent compared to the similar period last year.

Over the last four weeks, motor gasoline demand has averaged about 9.0 million

barrels per day, up by 1.7 percent from the same period last year. Distillate

fuel demand has averaged about 4.2 million barrels per day over the last four

weeks, down by 1.6 percent from the same period last year. Jet fuel demand is

15.4 percent lower over the last four weeks compared to the same four-week

period last year.

 
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A post from Google Message Board that I mostly agree with regarding what this inventory report means:

Looking forward:

-gasoline inventory is down 3.4 million barrels. That means more

crude demand is coming in the next couple weeks. "bullish"

-"motor gasoline demand has averaged about 9.0 million barrels per

day, up by 1.7 percent from the same period last year." That

indicates that people in the US are back to their old driving habits

and even more gasoline demand is on the way.

-Refineries operated at 81.4 percent of their operable capacity last

week. This number is usually around 90%. Thus 9% of refinery capacity

is still down for maintenance. As that comes back, more crude demand

is coming

-The amount of crude imports are also slowly declining which is going

to help Cushing draw down on its stockpile.

All of this signals a slow but steady turn in the supply/demand

picture for crude, and is a bullish signal.

 
I sold 2,000 shares of UCO today at $7.25 (in at an average cost of $8.08). I suffer a loss on these shares, but like the fact that this is up big the last two days. This helps me to free up more money to buy shipping or oil on the dips.

 
sold another 2,000 UCO at $7.42 here. Hoping to get back into this on a dip. Dry shipping starting to rebound now that that the markets are headed up. I likely will sell right at the market close for a gain.

 
Sold 2,000 shares of EXM at 3.92 for a profit. Should have moved out yesterday, but glad to see it recover from earlier low. Profit = $640 - 12 = $628.

Very very pleased today to lessen my UCO holdings as well.

 
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