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Larry Cyna
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Mr. Cyna is an accomplished investor in the Canadian public markets for over 20 years, and has managed significant portfolios. He is a financing specialist for private and public companies, and has expertise in real estate and debt obligations. He has assisted private companies accessing the... More
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  • Gold Tumbles, Followed By Commodity Stocks Tumbling
    An Overview of Stock Market History, and Understanding the Gold Market

    Investors have felt the pain of a falling gold price, with withering losses in the value of junior commodity company share prices and gold stock share prices that dwarfs by multiples the decrease in the price of gold. How do you deal with this? This is what is happening, and this is what you have to do.

    The Fallacy of Fair Value in the Stock Market

    There are people that study the markets and pontificate on how the market values stocks fairly, and predicts the future of the economy, and all kinds of other nonsense. The truth is that the days of fair valuation of stocks are long gone as is the antiquated theory that the stock market foretells the future economy. To read the rest of this article and an explanation of why gold fell and what Wall Street did about it, please read ........

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Jun 05 6:30 PM | Link | Comment!
  • Apple Inc ($AAPL) Is Now A Profitable Short

    Whats-Hot-or-Not

    Periodically we publish our stock picks. Stocks that we like are "Hot" and listed below. OUr portfolio has returned 35.76% this year.

    Apple Computer ($AAPL) is Not a Hold


    When Apple was rising and reached $676.00, we suggested a short or buying Puts. Market exuberance was pushing Apple higher, and as it always does, the market trends until it far over reaches value. Apple eventually peaked over $700, but then started its inevitable return to earth. That call made us a lot of money.

    Sell Apple Inc (AAPL Nasdaq) (Recommended sell at $439.70)
    Apple defied gravity and hit a high of $705. Since it has trended on down-slope with the $400 level broken, sliding to a new low of $385. Yesterday a rebound on news of a proposed dividend to shareholders, a share buyback, and a massive debt financing.

    APPLE Will Falter
    Steve Jobs, the genius who rescued Apple, is no longer there. When a determined and visionary genius is no longer at the helm, a replacement is hard to find. Who would be willing to work in the shadow of a great man, except a lesser man? Can you imagine Steve Jobs living under the direction of another leader? He could not which is why he left his previous employment to do his own thing. He could not be replaced by someone already working at Apple, because no-one with that level of intellect and drive would follow someone else's orders. His replacement is not the quality of the man he replaced.

    Revolutions Fade
    Apple created a computer that was revolutionary. Others followed. Apple created the iPad, and others followed, then the iPhone. Each drove the company to dizzying new heights.

    But it's hard to keep revolutionizing the world. The mantle of innovation has passed and as the pipeline of products Jobs created reaches the market, the number of new revolutionary products following is thinning out.

    A Bigger Problem - Apple Has Money Offshore
    US tax law (see my blog of October 14, 2012) is written in a way to reduce the incentive for US companies to bring their profits home.. American companies span the globe and make large profits in many companies. But these profits stay offshore and are not repatriated, because to bring the money back to the USA involves paying a repatriation tax. So the money stays offshore. Apple has over $102 billion of cash offshore. So Apple decided on another route. They intend to give over $55 billion to shareholders thru 2015, and they intend to buy back shares. They hope to attract investors who are looking for yield and a share price.

    The problem is that Apple doesn't have sufficient money in the USA to fund these goals of share buybacks and dividends to shareholders. So rather than repatriate the money, pay the taxes, and then pay dividends, Apple is embarking on one of the largest bond issuances in history with staggered repayment dates. This avoids any massive debt repayment call at one time in the future, and locks in the low interest rates. On the other hand, it is pure folly. In 2 or 3 years or whenever, Apple will continue to have the repatriation tax issue hanging over its head, and in addition will have this enormous new debt to repay.Does anyone remember what happens when a company has less cash than it needs to repay its creditors? It is a foolish short term thinking solution. Steve Jobs is likely turning in his grave.

    Perhaps Apple hopes to bring out a new and revolutionary product that will carry on the glory years. Maybe a TV revolution, or eyeglasses that automatically connect to the internet, or a Dick Tracy watch? Unfortunately Google, Samsung and others are already competitors in researching these products. So in a competitive marketplace, Apple must make enough money from new products to fund these enormous dividends and buybacks, or else it finds itself needing to repatriate these offshore dollars. Likely it is postponing the inevitable, except worsening the situation.

    More Issues - Competition is Growing
    Google is after Apple territory, by bringing a core part of its Android operating system in direct competition with Apple with a feature called Google Now which is a downloadable app for Apple devices. Apple's advantage of controlling its users is about to be challenged. So invaders are on all sides, and Apple's defense is to take a company that has no debt, and bring on massive debt for the sole purpose of supporting its share price.

    A company succeeds because it has the best management, not because it has the best product, or the best anything else. Excellent management steers a course that brings success. That is what Jobs did. If you judge Apple's management today, you must judge it on the folly of its current decisions.

    Sell Apple or buy Option Puts. Use today's jump in market price which occurred as a result of the current bond announcement to take advantage of this temporary rise in stock value.

    Whats-Hot-or-Not - Historical Picks

    Feb 2/13 E Mini (ES - CME) June 2013 (Picked@13,947, sold @ 15,460, profit of 1,513)
    Feb 6/13 Tethy's Petroleum (TPL-TSX) (Picked@$0.74)
    Feb 10/13 Scorpio Mining (SPM-TSX) (Picked@$0.95)
    Feb 21/13 Medicago (MDG-TSX) (Picked@$0.54)
    Mar 15/13 EMED Mining (EMD-TSX) (Picked@$0.175)
    Apr 5/13 Detour Gold (DGC-TC, DRGDF on OTC) (Picked@16.60)
    Apr 11/13 Dynacert (DYA-TSXV) (Picked@$0.14)
    May 1/13 Apple Inc (NASDAQ:AAPL) (Sell@$452.70)

    Please sign up for our newsletter at cymorfund.com

    We may or may not have positions in the securities we name under 'Whats-Hot-or-Not'. Whether an investment is made in a particular security depends on many factors, including portfolio balancing, timing, cash and capital reserves, asset allocation and numerous other factors. Readers are advised to do their own research and decide in light of their own circumstances. Matters discussed contain forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially from any future results, performance or achievements expressed or implied.

    Tags: AAPL
    May 11 11:24 AM | Link | 1 Comment
  • Making Big Money In The Market Requires Patience

    Maximize Your Returns

    People make and lose fortunes in the stock market.

    Those more adventurous trade stocks with varying degrees of frequencies. They use trends, or signals, or technical analysis, or just guess and use their instinct as to whether a stock will rise or fall. The gain or loss is triggered when the stock is sold (if previously bought), or bought (if previously shorted).

    Others invest because of long term value. The investor expects the stock to rise in value because it either appears undervalued currently, or is expected to increase in value in the future.

    Other invest to get income, and buy dividend yielding stocks, or REITS.

    Investors using these and variations of these methods have varying degrees of success.

    A Different Way to Invest
    There is another way to invest. It is amazingly easy, and requires no specialized knowledge. It requires no advisors. It requires patience. Lots and lots of patience and little else.

    (click to enlarge)

    Courtesy big charts.com

    Examine the above chart which shows the Dow Jones average over several decades. It shows a distinct long term uptrend. But on closer examination, it shows another pattern. At numerous points along the way, the DJIA had dramatic falls in value.

    If you would have bought the simple average in September 1998, and sold it when it as soon as it stopped its meteoric rise, you would have made a lot of money.

    If you would have bought the DOW in February 2003, and sold it when it stopped its meteoric rise, you would have made a lot of money.

    If you would have bought the DOW in March 2009 and sold it when it stopped its meteoric rise, you would have made a lot of money.

    The examples abound everywhere. Whether you look at the DOW, or the TSX, or the Income Trusts, or any other sector, you will notice a similar pattern.

    Patience is the Key
    If you want to make big money, stay out of the market. Be patient. Whatever sector you like, will rise and sooner or later, will tumble on a temporary basis. When it tumbles, fear will pervade the market, and the losses will mount, as always. When the tumble is finished, buy that stock or that sector.

    Don't hold forever. Be happy with the big gain. When the rise starts moderating, sell. SELL. Take your cash and park it waiting for the next tumble. The next tumble will always come.

    Risk is Moderated, Gain is Maximized
    Pretty simple isn't it? Everyone knows this happens, but people can't sit and wait. The urge to put your money to work is overwhelming. The smart investor, does nothing but wait. Usually once or twice a year, a minor tumble will occur. Every 3 to 5 years a major tumble will occur. Be smart. Live easy. Live stress free and wait for that magic moment.

    We may or may not have positions in the securities we name under 'Whats-Hot-or-Not'. Whether an investment is made in a particular security depends on many factors, including portfolio balancing, timing, cash and capital reserves, asset allocation and numerous other factors. Readers are advised to do their own research and decide in light of their own circumstances. Matters discussed contain forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially from any future results, performance or achievements expressed or implied.

    The views expressed are opinions and are not investment advice. Persons investing should seek the advice of a licensed professional to guide them and should not rely on the opinions expressed herein. This blog is not a solicitation for investment and we do not accept unsolicited investment funds. This report is for information purposes only, and is neither a solicitation nor recommendation to buy or sell, nor an offer to buy or sell securities. We are not a registered investment advisor nor a broker-dealer in any jurisdiction. The information contained herein is based on sources which we believe to be reliable but is not guaranteed by us as being accurate and does not purport to be a complete statement or summary of the available data.

    Apr 25 8:45 AM | Link | Comment!
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