Currently Bearish Tech Stocks (video) Wednesday, May 19 2010 

This is a direct link to a video entitled “Bearish Tech Stocks” – that have done nicely (in a bearish way) so far this week (for the shorts).  This was posted 3 days ago, late Sunday night.
http://www.youtube.com/watch?v=GTCk1NhoPv0

Here is an update to the post about CRUS:

CRUS is now the largest positon in the portfolio at 7.6%, and +60%.

Current price: 13.79 (0.06)
Shares: 90,000
Entry price: 8.57
Value: $1,241,100

I actually made a tribute/infomational video on CRUS and posted it to YouTube.com under user name 2525Maybach. There is another video posted entitled “Bearish Tech Stocks” – that have done nicely (in a bearish way) so far this week (for the shorts).

Video- What’s inside an iPad? Monday, May 17 2010 

Answer:  Cirrus Logic (CRUS)

I recently put this video together.  Remember, you can see the portfolio updated in real time with the Facebook app by going to Randall Williams, and clicking on “Applications” and then “allow” the application.

Study this chart (below) in relation to the recent market volatility, and be amazed by  the strong performance.  This was added in real-time to the Facebook portfolio (look under applications in Randall Williams).

This is the chart that appears in the video (click on it to make the image sharper).  Here are the bullet points that appear in the video:  Analysts expects Apple to sell 5 million iPads this year.  The company is seeing strength from iPhone sales and builds for new products such as the iPad and next generation iPhone.  Some believe this to be the best derivative play on Apple (AAPL).

Kaching Investor IQ App Updates Sunday, Apr 11 2010 

(For more info go to Facebook.com and type in search box “Investing IQ” then search for Randall Williams to see the portfolio by clicking on Applications, then “Allow Application.”

CAKE nice setup for Value investors (my port is Growth. It’s always interesting when you see Value & Momentum, anyway…that would be CAKE.   4/6/10 4:23 PM

Saw you initiated a position in SIVB today. Never heard of it but everything about this company looks good after a fast screening, except that they don’t pay a dividend ^^ What do you see in it?

My portfolio style is growth, not value. I was wanting to add a regional bank, but was difficult to find the right combo of good chart pattern and a growth stock in this industry group. For instance, ZION is a value stock, but probably has more momentum than SIVB. In fact, SIVB isn’t even classified as a momentum stock at present, which could be in my favor if it gains momentum later. You can track this industry using these tracking stocks (ETF’s) such as KRE and for the sector (financials) using VFH. I wanted a bigger position (arouond 5%, but only had cash for half a postion).

They were saying on CNBC today (last hour) how that the low volume indicates how folks still don’t bellieve in this rally. Then Maria B. posed the rhetorical question, “What does it take for people to believe?” I broached this topic yesterday on the community message board, and it did not go over very well. Perhaps that proves my point!  [My comments had to do with Mom & Pop investors still not believing in this rally, but it seems like most people don’t understand why that is important, and in a good way, for the bulls.]

My question is, who cares if they don’t? What does it matter? It’s not our job to convince people. I’m actually not a true believer but I’m riding the trend. I’m lagging because I took money off a while back waiting for a pullback that never came. I think we can ride higher than this but I will probably take start to take some gains off if we move much higher.

Great question, thanks. In my opinion, it is a very good sign that people don’t believe in any given rally. That means that the rally has “legs” (potentially more room to rally). So, I think it matters a lot. I think it also helps to look at bonds, because a lot of money was going into bonds over the past year, all the while missing perhaps the biggest rally in market history. When people hate stocks, that is good for being long. In the laste 90’s everyone love stocks, and the market was actually very tricky (I remember the best performer of 1999, which was QCOM, gapping down over 40 points, to rally back later).

See post last week on my message board (below): <<Bullish market break if SPY holds here above the 117.30 level…it could be an end of quarter headfake.>> SPY now at 118.50+ ….It was an interesting and tricky time for the market, with eight, yes 8, doji’s and spinning top candles at or near that very level.  4/5/10 10:30 AM

CREE: You may remember seeing the stock reco on the Maximize401k.wordpress.com blog from a few months ago. Wow, that was weird, just as I was typing this, they were talking about it on CNBC. As far as the p/e is concerned, it was be well below 50 in a few months (perhaps less than 6 months). Tremendous growth. If anyone had wanted to MAXIMIZE their 401k (the new pension plan for Americans, even for state pension funds, such as Nebraska, the Warren Buffet state) – this would have been the stock to buy, as Maximus indeed reco’d !!!   4/5/10 10:24 AM

 

Market Has Pre-Explosive Look and Feel Friday, Mar 12 2010 

Market Has Pre-Explosive Look and Feel

For several days over the past week the Nasdaq has been out-performing the Dow and S&P 500 significantly…up twice the percentage move or better.  Although the Dow is not at 52 week highs it still has the pattern of a potentially bullish mover.  The QQQQ has hit 52 week highs for the past 3 days.

I mentioned AMZN as a fabulous options player in my blog last week (Maximize401k.wordpress.com).  There are also other strong players we have been relying on as option trading vehicles such as GMCR, AAPL.

Disclosure: Long GMCR, AAPL, AMZN

AMZN – Amazing Amazon Tuesday, Mar 2 2010 

Low Volatility (totally sideways action…or inaction) follow by fantabulous volatility explosion.  We took advantage of this set up to teach our 17 year old the power of stock options.  We told him to watch what happens to the options last week on Friday because we expected a substantial up move in the underlying stock, taking note especially of the March 120 and 125 options.  We had positions on, so he was able to experience that first hand also.  See the chart below.

See also some of the model portfolio stocks for your 401k.  Not many comments made recently because the market did not do much around Christmas, and then there were not storm clouds on the horizon.  For example see CREE mentioned late last year in the 40’s, hitting near yearly highs at 70 and outperforming the S&P 500 by wider and wider margins.  We will update the portfolio performance soon.

Thursday, Jan 21 2010 

Goldman Sachs!  What can I say.  Creating the products that get us into trouble, selling them, and then shorting them.  When asked (under oath in the U.S. Senate) why they packaged those CDO’s and other such garbage, Lloyd states…that’s what people want, so we sell it!  Here’s a comment from MarketWatch.
<<We should get rid of companies like Goldman Sachs. Permanently. In the old days, investment banking was useful: allowing private investors to be co-owners of all kinds of corporations, and in return providing these with capital for investment and the creation of wealth.

Today, this is a tiny fraction of what Goldman Sachs, JPMorgan and the likes do. Their business is more like a casino: betting and speculation. Layers and layers of financial products like russian dolls; when will people realize that for every dollar they invest the actual product is a tiny fraction and the rest are commissions and promises of a bogus return in the future?

The money they make comes from: a) the extra margin we all pay on almost everything, from utilities to commodities (raw materials, food, etc.), since they have already bought them and sold them with profit with their derivatives and b) the money we are all going to lose when the market collapses; either directly or indirectly – through our taxes to bail out banks and insurance companies, while their management walks away with billions in bonuses.

Decades ago, the financial industry used to amount to 5-10% of the GDP; recently, it was around 40%. What does this tells us? Simply this: we’re buying very, very watered-down whisky. The whole world is suffering and working like crazy while these vampires are still living on their ivory towers and sucking our blood. We could layoff 99% of these guys and the world would still move on happily. Can we say the same about any other profession?>>

Stock Market Rally-back Has Yet to Prove Itself Sunday, Nov 8 2009 

I will provide one stock pick for this week despite the market being in “rally-back” mode (see chart below).   So far, there is an overhead resistance wick up through the 50% retracement level and the 61.8% retracement level is near the median line (sloping up red line).

MDY_D -- MIDCAP SPDR

Here is a so-called “stock pick.”  It is Abovenet Inc (ABVT), a telecommunications company.  The chart indicates some choppiness, but it does have a “support wick” down through the 50 day moving average (red line), which is also an “attempted sell-off with no result.”   This stock also exhibited good relative performance, having not pulled back as drastically as the rest of the overall market.

ABVT_D -- ABOVENET INC

Finally, the updated model portfolio is posted below.  BPOP has been removed, but I have left the remainder.  As you can see, the natural resource stocks have done very well, especially HL which is up 52% after having been added September 4, 2009.  FCX is also up nicely, up 20%, having been added the same date at HL.

2009-11-6

Response to Time Magazine article Cover Story Saturday, Nov 7 2009 

I recently posted an excerpt from the Time magazine article cover story suggesting that American’s main retirement vehicle should be “retired.”  Here is a good response to that article.

 

Tips to Make Your 401(k) Work For You

Friday, 06 November 2009 11:06
by Christopher Davis – Provided by: Morningstar.com


It’s surprising there aren’t many calls in the press to ditch the automobile. After all, think of all the dumb things people do with them. They drive much too quickly and sometimes after drinking lots of alcohol. They even drive while sending text messages, putting on makeup, and reading the newspaper. The consequences can be dire: More than 40,000 Americans die in auto-related deaths each year, with nearly 3 million suffering injuries of some kind. Of course, it would be impractical and silly to outlaw the automobile. They are too intertwined in our lives and are beneficial in many ways. And it would be unfair to blame the automobile for its misuse.401K

Yet that’s exactly what’s happened in the case of another vehicle, in this case, the main retirement savings vehicle for most Americans: the 401(k). A recent Time cover story called for the retirement of the 401(k) itself, using the often-catastrophic losses investors suffered in the 2008 crash as the argument against them. But just as cars don’t cause accidents, there’s nothing inherent in a 401(k) that dooms you to a substandard retirement.

The Time article was trying to make a broader point that the do-it-yourself nature of the 401(k) makes retirement savers much more vulnerable to unpredictable fluctuations in the market, especially versus the company-provided pensions of yore. Although pensions aren’t perfectly secure either, it’s true that even investors with thoughtfully conceived 401(k) portfolios suffered heavy beatings in 2008. Those nearing or in retirement were dealt an especially tough blow as they faced living off a much-smaller nest egg and because, unlike younger investors, they don’t have as much time to recoup their losses. (If you find yourself in this unfortunate spot, click here for some advice on how to cope.)

Regardless of its shortcomings, though, the 401(k) is probably here to stay. And contrary to the impression provided by the Time article, using one successfully isn’t a lost cause. Here are a few tips on how you can make your retirement plan work for you.

Save More
The Time article does make one claim few can dispute: Americans don’t save enough for retirement. And, of course, it doesn’t help that over the past decade, stocks have gone nowhere, just like most investors’ 401(k) balances. Fortunately, there are some good reasons to believe that the next decade for stocks may be better than the last (long periods of subpar returns historically have been followed by long periods of above-average ones), which will give 401(k) accounts a boost. But you can’t rely on the market to do all your heavy lifting. If stocks and bonds don’t provide the return you need, you’ll have to fill in the gap by saving more.

Of course, saving more can be easier said than done, especially now, with so many households strained by high debt, stagnant incomes, and unemployment. If it’s not possible to change your savings patterns dramatically right away, start small. You can pledge to increase your savings rate by a percentage point (or more) every year, for instance. If your 401(k) plan has an option that automatically increases your savings rate on an annual basis, take it. The easier you make it to stay disciplined, the more likely you’ll achieve your goals.

 

Originally posted at: http://www.learningmarkets.com

Bull Trap Market…You Were Forewarned! Saturday, Oct 31 2009 

To be prepared is half the victory.  To be forewarned is to be forearmed.  Do not take lightly the warnings of a volatility reversal.  Two weeks ago, only one stock was added to the model portfolio, and I warned of a choppy market ahead, and a week later I warned of an impending volatility reversal, and a breakdown came two trading days later on Tuesday (see below).

Despite last week’s mess, one of the stocks added to the model portfolio went up over 17 points, which was well over 20% in one day, including the gap.  It ended up 13.83 (net) and the position is up 15.28% at Friday’s close.  That stock was MicroStrategy Inc. (MSTR).

A reoccurring theme has been to watch the model portfolio for signs of weakness.  Such weakness represents a possible sell-signal because we use it as a “market gauge.”  Such weakness has now reared its ugly head to an even greater extent than the week before.  Even apart from this microcosmic market inspection, a basic superstructural examination (market structure) shows over 3,000 sells to 200 buys.  This is not a good ratio.  Look at one such structure, the MDY (Midcap SPDR) that broke down below the trend line (also a channel line) on Tuesday of last week.

MDY_D -- MIDCAP SPDR TRUST 1Depending on your time frame and your investment strategy, many of your positions should have been stopped out.  I am posting the model portfolio for purposes of illustration (some should have already been stopped out.)   We are not currently proposing any new buys.  Also depending on your strategy, perhaps half of the winning positions should have been sold after a 15-20% gain.

Portfolio 10-30-09 - Many have been stopped out.The “Cash for Clunkers” U.S. Government program cost taxpayers $24,000 per vehicle sold per Edmunds.com data.  Can you imagine the government waste waiting for us with the upcoming “health care overhaul.”  For more Halloween Fun, visit:  http://www.cagw.org

The bond market never did believe in this equities rally all summer.  Now we will see if they were right.  Is our economic “recovery” built on rock or straw?  Economic vapors, smoke and mirrors, economic stimulus, government waste, government debt, taxpayer burden….doesn’t look too promising, or stimulating.

Market Could Be Vulnerable; New Stock Picks: PWRD, MSTR Sunday, Oct 25 2009 

PWRD -- PERFECT WORLD CO LTD, Daily chart

PWRD -- PERFECT WORLD CO LTD, Daily chart

MSTR -- MICROSTRATEGY INC, Daily chart

MSTR -- MICROSTRATEGY INC, Daily chart

Updated Model Portfolio

Updated Model Portfolio

Last week I implied there might be a choppy market ahead.   To illustrate this most graphically, I am posting a 30 minute line chart of the SPY (below).  Please pay attention this week to market conditions.  If there is continued weakness, a major market reversal in the form of a intermediate term, or even long term reversal could take place.

Remarkably, the model portfolio held up very well last week, and in some cases the positions actually gained momentum (see SFSF).   In other cases, such as YONG (which experience about a 20% pullback) there was a volatility reversal, and yet maintaining gains.  Using YONG as an example, do NOT let a winner turn into a loser,if you can help it.  It’s up to you to do individual research on these companies.  Yahoo!  Finance is free, or you may have a subscription service that you prefer.

SPY_30 -- SPDR TRUSTMy purpose for this blog is not to go into any details about the fundamentals (financials) of the companies that are placed in the model portfolio.  In fact,  I don’t even tell you what they do.  This information is easily obtained, and my intention is to accomplish my purpose for this blog with as little writing as possible.

There will be more writing (most weeks) about news that affects the 401k, and about the general philosophy of maximizing your 401k (or other retirement accounts).    Most “newsletter” writers like to write a lot of stuff.  I am doing things a little differently here.  The returns are taken very carefully, and if you read back in previous post you will see that the model portfolio is also a “market gauge.”  In fact, you can search this blog for the word “gauge” and you will find that very post!

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