Google and FaceBook
There will be great trades here..........
GOOG- Split and confusion over voting/non-voting shares
FB - Correct valuation. ( Can we predict the right entry point?)
Check your emails for strategy and price targets.
Saturday, May 26, 2012
A WSR Training Tool......A Key to Success.
Thank you for the feedback and the compliments. We have received numerous emails asking how our batting average is so high. I guess after a great day of working out, wonderful sunny day, and a party at the pool- we might let you in on a key to trading. First of all- God Bless Our Troops- Past and Present! This is Memorial Day Weekend. Don't EVER forget the ultimate sacrifice others have given so we can enjoy our way of life. Always remember and respect them! Always! We owe a tremendous amount to the parents and their sons and daughters who are/have been in the armed forces. Ourah!
Texas "No Limit" Hold'em. A crucial tool to learning how to invest and trade. Why? It teaches you the following:
1. Risk Management
2. Risk Management
3. Accepting and escaping losing propositions
4. Understanding market trading and betting patterns
5. Sticking/reversing during volatility for the payoff
6. Playing a game style that is most comfortable to your personality- Key
7. Understanding the bluff (media ) and the players ( analysts and institutions )
8. Trusting your instincts
9. Ability to understand luck and its place in your strategy with no emotion
0. Controlling your emotions and establishing confidence
As our readers know, Jesse Livermore was one of the greatest traders of all time. Now imagine his skills combined with the greatest poker players? Now add in current technology and the hiring trends at the largest institutions. You seeing the light?
In poker - it is crucial to learn the player's habits at your table. It is crucial to learn the habits of those that influence the market.
Have a wonderful and thoughtful Weekend!
Texas "No Limit" Hold'em. A crucial tool to learning how to invest and trade. Why? It teaches you the following:
1. Risk Management
2. Risk Management
3. Accepting and escaping losing propositions
4. Understanding market trading and betting patterns
5. Sticking/reversing during volatility for the payoff
6. Playing a game style that is most comfortable to your personality- Key
7. Understanding the bluff (media ) and the players ( analysts and institutions )
8. Trusting your instincts
9. Ability to understand luck and its place in your strategy with no emotion
0. Controlling your emotions and establishing confidence
As our readers know, Jesse Livermore was one of the greatest traders of all time. Now imagine his skills combined with the greatest poker players? Now add in current technology and the hiring trends at the largest institutions. You seeing the light?
In poker - it is crucial to learn the player's habits at your table. It is crucial to learn the habits of those that influence the market.
Have a wonderful and thoughtful Weekend!
Friday, May 18, 2012
Why we don't like FaceBook as an investment...
We have received many emails asking us what we have against the company. All social issues aside, we will talk about it as an investment. These views are our personal views and are no way a recommendation. Do your own homework.
1. Kids are fickle, volatile, and cost conscious- Our speculation is that the vast majority of its users are young adults and kids. They spend countless hours updating their "virtual images" and trying to increase their "popularity". It is the "cool thing" to do right now and it's free!
2. It is trading at more than 25 times trailing revenue and it is not fully determined exactly what are their earnings.
3. The risk of being able to monetize their users is huge. We don't think the majority of their users will adapt too willingly to fees or ads. A new "outlet" will attract the kids and FaceBook may not be so cool anymore.
4. The basic premise does not hold water. Eventually the "ideal images" and "perfect lives" portrayed by users will be seen as a pathetic excuse for attention. Susceptible to fad swing.
5. Lock-ups will expire, shares will increase. Potential sellers abound.
What would we pay for shares? 10 dollars.
WHAT WOULD CHANGE OUR MINDS?
1. They do claim 900 million users......that could be monetized.
2. A strategic shift into actually trying to "improve" society.
3. New technology
4. Strategic alliances
1. Kids are fickle, volatile, and cost conscious- Our speculation is that the vast majority of its users are young adults and kids. They spend countless hours updating their "virtual images" and trying to increase their "popularity". It is the "cool thing" to do right now and it's free!
2. It is trading at more than 25 times trailing revenue and it is not fully determined exactly what are their earnings.
3. The risk of being able to monetize their users is huge. We don't think the majority of their users will adapt too willingly to fees or ads. A new "outlet" will attract the kids and FaceBook may not be so cool anymore.
4. The basic premise does not hold water. Eventually the "ideal images" and "perfect lives" portrayed by users will be seen as a pathetic excuse for attention. Susceptible to fad swing.
5. Lock-ups will expire, shares will increase. Potential sellers abound.
What would we pay for shares? 10 dollars.
WHAT WOULD CHANGE OUR MINDS?
1. They do claim 900 million users......that could be monetized.
2. A strategic shift into actually trying to "improve" society.
3. New technology
4. Strategic alliances
FaceBook.....Who made money
The unprecedented marketing and spin put on the shares of FaceBook's IPO have made for a great payday for many participants. Who made the money?
1. Insiders - those that bought early and had a main role in the marketing of the shares. They sold a lot!
2. FaceBook employees
2. NASDAQ - huge trading volume and publicity
3. Underwriters - huge revenues and commissions
4. Retail Stock Brokers - How could any of their clients refuse to be so "lucky" to receive so many shares of a hot IPO? They couldn't get in on any of the hundreds of other deals that went up 50% or more the first day of trading; but, they were fortunate enough to get all they want of this issue.
5. CNBC and other media outlets - they pushed the story for weeks and increased their viewers and advertisement dollars from Wall Street institutions.
6. Large institutions who were informed ahead of time of the large retail demand
7. Countless others that had their hand in this huge "show".
Who may not make money?
I think you know the answer. You will hear all kinds of back-peddling, excuses, spin, etc.....They will now try to appear balanced in their opinions (they already made their money).
1. Insiders - those that bought early and had a main role in the marketing of the shares. They sold a lot!
2. FaceBook employees
2. NASDAQ - huge trading volume and publicity
3. Underwriters - huge revenues and commissions
4. Retail Stock Brokers - How could any of their clients refuse to be so "lucky" to receive so many shares of a hot IPO? They couldn't get in on any of the hundreds of other deals that went up 50% or more the first day of trading; but, they were fortunate enough to get all they want of this issue.
5. CNBC and other media outlets - they pushed the story for weeks and increased their viewers and advertisement dollars from Wall Street institutions.
6. Large institutions who were informed ahead of time of the large retail demand
7. Countless others that had their hand in this huge "show".
Who may not make money?
I think you know the answer. You will hear all kinds of back-peddling, excuses, spin, etc.....They will now try to appear balanced in their opinions (they already made their money).
Facebook Fizzle.......not surprised
WSR has been explaining this "hype and dump" scenario for the past few weeks. If you bought at the opening $43 dollars.....it is now $38. We warned you. You never want an IPO that the top 3 retail brokers smile as they make you feel "special" to get such a hot stock. Typical and predictable.
The FaceBook Deal Thoughts.....
1. It has the biggest retail investor interest ever!
2. Wall Street is making about 25% available to the average retail investor
3. Insiders are selling a large amount of shares
4. CNBC hype is in full swing
Predictions: 1.You will get the stock much cheaper
2. The fad will fade
3. Users will begin leaving once they try to monetize the site
2. Wall Street is making about 25% available to the average retail investor
3. Insiders are selling a large amount of shares
4. CNBC hype is in full swing
Predictions: 1.You will get the stock much cheaper
2. The fad will fade
3. Users will begin leaving once they try to monetize the site
Facebook Trade.....Completed
As we discussed a couple months ago, the market would trade up into the FaceBook IPO. The entire Wall Street spin machine has been gearing up for this event. Our plan was to sell before the IPO and go short. The plan worked perfect. We have covered our shorts today. You know our feelings on FaceBook. Stay tuned. Check emails for updates.
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