CapitalSource, Inc. (NYSE:CSE.DL)

CAPS Rating: No stars

The Company is a specialized financial company which provides senior and subordinated commercial loans, invests in real estate, and engages in asset management and servicing activities.


Player Avatar dduncanm (< 20) Submitted: 9/1/2009 6:46:45 PM : Underperform Start Price: $3.63 CSE.DL Score: -242.06

Don't be fooled by CAPS ratings. As shown by the chart, CSE has declined 70% while the S&P has declined 20%. This occurred even though CSE CAPS rating was 5 stars. It appears that the high ratings are trying to build up the price so current holders can then dump stock, or an attitude of "I own it so it must be good".


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Member Avatar LurkyLurky (99.83) Submitted: 1/26/2010 2:07:04 AM
Recs: 0

Since when does a CAPS rating build up the price of a stock? I haven't been hanging around CAPS for a while, but it's hard for me to believe it has become a market mover.

CSE was a longtime recommendation of the Motley Fool subscription newsletter Income Investor. It was recommended as a stock to buy. It looked like a good deal--and the deal seemed to get better and better as the stock price kept getting haircuts. Of course, we didn't realize at the time that most American financial stock prices were going to plummet because the industry was a house of cards built with derivatives and such.

I think that when a TMF newsletter recommends a stock, many people give that stock the thumbs up in CAPS. That's not a pump and dump scenario, and it may not reflect ownership of the stock, either. Also keep in mind that people don't necessarily change their CAPS stock picks when the stock no longer looks so good.

Member Avatar LurkyLurky (99.83) Submitted: 1/26/2010 2:27:14 AM
Recs: 1

Upon further reflection, I think I see your point. If I own something, and am hoping the price will rise, I am loathe to give it the thumbs-down in CAPS, even if I no longer think it's a good investment. I see what you're saying, there.

Some of us have a hard time knowing when to sell, thinking "If I hold onto it, maybe I'll get my original investment back," etc. Because if we would pick it as a thumbs-down in CAPS if we didn't own it, that means we should sell, right? [I'm actually thinking of another stock, not CSE, as an example of this :-) ]

Member Avatar eaglett101 (48.86) Submitted: 12/21/2010 1:04:24 PM
Recs: 0

In one of the new letters I recieved the statement was made that when a stock loses 30% you should seriously think about cutting your loses. We have several stocks with the hope that the gains are larger than our loses. I have been attempting to apply this and was lucky enough that I bought CSE on the down and sold when I broke even when it gained to one of my original purchases.

Member Avatar DNAstock (< 20) Submitted: 2/23/2011 7:17:00 PM
Recs: 0

Boy, were you wrong!

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