June 20, 2008 –
This morning the market slipped hard, erasing the gains from the previous days. Today is the last day for options expiring this month to be exercised-Option Day. Over the past month, the market has been down quite a lot. That means that most calls will be out-of-the money, and most puts will be in-the-money. Therefore only the puts will be exercised. A put is an agreement that allows the owner of the contract to sell the stock at a predetermined price. If all of these puts are being exercised, there will be lots of people selling to the people who wrote the puts. Now I am not sure what people's motives are behind writing puts, but I am guessing that many put writers will sell the stock immediately after they buy it. This massive selling on every level of stocks, I believe has dragged down the market. [more]
April 14, 2008 –
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RELATED TICKERS: PRAA
This is my favorite stock. They are trading off their 52wk highs of $65 for no reason. They buy uncollectables from banks, credit card companies, and retailers for pennies on the dollar in hopes to use their collection agents to collect more than they paid. Their tract record is stellar, if you look on their 10-k, they typically regain their purchase price within 2-3 years of collection, but they continue to collect on the receivables for about 10 years. Their 10 year return on their receivables purchases is about 500% of the original purchase price. [more]
February 13, 2008 –
Day trading has such a negative connotation, and for a good reason. People who don't know what they are doing should not mess with it, it is VERY dangerous. I go to CAL right now and I am in the stock investing club. People found out about how frequently I trade my stocks in my portfolio and they all begin to team up against me, and not let me explain. I tell them that I have made 20% in the short term and they say "it only matters how much you keep" (which is true). I am sort of pissed (not really), so I will give my reasoning here. This is sort of my life story of investing, so go to the bathroom right now, I don't want anyone getting up in the middle of the story. [more]
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