InvestBaboo's  Instablog

Geez, I have posted again and again saying that BRCD is a prime acquisition target and it is a question of WHEN and not IF this will happen.

BRCD has vaulted upwards of 25% in the last week based on acquisition rumors. A fair acquisition price for BRCD is around $13/share. In the AH today BRCD is trading at about 9.80.

Well, in my post just before Labor Day I cited unscientific reasons in my decision to pull out and close most of my major swing trading positions. I said at that time that I just did not see what fundamentals would drive this market up. However, the rally continued for a week more and then the slap in the face came as the markets declined 7 of the last 8 sessions. So where do we stand now?

If S&P battles the 1000 mark and loses it will most likely fall to the 975 area which would present a buying opportunity. I believe such an opportunity may present itself sometime this coming week. I will see if I can publish a list of stocks that I believe have strong merit for consideration to buy on such a dip. Happy weekend all and have fun!

The Slumdog Millionaire portfolio that I published on April 11, 2009 is up a staggering 121% to date (as of closing prices on Sept 18, 2009). So in just 5 months the portfolio had more than doubled far surpassing the marlket performance.

The link to my original article is this:

http://seekingalpha.com/instablog/176707-investbaboo/534-preparing-for-the-coming-black-swan-event-the-slumdog-millionaire-portfolio

Here is what the "ORIGINAL" portfolio looks like today:

EQUITY	PRICE ACQUIRED	DATE	CURRENT PRICE	STATUS	CURRENT VALUE
ACAS	$2.50	4/8/2009	$3.18		$1,272
AFFX	$3.68	4/8/2009	$9.08		$2,467
ATPG	$5.89	4/8/2009	$20.11		$3,414
AYR	$5.97	4/8/2009	$10.37		$1,737
BAC	$9.55	4/8/2009	$17.63		$1,846
C	$3.04	4/8/2009	$4.26		$1,401
CHK	$20.70	4/8/2009	$27.85		$1,345
DRYS	$4.75	4/8/2009	$7.27		$1,531
FAS	$8.71	4/8/2009	$17.39		$1,997
GAP	$5.86	4/8/2009	$7.67		$1,309
GE	$11.33	4/8/2009	$16.55		$1,461
GFIG	$3.91	4/8/2009	$7.25		$1,854
GGP	$0.95	4/8/2009	$4.20		$4,421
GLBL	$5.01	4/8/2009	$10.00		$1,996
GNW	$2.75	4/8/2009	$13.04		$4,742
HLX	$8.57	4/8/2009	$15.43		$1,800
HUN	$4.12	4/8/2009	$9.60		$2,330
IO	$1.87	4/8/2009	$3.50		$1,872
JNS	$8.18	4/8/2009	$14.47		$1,769
LCC	$3.46	4/8/2009	$4.98		$1,439
LIZ	$4.11	4/8/2009	$5.84		$1,421
LVS	$4.44	4/8/2009	$18.88		$4,252
MF	$5.50	4/8/2009	$7.29		$1,325
MGM	$5.30	4/8/2009	$13.22		$2,494
MI	$7.22	4/8/2009	$8.13		$1,126
MTG	$2.10	4/8/2009	$8.76		$4,171
NSIT	$4.01	4/8/2009	$11.75		$2,930
PCX	$4.50	4/8/2009	$12.55		$2,789
PEI	$5.79	4/8/2009	$8.32		$1,437
PL	$7.10	4/8/2009	$22.05		$3,106
RRI	$4.60	4/8/2009	$6.73		$1,463
SHO	$3.11	4/8/2009	$6.89		$2,215
TTI	$4.17	4/8/2009	$10.03		$2,405
WYN	$7.20	4/8/2009	$16.09		$2,235
XL	$7.68	4/8/2009	$16.89		$2,199
ZQK	$1.35	4/8/2009	$2.86		$2,119
Total Investment in Slumdogs =			$36,000
Current Value of Slumdog Portfolio =			$79,692

There were additions along the way and I had suggested Stoplosses for those that wanted it even though I went without any Stoplosses in my personal portfolio. I just wanted to go back and compare the very original published Slumdog portfolio on Apr 11, 2009 and compare it to where it stood today.

I am using today's rally to unload a major portion of my swingtrading portfolio to capture profits. No, the charts do not tell me to sell but I find it a little hard at this point to see what can drive the markets post labor day. I may be wrong but I feel happier taking profits now rather than wait to find out how post Labor Day trading is likely to resume. Good luck all and have a very happy Labor Day!

Talk about being lucky! I recommended Sepracor (SEPR) just a couple of days back and it gets acquired for $23/share which gives you 30% profit in just a handful of days!

Well, well, well!

Right after the market close comes the announcement that Dell now has partnered to sell BRCD's network switches. Now, listen to this, the Dell VP of network servers says it is a much better sale when you package servers and networking equipment together! Given Dell's ambitions does this mean Dell might have considered acquiring Brocade? And if so were they turned down by Brocade because they think it is good to go independent or they might have a better paying suitor?

And there is a high visibility public event between Net One and Brocade in Tokyo in the near term. What could the public event be about given high profile execs from both companies will be at the podium? I don't know but I will bet it is in the least another stellar partnership for BRCD! Obviously you can guess what is a better case scenario than just another partnership announcement! :-)