Well first off i have the time and secondly its historic times so i am posting often right now.
I added some books and a new blog. My 'to read' list is growing faster than i read.
I like options, but one has to wonder if they will be the undoing of our banks and lenders? I still wonder why some would take a trade which has unlimited risk for only a miniscule payday? Selling naked calls is one such idea.
As i work nights i can only read about are markets after the 'fun' has happened. Would i have had the guts to invest at noon yesterday? Well depends in what i guess, but like several articals i have read said "who's bailing out the fed when its in trouble".
Well i am going to try to get some shut eye. Hope everyone enjoys Friday fun day. Options expiring should only enhance our fun levels. I will update you on what i already know will be dreadful results for my past strategies next weekend.
DH
Friday, September 19, 2008
Thursday, September 18, 2008
My reality TV
Whoo,
more exciting than a roller coaster ride and much easier (yes easier) on my stomach!
This market is exciting (many bad things get your heart racing good or bad) and keeps you on your toes. I wonder who will go bankrupt today?
Another excerpt from an email to a family member who asked if i was watching the markets... LOL.
The actual question
"So...what do you think of the markets this week? Are you watching closely or are you more of a ride out the storm kind of guy? "
My simple answer was Yes to both.
Email quote:
>>>>>>
I lost over $5k today in my investment account. Very sad now as i doubt that i have a good shot at winning this contest! What and you thought i was talking about real money?? lol.
In my real investment play account i am down this week $500-$1000. Not good, but not as bad as most. I am also 40% cash and have been most of this year waiting for this sort of melt down.
My RRSP is down worse. I am fully invested right now (i had a little money in cash that i invested Monday morning>>>> whoops.
In answer to your questions yes to both. I am in a good position. Sure if the markets continue to fall it looks bad, but i have many years at which i am adding money at these lower levels. My match RRSP at work adds 18% of our salary yearly and it goes up as our pay does.
I am also adding to RESP's and a cash (emergency account). If interest rates rise these may be reduced or suspended to pay additional interest.
The wife is mad at me (she has reason). I am watching the market fervently. I entered a contest this week and stuff has sold off big time everywhere. Regardless of that when large firms like Merril Lynch and AIG are going under simultaneously we are watching history. So i am riveted by the markets right now although i am doing little with any real investments (I thought about buying some silver companies today). This stuff is my reality TV.
I love how the US government bails out any and all comers. Wanna invest like a fool with Billions of other peoples money and get paid oodles. Then when you screw up and lose MORE than everything no worries THE FED will bail your 'dumb ass' out. What about those peoples money you lost? Sorry SOL.
I can only hope that lots of financial people go to jail and pay back all those bonuses when they made 'pretend' money.
Due to our dollar erosion i think your US fund should be ok (by ok i mean not the worst performer and you shouldn't lose 'all' your money like some).
Imagine some people who borrowed to invest in companies and lost? Like that oil company i bought yesterday in my 'game' account. It fell almost 50% today.... and that was after falling 50% ytd. (no its not 0 now, but -75% ytd). Hmmm.
People like Sis and others younger stand to benefit from this 'healthy' correction since the market was over extended before. Now when she invests in the coming years the market will be 'on sale'.
'Don't panic, Don't use leverage, and stay the course'. A mix of advice from people smarter than i.
<<<<<< end email.
As you can imagine i have done nothing with options. Premiums are through the roof. Spreads are absurdly large. It really makes them tough to use. That said Selling puts on CDE at $5 strike a few months out might work. I wonder if just buying the shares would be easier however due to the large spreads.
Enjoy the show!
DH
more exciting than a roller coaster ride and much easier (yes easier) on my stomach!
This market is exciting (many bad things get your heart racing good or bad) and keeps you on your toes. I wonder who will go bankrupt today?
Another excerpt from an email to a family member who asked if i was watching the markets... LOL.
The actual question
"So...what do you think of the markets this week? Are you watching closely or are you more of a ride out the storm kind of guy? "
My simple answer was Yes to both.
Email quote:
>>>>>>
I lost over $5k today in my investment account. Very sad now as i doubt that i have a good shot at winning this contest! What and you thought i was talking about real money?? lol.
In my real investment play account i am down this week $500-$1000. Not good, but not as bad as most. I am also 40% cash and have been most of this year waiting for this sort of melt down.
My RRSP is down worse. I am fully invested right now (i had a little money in cash that i invested Monday morning>>>> whoops.
In answer to your questions yes to both. I am in a good position. Sure if the markets continue to fall it looks bad, but i have many years at which i am adding money at these lower levels. My match RRSP at work adds 18% of our salary yearly and it goes up as our pay does.
I am also adding to RESP's and a cash (emergency account). If interest rates rise these may be reduced or suspended to pay additional interest.
The wife is mad at me (she has reason). I am watching the market fervently. I entered a contest this week and stuff has sold off big time everywhere. Regardless of that when large firms like Merril Lynch and AIG are going under simultaneously we are watching history. So i am riveted by the markets right now although i am doing little with any real investments (I thought about buying some silver companies today). This stuff is my reality TV.
I love how the US government bails out any and all comers. Wanna invest like a fool with Billions of other peoples money and get paid oodles. Then when you screw up and lose MORE than everything no worries THE FED will bail your 'dumb ass' out. What about those peoples money you lost? Sorry SOL.
I can only hope that lots of financial people go to jail and pay back all those bonuses when they made 'pretend' money.
Due to our dollar erosion i think your US fund should be ok (by ok i mean not the worst performer and you shouldn't lose 'all' your money like some).
Imagine some people who borrowed to invest in companies and lost? Like that oil company i bought yesterday in my 'game' account. It fell almost 50% today.... and that was after falling 50% ytd. (no its not 0 now, but -75% ytd). Hmmm.
People like Sis and others younger stand to benefit from this 'healthy' correction since the market was over extended before. Now when she invests in the coming years the market will be 'on sale'.
'Don't panic, Don't use leverage, and stay the course'. A mix of advice from people smarter than i.
<<<<<< end email.
As you can imagine i have done nothing with options. Premiums are through the roof. Spreads are absurdly large. It really makes them tough to use. That said Selling puts on CDE at $5 strike a few months out might work. I wonder if just buying the shares would be easier however due to the large spreads.
Enjoy the show!
DH
Sunday, September 14, 2008
Risk aversion
'Danger Will Rogers'
while i can't remember where this saying came from it sums up what i think of the markets right now and short term.
An excerpt of a recent email i sent to a friend for your amusment:
>>>>>
Wow that was funny. Its nice when you pay for subscriptions to things that people don't know answers too! He does have some good points, but at least he admitted nobody really knows what the market will do. I agree with most of what he said. Part of the reason i haven't bought into the 'all commodities' portfolio was because of what he said. Too many fools on margin bidding it up too high and then forced into selling.
I adapted my 'sell down to the sleep level' a few years ago. While i still may use small bits of leverage here and there with my margin account or using the dreaded derivates in small doses. I have foolishly not followed my own advice to myself last summer and start buying some puts here and there. My account has been 30%+ cash for all of '08 and as the markets drift down i haven't bought a call option in months. I in fact love the possibilities of derivates (both long and short)... if used correctly and in moderation. Who knew?
I am really shaking my head on U stocks far more than any other commodity. Ag's are still high, golds so so, silver is better, but U's have been slaughtered and are probably the most useful of the bunch. The U price has been stable too; unlike gold, oil, corn, whatever, etc. As forced selling continues i still like buying railways, and JNJ or Proctor Gamble style companies over gold/silver (for the most part and long term).
I have to wonder how much more US financials and companies will fall before they enter the bargin bin or the Fannie/Freddie sin bin. Is AIG heading down the same Goldman Sachs road? I have tried to find 'the best' US financials and only 2 so far make me modestly comfortable: BBT and WFC. I think as BAC buys more companies it may be hurt as the unwinding continues.. '
<<<<<<<<<<
I wrote a few more paragraphs, but none of it really matters here. My point it that if i were a true gambler i would be buying large amounts of call options on CCO, PDN, DML. As these free fall due to 'margin call' forced selling at this level of baby bathwater has never been so enticing?!
With oil falling down and gas in the tank scarce do refiners like SUN-N and VLO-N stand to profit? Squeezed to death by record oil prices these guys have old refineries, but we have nothing to replace them? I think railways fit into the almost perfect moats too as gas/diesel prices rise.
Well one thing i can tell you for certain, my advice is worth what you paid for it!
DH
while i can't remember where this saying came from it sums up what i think of the markets right now and short term.
An excerpt of a recent email i sent to a friend for your amusment:
>>>>>
Wow that was funny. Its nice when you pay for subscriptions to things that people don't know answers too! He does have some good points, but at least he admitted nobody really knows what the market will do. I agree with most of what he said. Part of the reason i haven't bought into the 'all commodities' portfolio was because of what he said. Too many fools on margin bidding it up too high and then forced into selling.
I adapted my 'sell down to the sleep level' a few years ago. While i still may use small bits of leverage here and there with my margin account or using the dreaded derivates in small doses. I have foolishly not followed my own advice to myself last summer and start buying some puts here and there. My account has been 30%+ cash for all of '08 and as the markets drift down i haven't bought a call option in months. I in fact love the possibilities of derivates (both long and short)... if used correctly and in moderation. Who knew?
I am really shaking my head on U stocks far more than any other commodity. Ag's are still high, golds so so, silver is better, but U's have been slaughtered and are probably the most useful of the bunch. The U price has been stable too; unlike gold, oil, corn, whatever, etc. As forced selling continues i still like buying railways, and JNJ or Proctor Gamble style companies over gold/silver (for the most part and long term).
I have to wonder how much more US financials and companies will fall before they enter the bargin bin or the Fannie/Freddie sin bin. Is AIG heading down the same Goldman Sachs road? I have tried to find 'the best' US financials and only 2 so far make me modestly comfortable: BBT and WFC. I think as BAC buys more companies it may be hurt as the unwinding continues.. '
<<<<<<<<<<
I wrote a few more paragraphs, but none of it really matters here. My point it that if i were a true gambler i would be buying large amounts of call options on CCO, PDN, DML. As these free fall due to 'margin call' forced selling at this level of baby bathwater has never been so enticing?!
With oil falling down and gas in the tank scarce do refiners like SUN-N and VLO-N stand to profit? Squeezed to death by record oil prices these guys have old refineries, but we have nothing to replace them? I think railways fit into the almost perfect moats too as gas/diesel prices rise.
Well one thing i can tell you for certain, my advice is worth what you paid for it!
DH
Subscribe to:
Posts (Atom)
