A Credit Analysis For Coal Mining Companies [View article]
In my book Myths, I stated that some sectors are hard to evaluate from the fundamental metrics and miners is one of them. Since the scores from Scoring Stocks may not be reliable, I may want to skip the scoring for these stocks esp. two of this small group has over 9% jump yesterday.
--- Here is the description:
Miners. It is extremely difficult to estimate how much ores (sometimes a miner owns several different ores of different grades in same or different mines) the company has; complicated by the complexities to extract and transport them. When those costs are greater its production price, the company will not be profitable. Understanding the market for ore futures is another discipline.
Many mining companies are in foreign countries such as Canada, Australia and Brazil. Their financial statements are more trustworthy than those from most other emerging countries.
One potential problem of mining companies from many emerging countries is nationalization.
Mining rare earth ore is extremely risky when profit is dependent on how much China, a major producer of these ores, prices its ores. After China announced the export restrictions on rare earth elements, several companies out of China announced to reopen their mines for rare earths but few makes any profits in 2013. Developed countries have stricter environmental regulations.
I have ANR, traded JRCC before, and placed an order on BTU and WLT (most likely not executed).
Very volatile from my memory. At one time I had several coal stocks, up 25% in several weeks, down to break even, then further down, up and then down. It could be great for traders. They still have good long term potentials from today's low prices.
A Credit Analysis For Coal Mining Companies [View article]
I agree with the author that it will take a long time to replace coal (50 years at least). Even with all the nuclear generators on-line in China, China still will depend on coal for more than 70% of the country's energy.
There have been a lot of improvements in burning coal, but it will never be clean as it is a basic chemical equation.
We have many predictions in the last 10 years about solar, wind, and even China's pebble nuclear (adapted from a German innovation)... They are all castles in the sky and will be only feasible in certain areas such as hot and windy areas or with government subsidies and rebates.
The shale energy could be a Godsend or a trap. 2015 could give us a clearer picture.
I like the coal companies in Australia as it is closer to China. China has plenty of coal but no much oil (I need to write to God for his reason). The good quality of coal (with less pollution) is only available in North East. A lot of barges move from NE to West China via the Yangtze River and that causes more pollution.
A Credit Analysis For Coal Mining Companies [View article]
Great and timely analysis.
I'm finding entry points to this beaten sector. Judging from some initial analysis, they're over-sold. Yes, it is risky for the last year and hopefully we have found the bottom. Bottom or trap? Only time can tell.
Just a constructive comment (hope you do not mind): Use % such as debt / market cap that would give better comparison with other companies. When I have time, I'll plug the numbers into my scoring system to see how they stack up. Thanks again.
* In taxable accounts, long term capital gains are valuable than qualified dividends. Both pay virtually zero capital gain. However, when the tax law change (and it will eventually particularly the government needs taxes), then the l.t. capital gains if sold will have been sheltered lacking a better term.
* For some years I do not want to sell all my winners due to boosting income (such as Roth conversion). This year I sell some winners and some losers to offset the gain, in my turn to churn my portfolio to increase its appreciation potential.
* The following I'm not very sure. When you're in 25% tax bracket and you're not eligible for the zero Federal l.t. capital tax, however, do you still qualify for zero tax bracket for a portion of the l.t. gain similar to the tax ladder (you have lower tax rate on lower bracket and then move up the ladder and the highest tax rate (called marginal) for your top income after the last bracket. I may not explain it clearly here.
Big Moves Are Coming For These Small Caps [View article]
Great picks. I was doing something similar for a new article of my book.
I included my big winners and big losers (over 25% or less than 25% returns). They are the positions I still have and the stocks I sold this year.
There are 21 winners with avg . annualized return of 111%: ACAT, ADM, BIIB, BSX, C, CAMP, CSCO (count 2 times), CUZ, DGI, EMN, FFCH, MSFT, NSIT, STRZA, USNA< OMX, DLTR, DECK, BANR, and ADES.
There are 11 losers with avg. annualized return of -163%: BPI, NTE, SIGA, SIM, VELT, STEC, IAG, END, DEER, CRUS, and HXM.
The combined avg. annualized return is 73%. It has been a rising market, so I do not know what happens in a down market.
The purpose is to find the common denominators of the two groups. Tech stocks appear in both group. The big winners include several stocks ready to be acquired by larger companies.
Most losers are foreign companies and miners (none of them in the winner group).
Fortunately, the return should be better as there are several double bets on the winner (CSCO 4 bets) and no double bet on any of the losers. The avg. score of the winners is above 3 and the avg. score of losers is less than 3.
Q1. It also affects the tax on social security. One year I had a lot of long term capital gains, I paid no Federal tax but my tax on social security increased. Sounds right?
Q2. There will be several years away from my forced withdrawal at 70 1/2 for me. I converted a lot to Roth.
I assume the Roth is not counted in the minimum withdrawal rule.
I assume the Roth conversion is counted as my income, so most likely it would raise my tax bracket to disqualify me from the zero long term capital tax.
Q3. The loss of the wash sales is not allowed but the cost basis of the newly acquired stock will reflect the loss. Right?
Q4. I transferred a short-term loser to my son's account hoping to offset his short-term gain. However, it seems the cost basis is the price of the stock at the transfer.
Caterpillar: 15% Dividend Increase Makes It A Buy [View article]
I believe Moon is saying that it still going down so it is better to wait (esp. a correction is expected). However, no one can predict the bottom, so if you're a long term investor as Norman, you may not care about the extra price in order not to miss the boat.
In another words, you both are correct depending on your individual situation.
Caterpillar: 15% Dividend Increase Makes It A Buy [View article]
Actually market timing is not as hard as it appears to be. Check out my book Debunk the Myths in Investing (amazon).
Besides the common logic, a simple chart has been proven it can detect the last two plunges (2000 and 2007). I'm not a 100% that it would detect the next plunge, but it is far better with proven tools (tools are free) than without. Technical analysis is based on past data, so it cannot detect the peak, but it should never miss the big plunge.
Caterpillar: 15% Dividend Increase Makes It A Buy [View article]
Hi Norman, it has been a long time not hearing for you.
I do not buy a stock just because of the dividend alone. From the fundamental metrics (from my scoring system described in my book) it has been a good buy for a while. It has a lot of cash (and also long term debts) and the investment is so far not paying off (including a fraud from a Chinese company they acquired).
It is the worst performer (still making money but pale compared to SPY) among a list of so-called deeply-valued companies including Cisco (the lead performer in the pack), Microsoft...
I trade the stocks in this list and CATS now is my largest bet in the list (could be the stock has not risen much) and hopefully it will improve. I believe it is a stock that we should buy and forget it (for 2 or so years). This stock will rise with the economy with the recovery of construction and mining.
I read this old post due to some one posted sth here.
I sent my first High-Impact to a broker (so it is real) that I recommended Apple on 4/21/13 when Apple was 390.50 scoring high in my scoring system based on my book Scoring Stocks (from amazon).
I could be lucky in my report and a little too early in the post here. We have to be patient as fundamentalists are swimming against the tide for value stocks. Thank me in 2 years or hate me then.
It does not always work for individual stocks all the time. However, statistically it works with the findings in the book. Happy investing.
5 Reasons Why I Am Shorting The Market [View article]
I still like Health Care due to the aging population.
Require housekeeping on options. contra ETF on SPY is an option to an option.
We use to judge the value of the market with its 5-year average P/E together with the interest rate (or bond rate). It may no longer be valid due to the pumping of too much money to lower the interest rate.
5 Reasons Why I Am Shorting The Market [View article]
I do not short the market but have been accumulating cash to about 60% (it is more than 100% for me as I never kept that much cash).
My reasons are described in my book Debunk the Myths in Investing. 1. The cost of shorting (interest, dividends and risk).
2. The bubbles in 2013. Long term bonds are not safe heaven.
3. The risk. We still have a non-correlation of the market and the economy. Hence, many proven theories before could be busted due to too much money pumped into the market.
A Credit Analysis For Coal Mining Companies [View article]
---
Here is the description:
Miners.
It is extremely difficult to estimate how much ores (sometimes a miner owns several different ores of different grades in same or different mines) the company has; complicated by the complexities to extract and transport them. When those costs are greater its production price, the company will not be profitable. Understanding the market for ore futures is another discipline.
Many mining companies are in foreign countries such as Canada, Australia and Brazil. Their financial statements are more trustworthy than those from most other emerging countries.
One potential problem of mining companies from many emerging countries is nationalization.
Mining rare earth ore is extremely risky when profit is dependent on how much China, a major producer of these ores, prices its ores. After China announced the export restrictions on rare earth elements, several companies out of China announced to reopen their mines for rare earths but few makes any profits in 2013. Developed countries have stricter environmental regulations.
A Credit Analysis For Coal Mining Companies [View article]
ACI 4%, -18%
ANR 3%, -19%.
ARLP 0%, -19%.
BTU 0%, -19%.
JRCC 9%, -1%.
WLB 1%, -3%.
WLT 17%, -22%.
I have ANR, traded JRCC before, and placed an order on BTU and WLT (most likely not executed).
Very volatile from my memory. At one time I had several coal stocks, up 25% in several weeks, down to break even, then further down, up and then down. It could be great for traders. They still have good long term potentials from today's low prices.
A Credit Analysis For Coal Mining Companies [View article]
There have been a lot of improvements in burning coal, but it will never be clean as it is a basic chemical equation.
We have many predictions in the last 10 years about solar, wind, and even China's pebble nuclear (adapted from a German innovation)... They are all castles in the sky and will be only feasible in certain areas such as hot and windy areas or with government subsidies and rebates.
The shale energy could be a Godsend or a trap. 2015 could give us a clearer picture.
I like the coal companies in Australia as it is closer to China. China has plenty of coal but no much oil (I need to write to God for his reason). The good quality of coal (with less pollution) is only available in North East. A lot of barges move from NE to West China via the Yangtze River and that causes more pollution.
A Credit Analysis For Coal Mining Companies [View article]
I'm finding entry points to this beaten sector. Judging from some initial analysis, they're over-sold. Yes, it is risky for the last year and hopefully we have found the bottom. Bottom or trap? Only time can tell.
Just a constructive comment (hope you do not mind): Use % such as debt / market cap that would give better comparison with other companies. When I have time, I'll plug the numbers into my scoring system to see how they stack up. Thanks again.
5 Tax Tips And Tricks In Investing [View article]
* For some years I do not want to sell all my winners due to boosting income (such as Roth conversion). This year I sell some winners and some losers to offset the gain, in my turn to churn my portfolio to increase its appreciation potential.
* The following I'm not very sure. When you're in 25% tax bracket and you're not eligible for the zero Federal l.t. capital tax, however, do you still qualify for zero tax bracket for a portion of the l.t. gain similar to the tax ladder (you have lower tax rate on lower bracket and then move up the ladder and the highest tax rate (called marginal) for your top income after the last bracket. I may not explain it clearly here.
Big Moves Are Coming For These Small Caps [View article]
I included my big winners and big losers (over 25% or less than 25% returns). They are the positions I still have and the stocks I sold this year.
There are 21 winners with avg . annualized return of 111%: ACAT, ADM, BIIB, BSX, C, CAMP, CSCO (count 2 times), CUZ, DGI, EMN, FFCH, MSFT, NSIT, STRZA, USNA< OMX, DLTR, DECK, BANR, and ADES.
There are 11 losers with avg. annualized return of -163%: BPI, NTE, SIGA, SIM, VELT, STEC, IAG, END, DEER, CRUS, and HXM.
The combined avg. annualized return is 73%. It has been a rising market, so I do not know what happens in a down market.
The purpose is to find the common denominators of the two groups. Tech stocks appear in both group. The big winners include several stocks ready to be acquired by larger companies.
Most losers are foreign companies and miners (none of them in the winner group).
Fortunately, the return should be better as there are several double bets on the winner (CSCO 4 bets) and no double bet on any of the losers. The avg. score of the winners is above 3 and the avg. score of losers is less than 3.
5 Tax Tips And Tricks In Investing [View article]
Q1. It also affects the tax on social security. One year I had a lot of long term capital gains, I paid no Federal tax but my tax on social security increased. Sounds right?
Q2. There will be several years away from my forced withdrawal at 70 1/2 for me. I converted a lot to Roth.
I assume the Roth is not counted in the minimum withdrawal rule.
I assume the Roth conversion is counted as my income, so most likely it would raise my tax bracket to disqualify me from the zero long term capital tax.
Q3. The loss of the wash sales is not allowed but the cost basis of the newly acquired stock will reflect the loss. Right?
Q4. I transferred a short-term loser to my son's account hoping to offset his short-term gain. However, it seems the cost basis is the price of the stock at the transfer.
Thanks!
Caterpillar: 15% Dividend Increase Makes It A Buy [View article]
In another words, you both are correct depending on your individual situation.
Caterpillar: 15% Dividend Increase Makes It A Buy [View article]
Besides the common logic, a simple chart has been proven it can detect the last two plunges (2000 and 2007). I'm not a 100% that it would detect the next plunge, but it is far better with proven tools (tools are free) than without. Technical analysis is based on past data, so it cannot detect the peak, but it should never miss the big plunge.
Caterpillar: 15% Dividend Increase Makes It A Buy [View article]
I was more than 'all in' (using leverage) in 2009. It was my best year from my memory.
Mining Stocks - Unloved But Far Too Cheap Now [View article]
I have been right many times except in the timing - too early could cost me 10% and too late I could miss the boat.
Caterpillar: 15% Dividend Increase Makes It A Buy [View article]
I do not buy a stock just because of the dividend alone. From the fundamental metrics (from my scoring system described in my book) it has been a good buy for a while. It has a lot of cash (and also long term debts) and the investment is so far not paying off (including a fraud from a Chinese company they acquired).
It is the worst performer (still making money but pale compared to SPY) among a list of so-called deeply-valued companies including Cisco (the lead performer in the pack), Microsoft...
I trade the stocks in this list and CATS now is my largest bet in the list (could be the stock has not risen much) and hopefully it will improve. I believe it is a stock that we should buy and forget it (for 2 or so years). This stock will rise with the economy with the recovery of construction and mining.
Apple Has Little Left To Lose [View article]
I sent my first High-Impact to a broker (so it is real) that I recommended Apple on 4/21/13 when Apple was 390.50 scoring high in my scoring system based on my book Scoring Stocks (from amazon).
I could be lucky in my report and a little too early in the post here. We have to be patient as fundamentalists are swimming against the tide for value stocks. Thank me in 2 years or hate me then.
It does not always work for individual stocks all the time. However, statistically it works with the findings in the book. Happy investing.
5 Reasons Why I Am Shorting The Market [View article]
Require housekeeping on options. contra ETF on SPY is an option to an option.
We use to judge the value of the market with its 5-year average P/E together with the interest rate (or bond rate). It may no longer be valid due to the pumping of too much money to lower the interest rate.
5 Reasons Why I Am Shorting The Market [View article]
My reasons are described in my book Debunk the Myths in Investing.
1. The cost of shorting (interest, dividends and risk).
2. The bubbles in 2013. Long term bonds are not safe heaven.
3. The risk. We still have a non-correlation of the market and the economy. Hence, many proven theories before could be busted due to too much money pumped into the market.