Tuesday, August 30, 2011

Riding the Quantum (QTM) Train -- Again

By way of confession, I've indulged my bad habit of short-term trading again.  One of my favorite low price stocks, Quantum, dropped significantly during the recent market dips.  I bought at $1.85 on Aug. 22 and sold out yesterday at $1.97.  My purchase was based on several principles.  First, Quantum is volatile.  While this volatility could work negatively, it could also result in a quick bump up.  After the market dips, my instinct was that there would be a bump up.  Second, Quantum is worth more than $1.85 and was beaten down by the market crashes.  The corollary to this is that Quantumm, while Quantum might sink further in the near term, it was a safe investment long-term.  Third, Quantum is an acquisition candidate, giving me another way to win.  Fourth, I believe that for some time we will be looking at repeated and significant market dips and upward surges.  Why?  There is a lot of bad news that will keep hitting markets because the world economies are not in good shape.  Nevertheless, there are a lot of very powerful, wealthy entities both here and abroad that are invested in continuing to trade whatever economic conditions and these entities will produce surges.  There are also governmental forces which have a strong interest in keeping markets rising or at least stable.  These competing forces will continue to do battle for some time, since neither promises to run out of steam for the foreseeable future.  Did any of the aforementioned factors enter into my modest win on QTM?  1, 2, and 3, in my opinion.

Tuesday, August 16, 2011

Google and Motorola Mobility: Leaks?

After taking a very brief time to celebrate being right on my call that Google would buy Motorola Mobility (http://limbinvest.blogspot.com/2011/05/google-will-acquire-motorola-mobility.html), I began to think about recent events.  Motorola Mobility was inexplicably going up last week in the midst of the market's crash.  I thought nothing of it at the time, other than to tell myself that perhaps others were finally recognizing the value I had seen, even in the midst of chaos.  Now, however, the rise does seem curious.  I am not the only one to wonder if, perhaps, some folks knew about the acquisition in advance and acted on it:


Monday, August 15, 2011

Google (Goog) and Motorola Mobility (MMI): I Was Right

I'm always wary of the dangers of ego but I told you all about this one back in May:  Google will buy Motorola Mobility.  Only, I predicted a five year time horizon, not five months:


It's good to be right about something this big but you're only as good as your last pick, so I'm going back to my studies...  

Wednesday, August 10, 2011

Low Priced Stock Performance During Market Crash

Apparently, low priced stocks have performed quite a bit better than their peers in the recent dark days of the market:


Anecdotal (very) evidence of the low price anomaly. 

Monday, August 8, 2011

Google Revisited: I Sold

Like anyone else, I like to point out when I'm right (unlike many, I'll also point out when I'm wrong).  Here's what I said in a recent post about whether I should sell Google when it spiked to over $600/share:

I bought Google at $537 per share (after in an earlier life buying it at $247 and selling at $320 -- there is perhaps another lesson there).  As some of you may have noticed, Google has spiked dramatically to over $600 per share after reporting earnings.  I do believe that it's worth much more than $600 ultimately but it's tough not to sell it after the recent upswing because I think the world generally is in for more negative economic news which will once again depress Google. 

The bolded language has been validated.  I sold while Google was still at $615.  It's now at $547.  One for the win column but I am the last person to beat my chest.  Back to the desk...

Monday, August 1, 2011

Correlating Unemployment, TV Watching, Crown Media,and Hallmark

Consistent with my low price anomaly strategy (one among several, admittedly), I've been taking a look at Crown Media Holdings (CRWN), which operates the Hallmark Channel.  It's trading around $1.70/share, has a well-known trademark (courtesy of Hallmark itself), and has recently secured the services of a well-known celebrity in Martha Stewart.  These are assets I can understand at a price I like.  Thinking about Crown a lot led to a sudden curiosity:  has the elevated unemployment rate of recent years led to an increase in television watching?  Apparently, there is some evidence for this:


There is another thing I find appealing about the Hallmark Channel -- the generally innocent level of its programming.  I've been feeling recently that parents may soon start rebeling about the general slumming down of TV programming (and perhaps American life in general which takes some cues from TV).  See Miley Cyrus' tattoos or virtually any show on ABC Family for an example of what I'm talking about.  The Hallmark Channel has wholesome programming and a wholesome image.  Won't American families ultimately want more of this?