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Martin Vlcek  

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  • Nokia Starts A Feeding Frenzy [View article]
    FYI, JNPR reported earnings on 23rd AMC.
    Apr 25, 2015. 07:54 AM | 1 Like Like |Link to Comment
  • Nokia Starts A Feeding Frenzy [View article]
    Chris,

    Thanks for excellent investing ideas. I was long ALU for the China 4G orders and low valuation. Following the deal announcement I added just a very light hedging of the NOK exposure as I believe both ALU and NOK can move higher together within the year on undervalued Euro and ongoing EU QE. It's a pity ALU was taken over at such a low price. I believe the upside was higher. But politics probably played a role - saving the French jobs.
    Apr 25, 2015. 07:48 AM | 2 Likes Like |Link to Comment
  • Free Gold [View instapost]
    Bazooka,

    Sorry for the late reply. But I received all my SpinCo shares. I tested buying on different days of the last week of trading. Monday morning following the merger weekend, all SpinCo shares appeared in my account.

    The old PZG shares were converted into some temporary (virtual contract) CDE shares, so the margin requirements of my long virtual CDE stock and real CDE sold calls were not offset immediately. But in the evening on Monday, even the virtual CDE shares were converted to real CDE shares and the margins offset. I continue to hold the Spin co and CDE (CDE is covered with calls@$4, so I keep it for some time premium generation until the options expire)
    Apr 24, 2015. 12:27 PM | 1 Like Like |Link to Comment
  • Merger Arbitrage Forum (Though Any Arb Can Be Discussed) [View instapost]
    arbtrader, I agree this is a very risky bet that could go to zero, which will either be zero or nothing IMO. The question is how much of the bad outcome probability is already priced in. I am using option spreads to cut on the downside exposure I still see a positive expected value (weighted by probabilities of outcomes) and the risk/reward is positive in IMO. Given the political and economic cost for Germany of a Grexit is huge (stronger currency in the long run which would kill their export-driven miracle, plus opening the floodgates of debt defaults around Europe and around the world), I believe a solution will be found and debt maturities extended/interest cut, as opposed to a clear debt default/writeoff and ECB said it doesn't plan to change collateral rules for Greek banks. Merkew wants Greece in and no default, at least officially: http://reut.rs/1zUsFq0. And "ECB agreed on Wednesday to raise the cap on emergency liquidity assistance to Greek banks to 75.5 billion euros and did not toughen the conditions on collateral they have to present for funding, banking sources said". But the ECB stance is reviewed weekly and the whole Greece situation is changing every day and Greece clearly knows its position and will not give in too much territory IMO. The only goal now is to make it appear a win-win situation for both Germany and Greece for all politicians to save their face.
    Apr 24, 2015. 09:30 AM | Likes Like |Link to Comment
  • Merger Arbitrage Forum (Though Any Arb Can Be Discussed) [View instapost]
    FYI, ALTR fell nicely in the AH market today so I am considering reentering a bull call spread tomorrow which I closed earlier at a decent profit (INTC merger hopes - only hopes at this point really).

    NBG has also been a nice long play on this dip, from $1.06 to $1.18 but I already cashed in half of the gains for now following the temporary Greek meltup of the situation. Not a special situation I suppose, but clearly distressed with often changing sentiment without a real fundamental change. Talk about emotional markets. One new article or comment by some EU/Greek official moves the stock by 10-20% in a matter of days.
    Apr 23, 2015. 10:57 PM | Likes Like |Link to Comment
  • Still Able To Purchase $1 For 40 Cents: CF Industries [View article]
    Eric,

    Thanks for a wonderful analysis of CF. I see the long-term rise in natural gas prices as a risk, if the company hedges too little. On the other hand, I am long BXE (a natural gas play and perhaps a little bit an oil play), so this pair of excellent undervalued companies, CF plus BXE create a great partly hedged combination. So CF was exactly what I was looking for. Thanks again!
    Apr 23, 2015. 10:32 PM | Likes Like |Link to Comment
  • Merger Arbitrage Forum (Though Any Arb Can Be Discussed) [View instapost]
    mara_sarena, agree with you. Examples are important. Similar thing happened with SMCI. At ~3PM the stock started crashing on no news but a negative earnings was released after 4PM. So clearly somebody knew. On the other hand, glad somebody knew. I avoided buying before the earnings.
    Apr 23, 2015. 12:25 PM | Likes Like |Link to Comment
  • Free Gold [View instapost]
    As an update, the merger has been officially approved http://bit.ly/1zsjPQ9 so expect to see your PZG shares converted to CDE on Monday and expect the PZG WI stubs to show up within a few days depending on a broker I think. By the way, the PZG WI has already been trading for a week or so, at a really cheap price, going constantly up.
    Apr 18, 2015. 05:32 AM | 1 Like Like |Link to Comment
  • Gilead Sciences Reminds Me Of Apple Circa June 2013 [View article]
    GILD is a great company but I don't see how the current pricing on healthcare in general can last more than a few years into the future. Almost all developed countries are heavily indebted. The healthcare costs keep rising wel above GDP rates and are already high relative to GDP and very high in the U.S. relative to Europe and other countries. Who exactly is going to pay a $40,000 or $100,000 treatment? I think the system is maxed out and we are close to peak debt capacity. Despite the obvious life-saving effect, the current heathcare and public finances system is already half-bankrupt and realistically can't afford current costs of healthcare.

    Also, I admit I didn't check the numbers thoroughly as I don't follow GILD, so please correct me if I am wrong and I apologize if I am not correct. But key insiders are selling every single share they convert from stock option plan. The CEO holds a semi-convincing stake, roughy 4 years worth of his stock option bonuses, so perhaps 2 years of his total salary. But the VP R&D holds just probably six months worth of his stock option bonuses. Taking into account his cash part of salary, the chief R&D person of GILD is holding less than 6 months worth of his total salary in this stock.

    Even most of you on this board hold a higher stake relative to your salaries. Something to think about when estimatign future pipeline potential.
    Apr 17, 2015. 10:14 PM | 2 Likes Like |Link to Comment
  • Why Is Office Depot Stuck Around $9, Way Below The Offer Price Of $11? [View article]
    Pepsi and Coke are sugar in the water, so they at least have water in common.

    Kidding aside, I think merging 2 struggling companies doesn't create one great company. So in the long run, I wouldn't hold either of the stocks. Just for the merger arbitrage maybe.
    Apr 17, 2015. 08:38 PM | 1 Like Like |Link to Comment
  • CUBA - Retail Exuberance Drives Unwarranted 33% NAV Premium And Potential Insider Selling Catalyst [View article]
    Excellent article, thanks for the idea.

    I just don't like the high stock borrow cost. At 15%, if the markets stay irrational for more than 2 years, you are not making any money in terms of opportunity cost. If retail investors created this irrationality, they may stay same irrational for a decade. If CUBA had options though, I would have played this.
    Apr 17, 2015. 07:36 PM | Likes Like |Link to Comment
  • A Week In The Life Of Sifting The World – Friday, April 17, 2015 [View instapost]
    Agree with bazooka. A high conviction bet. Plus I am pretty sure Chris has been buying some more pure PZG WI on the first day of trading, when it was selling below $1.50 most of the day I think. Most people didn't realize the ticker is already trading. Buying more PZG WI gives you a higher leverage as much less capital is needed per PZG WI stock. An almost 40% gain so far on PZG WI if bought around $1.50 compared to just a few percent on the stub purchased through PZE/CDE during the same time.
    Apr 17, 2015. 07:21 PM | 1 Like Like |Link to Comment
  • Reading China's Fortune [View instapost]
    Chris,

    "brokerages have been helpful regarding the mechanics of executing the strategy"

    Just curious, how can the brokerages help you if you are a really big customer, apart from lower trading fees? Do they actually trade the strategy for you while you give them some general automatic instructions/limits/tr... or is it something else?
    Apr 16, 2015. 06:07 PM | Likes Like |Link to Comment
  • Reading China's Fortune [View instapost]
    Mark, do you mean selling straddles on only 1 side of each opposing instrument, such as sell calls on YINN and sell calls on YANG? Or do you mean selling on both sides of one ETF? Buying the straddle seems really expensive, and hoping for a big move either way.
    Apr 16, 2015. 06:03 PM | Likes Like |Link to Comment
  • Reading China's Fortune [View instapost]
    Chris, if you measured the annual returns, what figures are we talking about from the leveraged 3X decay strategy overall (all ETFs blended together to average out the returns a bit)?

    I am also curious what level of capital or margin level do you use as a basis for the calculation of returns since the loss is theoretically unlimited? Do you accept infinite risk on the positions, or do you limit it at a certain percentage by buying some options? (they are usually very expensive even at long tails)
    Apr 16, 2015. 06:01 PM | 1 Like Like |Link to Comment
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