Daily Market Watch - Week of 4/20/2009

[billhart22]

Well - if you guys are into the small stocks - I've been in DKAM - which started my foray into "speculative trading" - of which I no longer am. Its a booze distributor that had the idea of linking "icons" with different alcohols. They started off with Trump vodka. I didn't buy until I saw it in the stores here in San Diego. Problem is, there wasn't a lot of advertising, so now I only see it at say Ralph's in more high end areas. I don't drink these days, so I can't comment about the bars.

So the deal is, they do have money troubles - originally they had to pay Trump no matter what. Now they go in as partners. So I got sucked in via message boards and what not - but I didn't put anymore capital in that I could afford to lose - usually I have the stops on pretty tight, have patience, try to catch the middle of a swing. If you look on a weekly/monthly chart - that spike up to $3.50 happened on the hype when they shipped the vodka to the distributors. Earnings weren't that great and they had to dilute after to pay off debt. They may be debt free. I was up for a while, but since it wasn't a lot of money, I let it go down. Then I averaged a few times to get to 0.40 ave. It's held steady for a long time now. The previous spike to 0.60 is when they got Dr. Dre signed on for a cognac. But the product still hasn't come out.... so investors are worried, but as usual, many are looking for the big bucks... not me, I'm waiting for the next pump and dump. And, I'm laughing, cause I almost sound like I'm pumping it. But, they signed on Kid Rock for beer. http://www.drinksamericas.com/

I saw the michigan brewing company put out the release, and there was mention on the kid rock site. Today there was actually a long legged doji printed on the charts - so I may adjust the average to 0.27 by buying some at 0.15. That way I can break even on the pump and dump, and walk away.

Since I found my interests are more in TA, rather than the news, SEC filings, etc, I'm not much into long term or speculative trading, so I just want to get out. But you guys who may understand that stuff, may be interested in that one. It's not a pink, but on the OTCBB.

I wouldn't recommend anyone get involved to tell you the truth - but if you know what you are doing... it is a real company - I've bought the products.

Damn - I can't believe I wrote all that. Anyhoo - do your own dd, there is a decent message board on it at ihub, but it does have its pumpers.

There's my pseudo pump, for a pump and dump, I want to dump

I"m sure it will go to the moon after my sell. hahaha.

Mine are the ones that double after I dump them!! That is my line! Just kidding....good insight, Dr..

BTW, I like long explanations...then I don't have to second guess. I am a long writer also, usually. I try to get all of my thoughts out also. Keep it up!


Bill

[billhart22]

I really appreciate all of everyone's help and comments. I research many hours a day and sometimes it is really tough and time consuming, however, if you are into pennies and such there is a really good site. I will give it to you here now in case you haven't been there before. It is http://www.allotcbb.com. If you find anything interesting there, please post it here to share with others.

I thank you,

Bill

[billhart22]

Damn...Dave, you think you are bad....I am a chatty Cathy.....

Right now OCNF is at 1.07....you cannot beat that with a stick, even if it goes down lower...great price, good stock.

I believe the market will keep dumping on a frequent basis, so it will become a lot more volatile before setting into a regular pace, so there will be opportunities like this for a period of time.

Also, it could take a big dump. The government and its tongue is lethal. News is a killer.

But at 1.07, OCNF in my determination is a good thing. I could be totally wrong, so don't follow my simple advice, but take a look at a month, six month and year chart and then make your own decisions.

Have a great night,


Bill

[Dr. Dave]

Bill -

Did you ever sign up with John Lansing's site in the past? He had a message board and one of the sections was for "Chatty Cathy's".

He call's the talking heads on CNBC "Pollyanna's" - cracks me up.

Well, I have the gains I have from SIRI and then whatever I get out of DKAM to play with on either SIRI or other under the buck stocks. I'm trying not to get sucked in to where I'm playing with those more than trading what I know... but it is fun.

I tell you the one thing I don't like about having DKAM in my portfolio is. I log into my account. I see I'm up big for the day, then I go to look at my stocks, and as my eye just catches the light, I may see a bunch of red... then I see.. oh, DKAM is up 4 cents, up 20%... then I'm like - damn thing tricked me again... I thought my portfolio was actually up. DKAM will be down again here in 5 mins. Hahaha.

[billhart22]

Dave,

I think Newman should sticky that options thread. It is so informative. I will have to re-read it about 20 times to glean your knowledge out of it.

I have been looking around for some fruitful stocks and may have some. They are way out of my sector, but are just kicking ass and all are going up fast. I am amazed at the quickness they are gaining.

I will get back on to those after I invest...just kidding..I will give them to my subscribers...(just kidding about the subscribers). There are a few within the 1 to 2+ area that are really good from an initial look. The rest are in the 30's.....which is beyond my means to be productive.

I was educating myself on options today and then you posted about options and blew the top of my brain off! lol That is a good thing. If I want to participate in options, then I want to understand them at a post graduate level. You really opened my eyes up to that...thank you!

What I was studying was very rudimentary, albeit, it was informative. I was opening an account for options practice when they wanted to know my whole life history and canceled it. It really pissed me off. They want to know all of your total assets, liquidity, and net worth. (Optionsexpress.com).

I was looking for a free practice account, and they will give you one after you open an account.

After that, I went to my broker, Scottrade, and looked and it wasn't quite so harsh, but they want a lot of information, so I just canned the whole project. If I find value in what the government requires to place options orders, then I will...until I understand options a lot better, then it is not anybody's business of what my net worth is. (at least in my mind).

I have done options orders in the past, but that was before online brokers. When I was in the stock market before, I used to get on the phone, talk to my broker and let him handle it for a ridiculous commission. That was the way it was done then, unless you wanted to pay $300 a month for a live ticker machine in your house. Even with the stupid machine you still had to call the broker to place an order. It was really retarded looking back. How the hell it was interfaced I don't know, but it was available. That is beyond my comprehension. It probably had a 30 minute delay. I couldn't afford it for the amount that I had invested so I negated.

I used to keep a chart of my stocks on the kitchen wall and would call in to a broker every day for the closing price...they would challenge me as to whether I had an account with them or not before they would give me the price. I subscribed to the Wall Street Journal and Barrons (only paper then and a day late). Times have changed. Take the price of a Coke...my Dad used to get it for a few cents...I have paid up to $1.50 depending upon where I am at the time.

So all in all, we're just another brick in the wall. (I hate that thought...it reminds me of the movie "Brazil")

Have a great evening,

Bill

[billhart22]

Chapter 11 yes, and taking a month or two off yes...but a damn fine stock long....Just MHO...time for speculators to get in now. Of course I could be wrong, lol It really takes a little investment to make it climb like a mad man. Money invested talks big with this stock and it climbs and vice versa...Just some thoughts...do very DD (due diligence) and make your own decisions about it.

Have a great Sunday!

Bill

[Dr. Dave]

Dave,

I think Newman should sticky that options thread. It is so informative. I will have to re-read it about 20 times to glean your knowledge out of it.

I have been looking around for some fruitful stocks and may have some. They are way out of my sector, but are just kicking ass and all are going up fast. I am amazed at the quickness they are gaining.

I will get back on to those after I invest...just kidding..I will give them to my subscribers...(just kidding about the subscribers). There are a few within the 1 to 2+ area that are really good from an initial look. The rest are in the 30's.....which is beyond my means to be productive.

I was educating myself on options today and then you posted about options and blew the top of my brain off! lol That is a good thing. If I want to participate in options, then I want to understand them at a post graduate level. You really opened my eyes up to that...thank you!

What I was studying was very rudimentary, albeit, it was informative. I was opening an account for options practice when they wanted to know my whole life history and canceled it. It really pissed me off. They want to know all of your total assets, liquidity, and net worth. (Optionsexpress.com).

I was looking for a free practice account, and they will give you one after you open an account.

After that, I went to my broker, Scottrade, and looked and it wasn't quite so harsh, but they want a lot of information, so I just canned the whole project. If I find value in what the government requires to place options orders, then I will...until I understand options a lot better, then it is not anybody's business of what my net worth is. (at least in my mind).

I have done options orders in the past, but that was before online brokers. When I was in the stock market before, I used to get on the phone, talk to my broker and let him handle it for a ridiculous commission. That was the way it was done then, unless you wanted to pay $300 a month for a live ticker machine in your house. Even with the stupid machine you still had to call the broker to place an order. It was really retarded looking back. How the hell it was interfaced I don't know, but it was available. That is beyond my comprehension. It probably had a 30 minute delay. I couldn't afford it for the amount that I had invested so I negated.

I used to keep a chart of my stocks on the kitchen wall and would call in to a broker every day for the closing price...they would challenge me as to whether I had an account with them or not before they would give me the price. I subscribed to the Wall Street Journal and Barrons (only paper then and a day late). Times have changed. Take the price of a Coke...my Dad used to get it for a few cents...I have paid up to $1.50 depending upon where I am at the time.

So all in all, we're just another brick in the wall. (I hate that thought...it reminds me of the movie "Brazil")

Have a great evening,

Bill

Bill -

Go to the Chicago Board of Exchange - You can set up a practice account there I believe. It's sponsored by TOS (the Think or Swim) platform (I hope they haven't been bought out by TDameritrade (TOS that is) yet. TOS has tools to tell you what the time decay is, etc. The variables (I think they are variables, hahaha) are called the greeks -

This will make you sick:
http://en.wikipedia.org/wiki/Greeks_(finance)

I'm really digging google searches for the wiki -

I put in "greeks options wiki"

Awesome - anyway, you surely don't have to be able to calculate that crap by hand - but the options pro's I used to chat with had either TOS tell them how much they would lose per day on their premium with say volatility, etc.
You can trade without it, but you have to get used to it. The decay will happen faster as you approach the expiration date.

Folks follow the VIX (volatility index - which had cleared a gap - yes, we even do TA on the VIX - but its rebounding. The vix rises as "fear" rises - downward stock prices. That being said, the major indexes are at a true decision point. My money is in on the downside, but since we are at the inflection point - I can bail out before I get burned if it heads to the upside. I gotta figure out how to insert charts, but go to www.stockcharts.com and look at the weekly chart of $VIX and compare it say to $SPX (SP500).

I also use scottrade as my main platform. The reason why they ask all that stuff is that if you write (sell) calls and puts to "open" - ie. you initiate the contract - you can lose a shitload - some brokerages will only clear people for buying puts and calls, since you can only lose 100%. There may be some laws on your income/credit too, as opposed to when you last traded options - not sure on that one - or some SEC rules... though, I'm not sure if SEC governs the CBOE (chicago board of exchange). ie. I know of one guy who got a 14000% gain in a day - it happened on the last day - options expiration - so that meant the options writer, or original seller likely hung himself.

If you sign up, you can't get around it at any brokerage - Scottrade approved me, and I"m no millionaire. They also take into consideration your investment experience, so you're good there - I think they even ask if you've traded options before. I don't know if they split the clearance - if memory serves, they don't allow anyone to write puts. Another brokerage I use had 3 levels of options clearance. I'm just in to buy (open) calls and puts - that's it, nothing fancy. I use a service - but had gone alone a few times - but likely won't anymore. The smart guys - who really are good traders are on the selling (to open) side - so it's tough to be the little guy buying them (to open). The sellers have time decay on their side so to speak, they just can't get the price wrong in the end. ie. each day the value of the contract increases (assuming the same volatility and stock price) as the expiration time comes. So its less risky on that end, but if they screw up - they are in a deep hole. All in all - options are good if you are a good swing trader - since you know (I use that phrase loosely, hahaha) when the momentum is coming. That or privy to some news - or have a gut that uses its feelings correctly!

you have to add the last ")" for that wiki page to come up - for some reason the software for this site isn't including it for the link.

[Dr. Dave]

Just before grad school around 1990 - I had been reading a bunch of magazines like Kiplingers, and read some stuff by Peter Lynch. I moved back into my parents house and worked a little while. I wanted to buy a block of shares in McDonald's. My plan was buy a block of their shares - about $33 a share (of course it's split a million times since) - so I saved up $3500.

Since I was still a kid so to speak, I kept chickening out to walk into see the broker at my bank. The bank had a branch at the grocery store, and I just never made the appointment. Then I meet this girl - who liked to go out a lot. About the time I finally got the nerve to walk into that bank branch, the girl and I were going to go out and I went to the ATM - insufficient funds.

I still know her, and next time I'm in New Orleans - I need to tell her that she owes me about a 300 K.

My plan was to buy MCD and KO - I eventually saved the money again, but by then, my stepdad said I need to get my own car.... oh well...

I would have done it in a second if I could have done it online. After the car, I started a drip into home depot - not too fruitful.

I wonder why seeing the broker freaked me out so much back then???

[billhart22]

Dave -

Back then I would have done the same thing..Why take the money and give it to a broker? I have a girlfriend now and I know this is going to cost a lot!

I am glad that I am finally past that stage in life.

I felt bad when I started getting AARP materials in the mail. Now, I am just waiting for the literature from crematoriums and the valuable services they provide.

[billhart22]

I still haven't checked the CBOE out yet. Maybe later this evening if I can find some time.

I will definitely get to it though. I have all the bits and pieces, now I just have to tie them all together, practice a bit and then start learning at the next level.

I can all ready see where it might be wise to just let somebody else handle the contracts for you. They are really interesting and time is the principal element (of course the money is too) of getting it done properly. When and if I get more comfortable then it may be another thing, but for now I just want to practice, and take your sound advice, plus your personal experience that you have conveyed on options.


Bill