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Amazon, Apple, Google: Buying on the Way Down

I've been doing the same thing, averaging down. True, it's better for those of us with a bit more time on our side, but it's a better strategy than trying to time the market perfectly with one enormous buy at the bottom.

And remember, if you wait too long, you can miss the opportunity. You can never know if it's THE bottom until after an extended rally. And the way things have been, I would not be surprised in the least if "the" rally we're all waiting for takes everyone by surprise and climbs at a record setting pace. If that happens, you can easily miss the boat on the bargains.

If Only Hope Were an Investment Strategy

No, this is hedge fund redemption notice period.

Funds are liquidating, dumping shares indiscriminately. Take advantage of the bargains because the redemption notice period ends December 1.

Thursday Outlook: New Lows?

I admit that I don't even know how to read those charts. But my sense is that this isn't about retesting lows. This is about fund liquidation. Prices may drop quite a bit as Nov 15 approaches, and may spark a panic. But I see things looking up after Thanksgiving and through December, after the hedge fund redemption period has passed, and hedge funds start buying back all the stocks they've been converting to cash.

Is Buffett Really Losing His Touch?

Obviously the dude knows what he's doing. It's funny to see people making judgements on his long investments after just a few weeks. The very fact that other people DON'T think it's a good buy is exactly what MAKES it a good buy. If others thought it was a good deal, they'd be buying it, and the price would be too high for it to actually be a good buy. Get it?

Will Apple's Q1 2009 Revenue Estimates Be a Blowout?

My thoughts exactly. I also heard somewhere that many funds are required to hold a certain percent in stocks by the time monthly statements go out to investors. Anyone know anything about this? If it's true, then it would explain why things calmed down and AAPL (and the rest of the market) climbed higher at the end of the month of October. Hedge funds were converting their cash back into shares. I'm willing to bet we'll see the same mid-month swings in November, with a sudden calming around the end of the month. I also agree it will coincide with fraudulent analyst reports. Repeat each month for the rest of the quarter, I suppose, or until banks start lending cash again.

On Nov 10 03:55 PM buffeted wrote:

> I agree that Apple will do MUCH BETTER than expected for this Q,
> but what is going on now, and will continue until after thanksgiving
> before it gets any better, is HEDGEFUND LIQUIDATON! THE FAVORITE
> place to play for hedgefunds for the last 2 years has been AAPL and
> now its time to sell or die. Probably, this is the best time to sell
> a covered call on aapl for a Nov. expiraton that I can remember.
> Any strength in Aapl will result in huge valume selling. Also, dont
> be surprised to read some more bearish B.S. by anlysts on the payrolls
> of banks running the funds in the next week 4 to 8 weeks.

Nassim Taleb: Renegade Trader with Renegade Ideas - That Work

Taleb specifically warns against comparing reality to a casino game. He calls it the ludic fallacy. Google it.

And this sort of bear market bet he made is not his only strategy. The vast majority of the money is kept safe while a small portion is used to make risky bets. This can be getting in early on a future positive black swan, like the next google. He favors tech and ingenuity. Anything that involves tinkering.

He recomends staying away from businesses that bet against a black swan occurance, such as insurance and banking. Eh, just read the book. It's very, very nuanced. And finance is just a small part of it.


On Nov 09 11:23 AM captainccs wrote:

> It takes a very special kind of personality to be able to lose time
> and time again, hundreds of times, before getting a win. Also, there
> is no way to predict these rare and unusual results so what Taleb
> is really playing is the mis-pricing of options. Playing options
> with Black-Scholes is like playing carps with loaded dice.
>
> My point is this: If you play any casino game long enough the house
> is going to make the vigorish and you are going to lose it. Taleb
> makes hundreds of bets and most lose small and a few win big. If
> he can make money doing that it means that the options he is buying,
> in the aggregate, are underpriced while the big winners are overpriced.
> It's either that or Taleb has enough prediction abilities to milk
> a fair system. This last is doubtful by his own admission.
>
> Taleb should probably shut down Universa Investments when the bear
> market ends. In a bull market the mis-pricing of put options might
> not be enough to make money his way. Last year I was buying out-of-the-money
> call options and did quite well. That ended with the onset of the
> bear market. During the bear market I'm making money selling call
> options. Buy the bull and sell the bear.

Nassim Taleb: Renegade Trader with Renegade Ideas - That Work

Great article! I loved The Black Swan. One correction: Nassim Taleb DID see this meltdown coming, and warned in The Black Swan that Fannie Mae was "sitting on a pile of dynamite", but that their team of scientists and their computer models lulling themselves and everyone else into a false sense of security. Therefor, from Nassim's perspecitve, this wasn't technically a Black Swan, but rather a slow motion train wreck. Props to him for maneuvering accordingly.

Apple's Future in the Mobile Phone Market

Very good points, regarding an iPhone nano. It's significant because it would make apple even more powerful and profitable. Apple needs to get as many toes wet as possible. The phones serve as a low cost entry point for apple's other products. Phones lead to iTunes sales, and appletv could be a next step (when it's ready) since it would easily sync with iTunes. And satisfaction with a phone by apple can easily lead to willingness to purchase a MacBook or iMac. An iPhone nano would accelerate apple's growth exponentially.

Who Will Win the Home Entertainment Battle?

I agree that AppleTV sucks. Apple is, however, still poised to be the dominant brand for home/personal entertainment and communication. It's simply a matter of increased download speed and storage capacity.

No one can match the simple lifestyle integration Apple is already starting to offer. Within 5 years or so, I predict Apple will provide a seamlessly synchronized personal network for consumers. Everyone will have three simple and powerful devices: an iphone (or whatever it evolves into), a macbook (or future equivalent...think macbook air, but several times more powerful than the current macbook pro), and an Apple home server that is constantly backed up in "the cloud" (Time Machine meets MobileMe). Here's the key: they will be beautiful, well-built, and idiot-proof...somethin... MicroSoft, Sony, and others seem unable to pull off nearly as well.

Is It Time for Apple to Buy Back Some Shares?

Someone please explain how a buyback would benefit Apple. Yes, it would technically increase EPS (as if Apple's current EPS is poor?), but it would cost Apple this pile of cash that makes investors feel secure that Apple is invincible. How does sacrificing this cash cushion in exchange for (technically) increasing EPS help Apple in any way? It makes no sense. Toni sounds like a moron. Why does anyone even pay attention to these frauds?

It definitely seems like a ploy to get a price spike before dumping shares...

Share Buybacks Make Apple Sweeter

Yeah, I agree with these comments. It's amazing how myopic analysts and Wall Street folks can be. Can anyone tell me why Apple would want to raise it's EPS 4% with a buyback rather than invest that money in ways that will increase it's efficiency, quality, and growth? It's been hiding earnings with these GAAP numbers for a while...maybe it doesn't want or need to raise it's EPS.