Thread: How We Made 20.5% In 3 Months With Carl Icahn

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  1. #11

    Default December 12, 2013 ? Quote of the Day

    ?We are one budget deal away from being the hot spot of the world. Europe is in the toilet, China?s growth has fallen down, and the Middle East is going backwards. We have a lot of potential for fracking and innovation. If we can prove our nation is governable, we will be the golden spot in the world,? said David Brooks, a conservative columnist for the New York Times.
  2. #12

    Default Barchart.com's Chart of the Day - Altisource Asset Mamagement (AAMC) for Dec 11, 2013

    The Chart of the Day is Altisource Asset Management (AAMC). I found the stock by sorting the All Time High List for the frequency of new highs in the last month and it was right near the top of the list. The stock is off the charts and in the last year went from 15.00 to 1005.00!

    The company provides portfolio management and corporate governance services to Real-Estate Investment Trusts and other real-estate portfolio-driven entities. Altisource Asset Management Corp is based in the U.S. Virgin Islands.

    This is a 1 year chart:
  3. #13

    Default Should You Buy HP's Stellar Rebound?

    When the Dow Jones Industrial Average was reformulated in September, former technology leader Hewlett-Packard (NYSE: HPQ) was quietly replaced. It was yet another tough blow for a firm that is on track for its third straight year of sales declines. CEO Meg Whitman, who was just celebrating her second full year at the company's helm, could not have been pleased.

    But Whitman is surely getting the last laugh. Because against the odds, Hewlett-Packard has turned out to be one of the top-performing tech stocks of 2013. Shares have doubled in value, putting the S&P 500 Index's 25% gain to shame. More than $25 billion in market value has been added, and Whitman has less need to worry about job security.
  4. #14

    Default Profit From Health Care And Big Data With This Unloved Stock

    Data sets are getting larger and larger, and there's a lot of useful information just waiting to be made sense of. Nowhere is this truer than in the health care industry.

    Different hospitals have different platforms for managing data, which makes it exceedingly difficult to exchange information. Although it has been a slow process, the U.S. is moving toward a health care market that provides care more efficiently. Part of this includes implementing electronic health records and managing hospital costs.

    The American Recovery and Reinvestment Act allocated about $20 billion for electronic health records. This portion of the act offers financial incentives to hospitals and physicians to adopt and use health care information technology. The other positive is that many organizations face penalties for non-compliance, starting in 2015.

    With all this "reform" coming to the health care industry, one of the best ways to invest in the coming health care data boom is Allscripts Healthcare Solutions (Nasdaq: MDRX).

    Yet the stock hasn't been all that great to investors over the past couple of years. Thanks to a botched acquisition, MDRX is still down nearly 50% from its 2007 highs. The multi-year pressure was a result of the 2010 acquisition of Eclipsys that proved to be more trouble than it was worth.
  5. #15

    Default General Motors (GM) Up, Costco Down, Provisional Budget Deal Reached

    Stocks were headed slightly lower on Wednesday after the Federal Reserve announced they have reached a provisional budget deal on Tuesday evening. The deal will end the back and forth deadlock between the two sides by setting new spending levels, plans for reducing the deficit and relief from the spending cuts. The deadline for reaching an agreement was this coming Friday. House Budget Committee Chairman, Paul Ryan, said, ?This agreement makes sure that we don?t have a government shutdown scenario in January. It makes sure we don?t have another government shutdown scenario in October. It makes sure that we don?t lurch from crisis to crisis.? President Barack Obama had this to say of the progress, ?This agreement doesn?t include everything I?d like ? and I know many Republicans feel the same way. That?s the nature of compromise. But it?s a good sign that Democrats and Republicans in Congress were able to come together and break the cycle of short-sighted, crisis-driven decision-making to get this done.?

    Shares of Costco Wholesale Corp were trading lower after the company announced higher-than-expected operating expenses took a toll on their sales. The company said their operating expenses were up 5.5% to a grand total of $24.3 million, while general and administrative expenses were up 7.2%. Profits rang in at $425 million, or 96 cents per share. This was up from $416 million, or 95 cents per share last year at this time. Analysts were expecting the company to come in with earnings around $1.02 per share. Sales were up 5% to $24.47 billion, also below analysts expectations of $25.25 billion. Sales were up 3% at stores open at least a year. Analysts had been expecting this data to come in around 3.54%. Ken Perkins, president of Retail Metrics, said, ?Costco sales have been up and down this year and were hurting by falling gas prices.? He continued to say that the company has missed same-store sales expectations for six of the last 11 months. ?They?ve had real strong sales over the last five years so their comparisons are more difficult,? Perkins said.

    Shares of General Motors (GM) were trading higher after the company announced they would be putting a halt on manufacturing cars in Australia due to high cost by 2017. The company said that an incredibly strong currency is a key factor in the decision. The company will be closing their Holden plants in South Australia and Victoria states. Mike Devereux, General Manager at GM, said, ?No matter which way we apply the numbers, our long term business case to make and assemble cars in this country is not viable.? The manufacturing sector in Australia currently employs about 921,000 people. This has shrank nearly 10% over the last decade. Imports are becoming more competitive in the country as the Australian dollar rises. Stephen Clibborn, a lecturer in work and organizational studies at the University of Sydney Business School, said, ?If the automotive sector leaves then that?s a sector of manufacturing in Australia that has been a source of innovation and skills that has spilled over to other forms of manufacturing in Australia.?

    That?s all for the day.
    All the best,
    Jack Aubrey, Oakshire Financial
  6. #16

    Default Executive Comp reaches Ludicrous Speed

    Not a hater, just putting it out there.

    The Atlantic?s Matt O?Brien canvassed some of the top financial writers out there for their favorite charts of 2013 or the ones that tell the story of this year best. By my count, nearly a third of these charts dealt with economic unfairness in some way, shape or form.

    My favorite of the bunch ? for it?s absolute lunacy ? was from Bloomberg?s Mina Kimes, CEO Pay vs Real Minimum Wage in the restaurant industry ? just in case you thought Pat Bagley?s cartoon above was an exaggeration?
  7. #17

    Default Wednesday links: not all risks

    You can keep up with all of our posts by signing up for our daily e-mail. Thousands of other readers already have. Don?t miss out!

    Quote of the day

    Eric D. Nelson, ?Enlightened investors know that not all investment risks are worth taking.? (Servo Wealth)

    Chart of the day
  8. #18

    Default The Warning Signal That Predicted Apple's Crash... Before It Happened

    If you ask most people, they will say there are two types of people that put money in the stock market.

    There are "investors" -- those who put money to work in fundamentally sound companies for the long term. Then there are "traders" -- those who buy stocks for a short-term gain, without much concern for the actual business.

    The reality isn't as clear cut. You see, if you aren't using the principles of both investing and trading, then I think you're limiting your returns and increasing your losses.

    But it's one thing to tell you this. I want to prove it to you with one of the most widely-followed stocks of the past decade -- Apple (Nasdaq: AAPL).
    You're no doubt familiar with Apple. You might have even owned some shares at some point. Maybe you still do.

    Apple is one of the most fundamentally sound companies on the planet. For years, the popularity of iPods, iPhones and its computers caused earnings and cash flow to soar. Since 2003, the company's annual revenue has risen from $6.2 billion to $170.9 billion.

    Meanwhile, until very recently, Apple carried no debt. Instead, it boasts a $145 billion cash pile. That's enough cash to pay every man woman and child in the United States $460.

    And if you were an investor focused only on Apple's fundamentals -- a strong company with a pristine balance sheet that saw earnings soar -- you made a fortune. From 2003 until its peak in 2012, Apple's stock returned more than 9,661%.

    If you focused just on fundamentals, however, the joy of owning Apple ended in September 2012. Back then, the stock hit an all-time high near $705 per share. Sure, the company was still making money hand over fist and was among the strongest firms on the planet. That didn't matter. Neither did the fact that Apple initiated a dividend to return billions of dollars annually to its investors.

    Since its September 2012 peak, the stock has fallen 26%, despite the S&P 500 index rising 23.5% since that time.

    But if you used a few simple trading signals, you could have avoided that drop altogether.

    To be more specific, I am talking about "relative strength."

    If you've never heard of relative strength, don't worry. It's simple to understand.

    Relative strength is found by calculating the percentage price change over the past six months for every stock and ETF. You then sort these changes from high to low and assign the highest value a relative strength rank of 100 and the lowest value a rank of 0.

    Every stock is assigned a rank based on where it fits into that range. I like to use 70 as the limit for buys and sells. If relative strength is greater than 70 (meaning a stock is rising more than 70% of the market), the stock or ETF is a buy. I sell whenever the rank falls below 70.

    You can see Apple's relative strength charted below its price in this graphic:
  9. #19

    Default Bullish Sentiment is Now Officially Embarrassing

    It was much easier being an optimist before everyone else came around. As I said the other day, I no longer no what to think at this point (see: Now What?).

    The data is all more constructive ? Bill McBride (Calculated Risk) thinks we?re on the cusp of a major lift this coming year. But the expectations have already run off to the races at this point. Even the black swan fetishists have dropped the black nail polish routine and crawled out of their Recency Effect caverns and spider-holes.

    And so we?re left with a sentiment bubble ? if not fully formed then certainly one in the making. It?s like a the adrenaline surge people get from near-death experiences, a mass realization that things are turning out okay despite half a decade of misery and trauma. It?s almost sexual in its urgency, its intensity.

    Here?s Peter Boockvar of the Lindsey Group on this morning?s spike in bullishness, which is now totally embarrassing and berserk:

    Investors Intelligence said Bulls rose again to 58.2 from 57.1 and is just shy of the highest level since October 2007. Bears remained unchanged at 14.3, the lowest since 1987. II said the 4 week average of bulls divided bulls+bears is the highest since at least 2004 and said ?out of the previous twelve instances over the past ten years when this indicator formed a peak in overbought territory there has been just one weak signal and even then a correction came, just several weeks later. Each correction was of the magnitude of at least 5%.? For another comparison, at the current 4 week average read of 79.5%, it compares with about 73% in October 2007.

    ?and the chart, via Greedometer, who is unapologetically calling this a bubble:




    quoth the blogger:

    If you don?t see this bubble, you?re probably one of the following:

    - a long-only equity fund manager
    - someone that sells to long-only fund managers (or needs them on your show)
    - you work in a senior position at the Fed
    - you are visually impaired
    - some combination of the above.

    Josh here ? I gotta tell you, a 10% whoosh down sometime soon would be as welcome as rain in the desert. We?re out of the only petrol that makes the market?s motor hum constructively ? Fear.

    Read Also:
    Now What? (TRB)
    Advisors hit new all time record for bullishness. Beware? (Greedometer)
    Update: Looking for Stronger Economic Growth in 2014 (Calculated Risk)


    The Reformed Broker
  10. #20

    Default This $200 Billion Hedge Fund Is Big On These 2 Stocks -- Are You?

    I'm often asked how I come up with a consistent stream of investment ideas. There is really no single answer to this question.

    I have been immersed in the financial markets since my first trade back in 1990. Since that time, my investing library has grown so large that it has overwhelmed my bookshelves and spread into attic storage boxes. I am also a voracious reader of the financial media, reading several magazines and newspapers on a near-daily basis -- not to mention subscribing to real-time news services to stay up on what's happening.

    While my investing library has provided the foundation, and the daily financial media torrent turns the knowledge actionable, my favorite fresh idea source is other investors. New ideas can come from anyone, from the most naive beginner to the most sophisticated hedge fund manager and everyone in between. This is the reason I make it a point to talk to every trader and investor I meet about what's working and what's not working in their investing.

    Another way to learn from others is by following the big-money players.

    There are several large hedge fund managers who have earned my respect, and I watch their every publicly known investment. Fortunately, large money managers are required to file a Form 13F with the Securities and Exchange Commission on a quarterly basis disclosing their equity holdings. By keeping track of these filings, investors can glean profitable ideas as to what stocks these players are buying or selling.

    One of the most respected hedge fund managers in the world is Israel Englander, who operates Millennium Management. Millennium has more than $198 billion of gross assets; gross asset value refers to the total value of all assets under management, including leverage. Using this measure, Millennium is by far the largest hedge fund on earth. As a comparison, the next largest funds by gross assets are Bridgewater, with just under $140 billion, and Citadel, with $107 billion as of April.

    To put these numbers into perspective, they are larger than the annual GDPs of many countries. It's important to keep in mind, however, that when leverage is not included, Millennium has just under $20 billion in assets.

    Calling itself a global multi-strategy opportunistic fund, Millennium was launched in 1989 with just $35 million. The fund has a relatively unusual business model: Englander allocates capital to teams of traders who invest it to the best of their abilities. Traders can remain on the team as long as they're profitable. But as soon as a certain amount is lost, the trader is fired. In this regard, Millennium is often thought of as a trader of traders.

    Most interestingly, Englander and his head managers rarely discuss investment themes or strategies with the actual trading teams. He prefers to give them autonomy to follow their own ideas. This team approach guarantees diversification and uncorrelated returns, as each team uses its best ability to outperform. In addition, Millennium does not charge the traditional fixed management fee; rather, it simply passes the actual costs along to the investors. Englander believes that having investors directly involved with the true costs of running the business, rather than paying an arbitrary fixed percentage, is truer to the original entrepreneurial spirit of hedge funds.

    Here's what I found when I drilled into Millennium's holdings:

    The firm increased its short position in the SPDR S&P 500 ETF (NYSE: SPY) by 576% last quarter. This position now takes up 1.88% of the fund's portfolio. I am not overly alarmed by this move, since more than 15% of the holdings remain long on SPY. However, it is important to note that Millennium decreased its long position in this exchange-traded fund by 52% during the quarter. While I don't think this is signaling a basic macro shift from bullish to bearish just yet, I will be observing the next filing carefully.

    Millennium's No. 1 single stock holding is PPL Corp. (NYSE: PPL). The fund owns more than 8 million shares and increased its ownership by 73% last quarter.

    PPL is an energy and utility holding company in the U.S. and U.K. The company boasts a market cap of nearly $19 billion and trailing 12-month revenue of just more than $12 billion. The quarterly gross profit margin is more than 61%, and the company currently offers a 4.9% dividend yield.

    Clearly, the traditional steady dividend payouts of utility companies are an attraction to Millennium. (Remember, the dividend strategies Amy Calistri shares in her Daily Paycheck advisory are effective no matter the size your portfolio.)

    The technical picture shows the company has set up in a clear trading channel. The price has consolidated between $29.50 and $31 on the weekly chart.

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