Brazil slammed at Ibovespa open. Scaling back into EWZ
(Brazil) @ 38.05 (-4% discount to Thursday's close) and PBR (Petrobras) @ 9.48
(-7% discount to Thursday's close). Both now closing in on or printing new 52-wk lows.
RSX (Russia) on the watchlist, as are CAF and EEM (heading into Monday's open of the Shanghai-Hong Kong Connect).
Is pbr gonna bring down that country and cause a mkt panic?
ReplyDeleteBB....some food for thought re: DB
ReplyDeletehttp://ibankcoin.com/bluestar/2014/11/14/is-deutsche-bank-is-holding-the-old-maid/
I have no idea what's hidden inside that bank, but the continued weakness of late has been notable.
Almost as if expectation is low, that Germany will come to the rescue.
DeleteGood call though, I was thinking it might bottom around $28.8x
DeleteEWZ off @ 38.74 (+1.8%). PBR off @ 9.67 (+2%).
ReplyDeleteBXE - For some reason this one has been performing beyond my expectation, recently.
ReplyDeleteJust goes to show, you never really know why a stock goes up or down.
DeleteNot just that, but I can't blame my bad entry on BXE.
DeleteMark, looks like you've got some nice places to cycle around there. Nice not having to worry about cars and looks like nice views.
ReplyDeleteCP,
ReplyDeleteI think with TCK, you have to think about how the coal market does. Personally I'd stay away as I think coal; still have a ways to go on the downside due to less China demand due to less steel production and pollution concerns. If I wanted to go into metals, I'd look at a copper or zinc miner, both metals have better outlooks.
Yeah, more of a rhetorical question I suppose. I do like the idea of zinc though, always liked that metal and was one reason I was interested in silver. But silver is in overproduction, thus zinc as well?
DeleteBrad, you still holding DB? I am and I think it does OK, but it is a risky one. From a "what we know" perspective, I think it does well, but the real risks are that there are things in here that come back to bite us as that author suggests.
ReplyDeletePart of my faith is based on the fact that they've raised capital twice. So the first time you can understand given the financial crisis, but you would think they would have made sure they got enough. The second time they said they didn't need to, but since they did it, you think the CEO would have been reading the riot act to his team to make sure that for sure this was the last time or he would almost certainly lose his job.
I've been trading it recently...buying on dips and selling the rips. Agree re: riot act, but I don't like the way it's been acting and I think there may be an opportunity to get it lower. Frankly, I have more confidence in ING than DB, but I don't want to be overconcentrated in one stock, hence my interest in DB. I still have some shares, but not many.
DeleteBrad, what's your assessment of Europe, are things looking up or deteriorating?
DeleteKind of wondering if ECB QE might not actually lift the Euro... Given that should instill confidence, and the $USD is nearing the upper limit of it's 10 year+ channel.
ReplyDeleteCAF @ 25.39.
ReplyDeleteReopened EWZ @ 38.79.
Reopened PBR @ 9.54.
Closing RYTPX (Rydex 2x Inverse SPX) @ the 1030 est window for what will likely be a minor loss.
Opening RYWVX (Rydex 2x Emerging Markets) @ the 1030 window.
RSX @ 20.39.
DeleteWith the exception of India, now BRIC'd.
SPWR had a nice little bounce yesterday. Gone now.
ReplyDeleteDB - One thing about this one that gnaws at me a little is it seems to be going through a soft landing as opposed to shoe-drop waterfalls.
ReplyDeleteOverall, the market seems quite positive and my fears have receded, doesn't feel like the calm before the storm, either. On top of that, my least favorite blogger is very negative despite still being long (no doubt he doesn't do as he says) b/c he's the greatest human to walk the face of the earth.
Brad, I agree with your assessment of ING versus DB.
ReplyDeleteDB price now at the place it bottomed in 2011 and 2012, so would be a logical place for it to do so again, but we'll see.
Morningstar has a fair value of $42 per ADR from $44 as we update the exchange rate. Our fair value estimate is about 0.7 times book value and 0.9 times tangible book value as of third-quarter 2014. So no outrageous expectations there and if things get better, could be much higher.
I think DB gets support too from the fact that the Europeans don't want all investment banking from US companies and DB is the Euro leader.
What's making PM's/GDX etc. pop?
ReplyDeleteI think it's probably this:
Deletehttp://content.screencast.com/users/springheel_jack/folders/1411/media/b1b40d29-21c5-42b2-862c-38d270bc7287/141104%20USD%20Monthly%20Declining%20Resistance%20Broken.png
"Chart Talk: Decennial Pattern: Years ending in “5” are strong
ReplyDeleteNovember 13, 2014
Decennial Pattern: Year 5 is strongest year of decade. Average Year 5 returns: S&P 500: 25.3% & DJIA: 28.9%. Decennial Pattern & Presidential Cycle aligned & bullish. This bodes well for year-end 2014 and 2015. Stock charts: 90-day breakouts: GRPN, HNT, HRC, LBTYA, ODP & RHI. 90-day breakdowns: ICA."
I've been thinking about getting long the EuroStoxx 50. With the ECB undertaking a QE program, I think that the baton is getting passed to Europe. If the effect is similar to what happened in the US, we should see European markets get pushed up. However, seems like we have some weakness here that may offer a buying opp.
ReplyDeleteDB may be bottoming here. Tough call.
Guys take a look at the move in the Euro. This is bottoming in my opinion. I need to look a little more closer at this but the overnight move and now back to flat after a big move down tells me there are buyers here. This is very important for European securities in my opinion. Especially ADRs.
ReplyDeleteCP...regarding Europe. I live in Spain and for a lot of people things have been bad for a while. You either have a job or you don't. Younger people have been immigrating to other, stronger European countries (Germany, UK, Denmark, etc...) to find work. That said, nearly everyone I know has work. The problem in Spain is the salaries, which are quite low relative to the rest of Europe.
ReplyDeleteI live in Barcelona and frankly, it's a booming city. Tons of tourists and a good economy overall, especially compared to the rest of Spain. The number of hotels seems like it has doubled in 10 years and there are now tons of new restaurants, many of which are quite good.
In the end, I think we are witnessing a global transformation. There are winners and losers and this is happening everywhere and I think it will continue to accelerate. People in "knowledge" industries---high-tech, medicine, etc.--- will do well relative to other industries.
Wow, that's the beauty of blogging. I had no idea you resided in Barcelona. One younger brother (the one who works in HK) often vacations in Spain, and has nothing but good things to say about his visits.
DeleteI like Europe a lot. But I avoid Germany and France, LOL.
DeleteI have a high school friend that has worked for the IB division in DB for 7 or so years. I should ask him for more insight. From what I remember the culture there sucked. But its trading at 1/2 the p/b that MS is so there has to be some mean reversion I would think. For ING - The one concern I have is I believe they sold their ING Direct division to Capital One. Before I started investing our excess cash for my business I was using that for everything and I know a lot of people were. Even today when I look around they (Capital One 360) offer the best rates on money market type accounts.
ReplyDeleteI want to get long DB, have been resisting the urge and meanwhile the urge is growing.
DeleteGreat place to live. Nice people, good life-style.
ReplyDeleteThat said, I sometimes think about moving back to the states. It's tough always being a foreigner.
Let's switch places? :).
DeleteAnyone like TRIP? Beaten down....and is the company of reference for hotel and restaurant reviews. I think it does well long term, the only question is at what price do you buy? Growth seems to be slowing somewhat. I own a few "starter" shares.
ReplyDeleteBarcelona is a beautiful and fun city with a nice climate, so will almost certainly be one of the winners in the new economy, so good place to be.
ReplyDeleteFound this report: http://www.gurufocus.com/global-market-valuation.php
Basically compares current valuations to long term valuations by country.
Spain rated 3rd of the developed markets, whereas USA at the bottom. I think you have to do some thinking around this. Netherlands, where ING is, rated 5th and I think lower risk than Spain given their heritage and a good place to look.
I almost bought TRIP a couple years ago under $30, so hard to buy in the $60's. Good business, but expensive stock, so you have to believe in their growth.
ReplyDeleteTRIP revenues still growing strongly (up nearly 40% from the year-ago period). It may even be a buyout candidate. I could see someone like PCLN buying them to create the industry behemoth.
ReplyDeletePHM - This one's been ripping and it's gonna continue, huh?
ReplyDelete"I've been thinking about getting long the EuroStoxx 50. With the ECB undertaking a QE program"
ReplyDeleteIs that actually going to happen? If yes then it seems like there should be a nice rally (assuming it's not priced in already).
I'd think an ETF like PGAL might give some hint but lately it's not telegraphing this message.
DeleteDraghi announced that the bank would seek to bump the ECB balance sheet up to "2012 levels", which implies a €1 trillion increase. I think that qualifies as QE.
DeleteThey are buying asset-backed securities and euro-denominated covered bonds, but not sovereign bonds (at least yet) as the legality of doing so is in question and it seems the Germans are not on board with it.
Yeah, I'm sure they're being selective assets but I wasn't aware Bundesbank had actually approved this, thought Bundesbank is calling this illegal and the decision is indecision? I'm probably too far behind the curve, mostly by the time I hear/read about stuff it's already priced in.
DeleteTake EWG for instance, shouldn't this one be ripping higher if the current programs were deemed adequate?
DeleteSaudi Arabia - I'm struggling with this strategy as I understand it, why would SA be throwing low prices at the US specifically instead of Europe when Europe could actually benefit the most? It's puzzling me.
ReplyDeleteTo hurt the frackers and slow down shale growth.
DeleteYeah, but selling your commodity cheap into a market that's currently land-locked doesn't seem like a logical approach b/c those hydrocarbons in the ground don't go away as decades pass, more like a ST strategy. SA should compete LT by erecting refineries for exporting finished product and create employment for their countrymen instead?
DeleteThis strategy actually creates US employment?
Not sure about a TRIP buyout. It was owned by Expedia for years and they just spun it out a couple years ago, so I would assume there's not many synergies. They do have a very good business though. The real question is how much growth is priced in versus what really happens. I am not good at estimating those, so stay away, but certainly could see why you'd want to buy it.
ReplyDeleteReading a bit on PBR.
ReplyDeleteWarren Buffett has a quote "Only when the tide goes out do you discover who's been swimming naked."
Well, looks like now that the tide of high oil prices is going out, PBR may have been swimming naked
I agree completely. I think there's a lot more pain down the road
DeletePBR is one my least favorite blogger was touting, which makes me think he's short.
DeleteOk we need to consider what the play is on this...
ReplyDeletehttp://bleacherreport.com/articles/2266854-jose-canseco-says-human-beings-will-rule-the-galaxy-by-traveling-via-comet?utm_source=cnn.com&utm_medium=referral&utm_campaign=editorial&hpt=hp_t2
How about Jim Beam and cocaine? I don't get the attraction for space travel to a place depicted in sci-fi movies, would rather see these genuine efforts be used for cleaning up the plastic soup floating in the Pacific.
DeleteI have to guess he's long TSLA or something but the likes of CLH/TDW/CKH/GLDD or maybe even BP/XOM comes to mind, once Conseco's space-buzz wears off?
Or perhaps ORB, I hear this one might explode higher.
DeleteINVN micro-gyros?????
DeleteNow I 'm beginning to think someone must've painted Conseco's mailbox with a neurotoxic paint or something, SHW has been ripping higher on booming sales of this popular coating.
ReplyDeleteF - Gonna close that gap at $16.75ish, isn't it?
ReplyDeleteThe unwelcome mid-day swoon.
ReplyDeleteFSYS - Moving up a lot lately.
ReplyDeleteThis company was called onto the carpet for doing business in Iran if I recall. Now sanctions have been dropped, correct?
DeleteCXO - Looks like a bull flag to me, higher risk than BALT?
ReplyDeleteJONE - Even with yesterday's oil swoon JONE has not produced a new lower low, seems pretty strong.
ReplyDeleteMEMP - Did make a new low probably concern over the juicy dividend? $19 looks like the open gap down if SA already blew their wad and ran out of gas..
DeleteAsleep at the wheel over here......
ReplyDelete"Boeing (BA) and General Electric (GE) receive U.S. government approval to do business with Iran for the first time since...
TASR - Jumpin' Josepha, would be my choice over rat on a stick cameras but I don't consider myself very smart and certainly inexperienced (both of these are major downfalls) so what do I know?
ReplyDeleteThe theme here is police cameras, I have no idea of which is making the grade but it appears the market does?
INVN - Huge short float. Pfffhhh, is this thing on?
ReplyDeleteSTM - October and November, identical action. Does STM compete directly with INVN?
ReplyDelete"Police Forces From New Orleans, Norfolk, Savannah, and Miami Beach Choose TASER's AXON and EVIDENCE.com Solution"
ReplyDeleteJust noticed this.
So despite the huge SA hydrocarbon fire sale, no thank you very much anyway, the $US is going to reverse to the downside? Amazing, Europe must be the place to be then.
ReplyDelete$7T of loans denominated in $US reasons for this?
BofAML Weekly Metals Musings: China retiring as world commodities engine
ReplyDelete11/10/2014 5:30 AM
We came away from an Asia trip cautious on steel inputs, but investors were keen on ali. AA day was unsurprising. VMC beat. We discuss the real risk of a flat demand outlook for Chinese steel, which would be particularly bad for iron ore and coal. We continue to be cautious on steel prices, noting the correction of scrap to lower iron ore prices. We like NUE, ATI, VMC.
TC - We're the guys to turn to for whatever you need.
ReplyDeleteCoal vs iron ore - If my memory is correct, India has plenty of iron ore but lacks coal and the harbors for accommodating today's huge bulk ships.
ReplyDeleteSo might this be a reason for snapping up a ton of smaller ships on the cheap?
Expanding their fleet of small ships is precisely what VLCCF has done recently, correct?
DeleteAdding to this observation from the lunatic fringe, if you were China with deep harbors would you help India by flooding the market with giant ships that are well oriented towards serving the harbors of your best trading buddy India ?
DeleteYou guys have been busy.
ReplyDeleteNo love for steel anymore, so I'm looking at AKS chart at the moment.
DeleteMiniature survey - How are your home and business energy needs met primarily? Solar panels on roof, natural gas appliances, coal fired furnace, or hot water burbling from the ground in Iceland?
DeleteNat gas and purchased electricity.
DeleteI wish FCAU had more chart history...although that probably works in our favor.
ReplyDeletePull up FIATY. or go to:
Deletehttp://www.marketwatch.com/investing/Stock/FCA?countrycode=IT
Reuters U.S. News @ReutersUS 17m17 minutes ago
ReplyDeleteStrippers win $10.9 million judgment for unpaid wages from New York club http://reut.rs/1xXSBAG
---------
Just trying to contribute.
Getting BRIC’d up this morning in the back alleys of Rio has paid off.
ReplyDelete(a) EWZ bid 39.30. Second tranche now +1.4%.
(b) PBR bid 19.97. Second tranche +2%.
(c) RSX bid 20.64, +1.2% from basis.
(d) CAF bid 25.80, +1.6% from basis.
(e) EEM bid 41.32. RYWVX opened the 1030 window @ 72.20. Based on the current bids for EEM + EWZ, will likely close the 345 window 2%+.
My only regret is not to have opened a position in miners as well. GDX now +6%.
I have no plans to close any positions today.
With a big reversal in the Euro today I think it's time to consider everything that goes up with a declining dollar (in short term). My guess is you see a mini rally in the Euro and a fade of the dollar into New Year's. It's time to look at those oil names & miners closer probably.
DeleteI'll just stick with my all in on FCAU tho. I think this is another good play on this move in currencies, coupled obviously with what I think is a grossly undervalued company.
DeleteMake that +4.2% for PBR.
Deleteexcellent. are you holding it over the weekend?
DeleteTLLP - Registering high on the Richter scale.
ReplyDeleteHIMX - Hello, old friend! What do you have in store for us next week?
FCAU/FIATY- They don't look that close to me??
ReplyDeleteFIATY was the OTC symbol before they got the FCAU listing. Would have been nice if they carried the chart history over, but didn't, so you can either try and visually link them together or look at the MIlan listing as TOF suggested. Milan has history since 2000.
DeleteHave a great weekend everyone, just one more Q before I go outside and scream once more... This one's rhetorical and strictly for entertainment purposes:
ReplyDelete"If I were a carpenter and you were a lady, would you marry me anyway, would you have my baby?"
Just doing some reviewing of my YTD gains / losses. Despite having one of my best years yet, I managed to make money on less stocks than I lost money on (had a 49% success ratio). Reinforces the concept of cutting losses quickly I guess.
ReplyDeleteThanks for sharing.
DeleteNot sure there's much to take from it but you're welcome. I was surprised to see it
Delete(a) Added a minor position in RYEUX (Rydex Europe) at the close.
ReplyDelete(b) RYWVX closed @ 73.21, or +1.4% from the 1030 close. The gain appears 'suppressed,' as EEM/ EWZ closed +0.8%/+1.4% from their 1030 prints. I would have expected at least a +2.8% rise.
(c) CAF closed @ 25.95, +3.84% for the day and +2.2% from my opening basis.
(d) RSX closed @ 20.67, +1.4% from both yesterday's close and my opening basis.
(e) PBR closed @ 9.95, -2.45% from yesterday's close but +4.2% from my opening basis.
I can think of no reason not to hold all positions through the weekend.
Say what?
DeleteI have chips on 4-5-6-8-9-10 in addition to a pass line bet on emerging markets.
DeleteDidn't you close b,c, d, and e?
DeleteNo, what gives you the impression that I did?
Delete"I can think of no reason not to." Wait a sec while I run that one through my boolean logic analyzer. :)
DeleteCNN Breaking News @cnnbrk 40m40 minutes ago
ReplyDeleteStudy finds that chemicals in sunscreens may lead to infertility issues in men. http://cnn.it/1EMb1sh
Make fun of that one!
A chemical vasectomy would beat a real one, hands down.
DeleteIt converts you into a nano-man?
Deletehttp://fortune.com/2014/11/14/caesars-says-its-main-operating-unit-needs-restructuring/?xid=yahoo_fortune
ReplyDeleteNever bet against the house? Bad management can run even a casino into the ground.
Z- is today the first clear sign of performance chasing?
ReplyDeleteDude I was really close to shifting money into that under $100. I just think that's the one true winner amongst all of these high priced internet companies. They're building monopoly
DeleteTOF was hoping I'd buy FCAU so he could flip to Z, but that didn't happen.
DeleteGood writeup on FCAU and basically what we've been saying here already:
Deletehttp://oraclefromomaha.wordpress.com/2014/11/02/update-im-back-at-least-for-a-while/
FCAU is about 1/2 way down.
Ouch that HTZ, Luckily oil prices have provided some breathing room.
ReplyDelete$WTIC - Why do they blame the oil sell off on falling global demand and fail to mention the $US rally? Is it b/c they want mom and pop to think the global econ is weakening?
ReplyDeleteFIATY - Here's the chart I'm looking at and it shows the ema's had rolled over up until the time the chart stops and switched to FCAU. If this chart was continued without that switch, looks like the ema's would probably be reconverging about now?
ReplyDeletehttp://stockcharts.com/h-sc/ui?s=FIATY&p=W&b=5&g=0&id=p93675313354
On top of that, I see there was a big player adding GM this week?
Buffet did a fairly large add to GM last quarter according to 13f filings.
DeleteBrandt - Possibility for $50 crude: "The weekly Crude Oil chart explains the current weakness. The 3-1/2 symmetrical triangle on the weekly chart has a target of $50. Look for real estate deals in North Dakota."
ReplyDeletehttp://peterlbrandt.com/wp-content/uploads/2014/11/11.13_CL_W.jpg
DeleteAMZN - ema's have rolled over during this initial period of weakness, on this chart:
ReplyDeletehttp://stockcharts.com/h-sc/ui?s=AMZN&p=W&b=5&g=0&id=p03471194703
TOF, if i look through my stocks this year, i have a lot of losers as well. But fortunately, my largest positions have done well. My top 3 of my 40 stocks generated 2/3 of my profit.
ReplyDeleteI think it just shows you had to pick good stocks this year.
(a) Short term: http://www.marketwatch.com/story/how-to-play-the-historic-opening-of-chinas-stock-market-2014-11-14
ReplyDelete(b) Long term: http://www.jasonzweig.com/manias-and-meddlers-the-secret-past-of-the-chinese-stock-market/
I agree with this 2nd article quite a bit. I think the European markets are the best play here because they're the closest to the US in terms of the soundness of capitalism...and some of them are cheap.
DeleteJP MOrgan hot on Europe:
Deletehttp://www.bloomberg.com/news/2014-11-17/jpmorgan-says-sell-u-s-stocks-buy-europe-on-valuation.html?cmpid=yhoo
JPM - Buy europe! That must be hot off the press, DB/EWZ/EZU Jumping now!
DeleteGood article on micro cap spinoffs, something I've been reaearching for potential anomalies in the mkt:
ReplyDeletemicrocapclub.com/2013/10/lessons-learned-investing-microcap-spinoffs/
How about office space rental, for small but growing startups where the home office no longer cuts it?
Deletehuh?
Deletenvm, I'm used to having every single one of my ideas shot down, no big deal.
Deleteha i'm not sure what that has to do with spinoffs so just curious. i'm actually putting together an idea for a business that takes advantage of the work from home trend so i'm all ears.
DeletePLL - Water filtration is hot, is that driving the stock? We knew it would be, didn't we?
ReplyDeleteNothing to appealing this morning.
ReplyDeleteNeed the Euro to stop dropping to give stocks like FCAU more tailwind. It's fighting an uphill battle every time the Euro drops so much. Fiat is up 1.1% in Europe but only 0.4% in the US.
ReplyDeleteI was thinking in those same terms, not specifically FCAU but all of europe? Anyway, is FCAU an euro play, a US play, or an IP play? Or perhaps all of the above?
DeleteFCAU headquarters are in Italy and I think about 1/4 to 1/3 of their sales come from Europe...however, the Fiat brand is dragging them down and there's substantial excess capacity in their plants in Italy so I think the theory is that they hope to shift production over there to take advantage of the excess production capacity. A rebounding Europe would help things out significantly for them and all auto makers. FCAU is a dirt cheap stock as it is though so I'm not sure it will need a ton of help from the Euro. But a collapsing Euro does no one any good.
DeleteI like the Fiat brand, LOL! :) Considering F makes their profits on pickups so maybe Fiat, being the little shift boxes they are, aren't very profitable.
Delete"Japan economy in recession" Umm, what's the unemployment figure?
ReplyDeleteIts all because of that foolish sales tax boost.
DeleteIf you like Europe, and want broad exposure in addition to FCAU, check this out.
Deletehttp://etfdb.com/etfdb-category/europe-equities/
Seems like they short cover all the weak sectors on Friday and then the battle renews the following Monday.
DeleteGreat call on FCAU and the autos in general, Appalosa's largest holding is GM which I think some hold here.
Sorry thought was responding to the FCAU thread above
DeleteExactly, as if the sales tax boost was going to encourage consumption. WTF?
DeleteHLF - Does Ichan still own this?
ReplyDeleteOn Saut's most recent weekly note:
ReplyDelete"Some pundits are saying that the bear market in crude oil is an ominous precursor to a bear market in stocks, but this is not backed up by the historical facts. In examining the SPX’s performance during bear markets in oil shows the SPX has an average +3.02% (median +5.51%) gain two-thirds of the time according to the good folks at Bespoke. To further illustrate this lack of correlation, Bespoke constructed the nearby charts and wrote:
Bull markets are shaded in green while bear markets are shaded in red. Here it is hard to make any compelling argument that bear markets in crude oil have been bad for the equity market. In fact, during 84% of all the days that crude oil has been in a bear market, the S&P 500 has been in a bull market. A more persuasive case may be that bear market periods in the S&P 500 were preceded by bull markets in crude oil.
"
It is also worth noting that the current “bear market” in crude oil, at 416 days, is the second longest bear market in the past 30 years, with the longest being the 541 calendar days affair between 6/24/92 and 12/17/93 (another tip of the hat to Bespoke). Accordingly, I think crude oil is in the process of forming a bottom, but the oil complex stocks will likely have issues in tax loss selling season before they bottom. Still, dividend-paying oil stocks should be accumulated between now and the end of the year because they are trading below “known valuations.”
DeleteI keep looking at GOOGL and wondering if there's something inherently wrong with them...keep thinking maybe its a change in the way people are searching on phones vs laptops or maybe facebook / apple / twitter / yelp are all stealing a little market share...but then if you look at the longer chart you realize it doubled in 18 months so it's most likely just consolidating. That's one big cap business that I think is a no brainer.
ReplyDeleteWhat are they up to, renting moffet field?
DeleteI think GOOG is a premier company, but it is just hard to move up on such a large market cap.
DeleteI always like this guy, John Bogle. He's the founder of Vanguard and viewed as the grandfather of index fund investing.
ReplyDeletehttps://www.youtube.com/watch?v=yfknQvVkDUU
This was during the middle of the 08 crash. My brother was asking me if I know of him.
I was watching another interview from a guy that was talking about index investing and he had a really great comment that I never considered: he said its not some great tragedy if you can't outperform the S&P 500. consider that out of the millions of businesses out there, these are the very best 500 companies. so if you can't outperform them it's not that unusual. obviously we can outperform them but it's a great point.
All I need to know is, if eurozone stimulus going to proceed or if Germany is going to nix the idea. I don't have the simplest piece of info I need, to make a decision.
ReplyDeletewho knows. just seek those companies that are cheap / beaten down with catalysts. if stimulus comes it will only help.
DeleteI've liked VE for a while. it's not that cheap but it's in a solid business with structural tailwinds behind it. plus, technically i like these types of setups that it has where it broke down so fast in 2011 that there's not a ton of overhead resistance until the mid 20's so after it gets above $20 it could move up pretty quickly. kind of like what happened with X earlier this year.
DeleteI agree buying cheap offsets a lot of risks and is always good. The other thing is the EU is going to do something if necessary. Even the German's aren't going to let the whole thing fall apart if they can help it.
DeleteLet me know if you guys hear something please, meanwhile I'll try following chart indicators (which are positive in many respects). There are always options, I might have to add to energy or buy EWZ if europe gets away from me.
DeleteTSN Blow off top?
ReplyDeleteThe declining Euro is good for exporting companies, but the trick is that the benefit they receive from a lower Euro are greater than the decrease in stock price due to it being quotes in Euro's. Maybe thing like Sieman's, SAP, UL as some quick ideas.
ReplyDeleteyep also have to take into account that their products are cheaper to overseas buyers.
DeleteSMT - Going off the cliff.
ReplyDelete(a) Shanghai + HK both opened at their highs last night, only to sell off into the close.
ReplyDelete(b) Accordingly, both CAF (Morgan Stanley China ‘A’ Shares) and EEM are pulling back today.
(c) EWZ (Brazil) and PBR (Petrobras) have also pulled back.
(d) With the exception of Russia and Europe, the positions I opened Friday are now back to my opening bases.
(e) I plan to give the positions another day to play out.
Russia sure is cheap - if Putin backs down and pulls out of Russia, would see a big pop. Don't know if politically he can do that though.
DeleteJPM - So just to clarify, JPM advises to sell the US market in favor of Europe.....
ReplyDeleteQuiet US market the last week or so - means and buying and selling in balance.
ReplyDeleteMy thinking is we break upwards as we start to see the typical year-end rally driven by people putting bonuses, retirement contributions, etc. into the market. I think we need some bad geopolitical news to break downwards.
Z for zillow
ReplyDeletehttp://priceonomics.com/the-seo-dominance-of-zillow/
RSX (Russia) off pre-market @ 20.96 for a 2-day gain of +3%.
ReplyDeleteSolid European sales figures for fcau
ReplyDeleteSeemed like good car sales across the board for all.
DeleteI peeled off 15% of my shares of FCAU at around $12.7 trying to play a dip.
ReplyDeleteI hate when this happens:
ReplyDeletehttp://espn.go.com/mlb/story/_/id/11879624/jose-canseco-says-re-attached-finger-fell-poker-game
The guy strikes me as not very bright?
DeleteEurope - Have they actually done anything or is this just a hopeful response to lip service?
ReplyDeleteAEG - Was considering this one y-day b/c it was beat up and looked like it stopped moving down but noticed my broker downgraded it.
ReplyDeleteDo you guys know the best way to get allocated shares of an IPO before it trades? TD Ameritrade never has any shares available.
ReplyDeleteI think you have to be a qualifying investor (large pockets)?
DeleteWith TD in Canada, they have a new issues portal where you can sign up to get email on new issues. We don't get the hot US ones like BABA, but we do get some hot Canadian ones. I've only bought I think 3 of these, and always got a fill, although usually not a full position.
DeleteMUX - up 17%, that's real money if you bought yesterday.
ReplyDeleteThat double bottom in SPWR is very compelling. I picked up some SPWR at $28.08 hoping for a run to $31-32. Still like the solar sector longer term but for the short term there seems to be a reasonable floor of support to trade against.
ReplyDeleteStrategic $2.4B deal to split up operating and dev assets between SUNE/TERP
DeleteSUNE and TERP surprised us today with their announcement to acquire First Wind, a top developer of
North American wind assets. Similar to the AES/ Silver Ridge deal, the transaction is marked by
separating the assets of First Wind between the SUNE YieldCo and DevCo, optimizing the transaction.
The DevCo gets 1.6GW of development assets, although we look forward to some more background on
the assets in terms timing, location, and maturity. With TERP taking 500MW of wind assets and 21MW
of solar assets, TERP is adding $72.5M in CAFD, which was purchased for a total EV of $862M or around
12x EV/CAFD, roughly in-line with many of recent YieldCo transactions.
Transaction pumps growth economics and diversifies platform into wind
At the heart of the transaction is the significant operational MW growth in TERP, growth to +2GW of
2015 deployed MWs and raised CAFD/ dividend guidance to $214M and $1.30, significantly pushing
forward economic timelines. SUNE has already guided an expectation of a 1 year pull-in on IDRs and
there may still be opportunity to outperform here through more acquisitions and organic adds. However,
we believe that SUNE's diversification into wind is one of the biggest parts of the transaction. We look
forward to hearing more about the integration of the First Wind platform from an operational level and
in growth opportunities (i.e. Canada, South America, etc.)
Looking to hearing about future wind dev goals and financial timeline update
We also look forward to tomorrow morning's call giving us some more diligence color on the pipeline,
backlog additions to the call rights and the associated timing of assets. We also look to see more
information on SUNE's assumptions on IDRs and what current expectations are for 2016 onward.
Finally, we hope to hear an update on current financing needs for both SUNE/TERP post-restructuring of
debt as this transaction will likely use up a majority of outstanding liquidity.
CP, re AEG, if you want to buy for a couple year hold and what should be a very good return, at $7.81, there are probably only half a dozen days this year when the price has been lower.
ReplyDeleteIf you want to play for a bounce, I can see not buying today.
TD likening the current market to the late 90's period, which was a great time for stocks:
ReplyDeleteMarket Overview
From a more technical perspective on U.S. equity markets, we are seeing two
positive indicators suggesting that the current rally could continue into and perhaps
through the year-end.
First is the continuing strength in the U.S. transportation sector. Not only is the
Dow Transportation sector ETF (IYT-US, US$163.60) setting new absolute highs,
but it is also setting new relative highs versus the S&P500. We view the relative
strength in the transports not only as a positive leading indicator for the overall
equity market, but for the U.S. domestic economy as well. On the latter point, we
are also entering into a seasonal period when the U.S. economic activity tends to
accelerate, as we saw last year. If the U.S. economy were to surprise on the upside,
it could lead to modestly higher interest rates and further strength in the U.S.
dollar. This could then lead to lower oil prices (on a stronger U.S. dollar), leading
to further relative strength from the transports.
From a Canadian perspective, Canadian National Railway Co. (CNR-T, $80.70;
portfolio weigh 9.0% is one of our top selections to gain exposure to the U.S.
transports and a resurgent U.S. domestic economy. It is our view that the U.S.
economy is beginning a bottom-up consumer-led recovery not dissimilar to what
we would normally observe in the early phase of an economic cycle. Importantly,
this resurgence also occurred in the later stages in the 1990’s cycle from 1997 to
mid-1998. We continue to draw comparisons from that period to the current phase
in today’s cycle given the very similar global macro backdrop. Although the
causes may differ, the results are the same — a weak global economy versus a
stronger U.S. economy, a stronger U.S. dollar, and lower commodity prices.
We believe that a consumer-led U.S. recovery fits well into CNR’s “early cycle”
relative performance versus the U.S. rails. Technically, CNR’s relative
performance versus U.S. rails is highly correlated to the relative strength in the.
S&P homebuilding sector, which in part is explained by CNR’s relatively high
wood products exposure. The S&P homebuilding sector has been one of the top
performing sub-sectors, up nearly 25% off its October low. It is also worth noting
that it was also one of the top performing subsectors from Q1/97 to Q2/98, gaining
Deleteover 100%.
Second, a more recent positive technical indicator has been the recovery in U.S.
small caps. Following a relatively weak past year, the recent market recovery off
the October low has been led by U.S. small caps. Importantly, the relative recovery
of the small cap has been led by the consumer discretionary and bank sectors.
Again, we believe that this is another positive indication of U.S. consumer strength
and a broadening of the U.S. recovery.
From a Canadian perspective, our top large-cap selections for relatively high
exposure to a U.S. consumer recovery remain Gildan Activewear Inc. ( GIL-T,
$66, portfolio weight 3.6%) and Alimentation Couche-Tard (ATD.B. $40,
portfolio weight 5.8%). Similar to what we saw through the later 1990s,
consumer growth stocks could experience a further multiple expansion against a
weak global economy and low commodity prices. Although Couche-Tard at 20x
12-month forward consensus earnings looks fully valued, we believe that Gildan at
15.7x still has multiple expansion potential.
Energy
Similar to the non-recession major corrections we saw in oil prices in 1986, 1997–
08, and in 2006, we believe that oil prices need to re-adjust lower on deteriorating
supply-demand fundamentals. The ending of QE and the revaluation of the U.S.
dollar has, in our view, exposed oil and other commodities to their weak
underlying fundamentals (excess supply and weak global demand). It has been our
view that commodities through the current cycle were overinflated through
monetary stimulus. As a result, the current correction is steep, largely because oil
prices were, in our view, fundamentally too high. Subsequently, for us to turn more
positive on oil prices and the energy sector, we now need to see improving
fundamentals against the backdrop of what we believe will be continuing U.S.
dollar strength. With U.S. inventories and speculative net long positions still too
high, in our view (see exhibits 7 and 8), we believe that oil prices could remain low
or move lower, particularly if the U.S. dollar continues to trend higher.
Nice to see this AFTER taking a 50% haircut on BXE, now jump into autos for a repeat? Umm, can't do that.
DeleteGreat interview with Joel Greenblatt:
ReplyDeletehttp://wealthtrack.com/recent-programs/greenblatt-strategy-change/
Here's some more info on Greenblatt:
http://basehitinvesting.com/some-thoughts-on-joel-greenblatts-magic-formula-and-its-ytd-results/
Here are his results using the Magic Formula:
http://basehitinvesting.com/wp-content/uploads/2013/09/Magic-Formula-Results-vs-SP-500.jpg
The Magic Formula method of picking stocks averaged 23.8% per year vs a market average of 9.6% during the period from 1988-2009.
Must be about time for Japan to panic again and print more YEN, better get long TM in case and/or short KB b/c Korea will be the victim.
ReplyDeleteIt's impossible to invest while currency wars are being waged.
TEP - This one's a sort of spin off.
ReplyDeleteConsidering natty is pretty cheap and coal is cheaper than dirt, then why hasn't my electric bill collapsed? Where'd that money go?
ReplyDelete(a) After treading water most of the morning, EWZ (Brazil) is launching into the close (+2.58%). I’m closing EWZ here @ 39.85 for a 2-day gain of +2.84%.
ReplyDelete(b) PBR plunged to 8.80 intraday, and now back to 9.45 (or about -0.12/share above the 9.57 basis of my second tranche). Taking it off here.
(c) VGK (Europe) trading +1.5%. I plan to take RYEUX (Rydex 1.25x Europe) off end of day for what will likely be a 2-day gain of +2.4%.
(d) EEM currently +0.6%. EWZ now +2.65%. Between the two, I’m guessing RYWVX will end the day between +1.5% and +2%> taking the entire position (opened in two tranches over 2 days) off at the close.
(e) CAF. Made the wrong call on this one! I opened @ 25.3x last Friday, watched it climb to 25.95 at the close, and decided to hold through the weekend. Yesterday, I watched it gap down to 25.45 and close at 25.25. It gapped down again this morning to trade as low as 24.90. Taking the position off here @ 25.12 for a -1% loss. Obviously, I don’t like watching a +2.2% gain slip into a -1% loss, but the open of the Shanghai-Hong Kong Connect was a ‘damned if you do, damned if you don’t’ situation. Had I closed last Friday, CAF would have gapped UP to 26. Since I decided to hold, it naturally gapped DOWN. It happens.
I’m actually quite bullish on Emerging Markets and Europe for the next few months, and expect the global stock market ex-US to outperform. Regardless, risk levels are high right now and I have to take gains whenever I have them.
Like I said, you're in the zone.
DeleteNXPI - I like this stock but why now are there so many arrows pointing in it's direction and not at the recent lows? Gotta wonder.
ReplyDeleteVGK FEZ
ReplyDeletegap-ed with DB
PXD trying to turn
DeleteVGK went long gapped up and broke above 50 dma, my timing has been off lately so who knows
DeleteI ended up bailing on 1/3 or so of my FCAU around $12.75 or so avg (not sure). I am trying to play a potential pullback here coupled with a few really interesting short term trading opportunities I see in a few stocks I'm still researching, one of which is SPWR which I took a decent sized position in.. Keeping a core holding in FCAU regardless as I think it gets to $20 or so within a year.
ReplyDelete"With TD in Canada, they have a new issues portal where you can sign up to get email on new issues. We don't get the hot US ones like BABA, but we do get some hot Canadian ones. I've only bought I think 3 of these, and always got a fill, although usually not a full position. "
ReplyDeleteThanks.
What's a full position for you? 2%? Or do you have a few larger positions and dozens of smaller ones?
I usually buy a position of about 3% (in tranches). Then ones I really like I will go to around 10% - 15%. My top 5 holdings are 50% of my portfolio. I also buy longshots once in a while (0.5%).
DeleteI think I end up with 40 stocks because some move up slower than expected but are too cheap to sell, but too expensive to buy more, and they just become a smaller percentage as my portfolio grows faster.
22 of my 38 stocks (58%) make up less than 20% of my portfolio, so a good number in this bunch. I've tried to do some analysis to see how it would affect my results if I was more aggressive in cutting losses, but it is hard to do. I suspect it would not be a big effect though.
DeleteThere are so many interesting setups its hard to contain myself!
ReplyDeleteSPWR
FSLR
HCLP / SLCA / EMES
FXE / Short Dollar and its implications
NBG
IRE
EWZ
EEM / EDC
YNDX
ENSV
and I have a bunch of others including some new IPOs. this is going to be an interesting run into the year end.
You left out GDX/ GDXJ. Had I stuck with them, my gains would be 2-3 fold higher.
DeleteAlthough my better half is still holding.
DeleteRYWVX and RYEUX (both leveraged funds that can be difficult to 'price' ahead of the close based on proxies such as EEM and VGK) closed significantly below my lunch time estimates. Often an indication of weakness 'under the hood' despite strong rallies in large cap (aka 'headline') indexes.
ReplyDeleteAnyone looking for a decent entry/reentry into stocks will probably see one within the next few days. JMO.
ReplyDeleteTOF, when you talk about these setups, what timeframe chart are you looking at and what is it that makes you think they are good?
ReplyDeleteThanks.