MGM

I've been laying low for a while without much activity, just watching things play out in Europe.  I made some money on PRIS but, once it shot up, I got out.  Too much volatility.  Only purchase since I last checked in has been MGM.  Bought it at $9.60 because I felt we were on edge of a positive news cycle at the time and I believe that investors are waiting to pour into casino stocks at the first sign of a turn in the economy.  Not that I believe the US economy is actually turning in any meaningful way.  In any event, MGM has been up to $10.50 or so but I decided to just hang in and now it's back down today to around $9.80.  I don't particularly love MGM but it was below $10 in the right sector, at the right time.  Now we'll see if I missed my window on it. 

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:

http://seekingalpha.com/article/286358-surprisingly-smaller-stocks-went-up-when-the-market-dropped?source=msn

Anecdotal (very) evidence of the low price anomaly. 

Low Price Anomaly: Cryolife

Here's another stock I liked so much that I bought it because it fits with my low price anomaly theory.  The company is Cryolife, which makes medical devices, is a leader in tissue preservation methods, and has developed other products such as surgical adhesives and foams.  It's low priced and, while in a competitive industry, it is a growth market.  It also has significant intellectual property.  I'm willing to wait until it is in the right place at the right time.

Low Price Anomaly In Practice: Quantum (QTM)

Here's a report on a low-priced stock I bought which paid off. Anecdotal to be sure but I've become an adherent of this so-called anomaly and will continue to report in on results.

Stock: Quantum (QTM)

Purchase Price: $2.79
Sale Price: $3.42
Holding Period: 54 days

Return: 22.58%

Low Price Anomaly

Here's an interesting link to an old article on how low priced stocks performed on the Johannesburg stock exchange: not well. So what? Well, it collects some papers on the U.S. stock exchanges showing that low priced stocks outperformed higher priced counterparts over time. My analysis of my own portfolios has led me to conclude that you're generally better off buying lower priced stocks. And I mean under $10, or better yet under $5. The phenomenon is apparently well known in the literature and it's called the "low price anomaly."

www.iassa.co.za/articles/045_1997_04.pdf