An anylist by the name of Scott Barbee makes a convincing case for FBR.Now,I am a bit familiar with this stock, having owned it years ago when it changed from a Investment bank into a REIT.At the time REIT[real estate investment trusts] were very popular due to the favorable tax treatment and the sucessful conversion to this format by other corporations..That was before subprime.Guess what they invest in?yup… mortgages.The stock was a disaster for me then; I sold it at $7 bought at 15$.That was years before the subprime meltdown as well!.But it has got worse..it is now trading at$1.60.To say this stock is hated is an understatement.However in many ways the stock is a poorer version of Analy mortgage.They invest in mortgage loans and work off the spread.Analy is the best of the group and it has been hurt too..but not like this!.Mr Barbee claims to have looked through the mortgage and agency bond portfolio and finds it not as horrific as it’s near bankruptcy stock price would indicate.Why would this be a possibility for the contest?..1]low stock price =much leverage.$3 is a 100% gain.2]Financial stocks have been pounded into the sand for the last 7 sessions.They bounced on Fri and were up today.A strategy that has worked is to find stocks in a sector that is out of favor,but is coming into favor,and have not participated yet. 3]limited downside=good risk reward.Don’t fall in love with this stock! shoot for a coat tail ride if the financials have a good week .Goldman Sacks and other big companies report earnings this week.Look for plays in this volatile sector this week!2008-06-16

A tidbit I caught today…If you saw my earlier posts I am skeptical that SIRI is a good stock to win with for this contest.however today A government representative [FCC?]was on CNBC.If you did not see it he was asked by the reporter.When do you expect to wrap up your review?.He gave the usual WSO..Poker response.basically;” It’s very complicated”.At this point ace reporter David Faber pressed him”Sir; respectfully, this has been going on for over a year..don’t you owe the company a answer; like tomorrow?”.The idea of this pointed question is to try to get, what is called in poker”A tell”.You minght want to see if you can review that clip on the cnbc site.My take was that maybe something is up.Naturally he gave a non commit answer” like we expect to wrap it up soon”.Which has been said before.What is different ?The bush administration is in its ending days.Frequently contriversial decisions are postponed till the end of congresses session.;.can you say summer recess?.you get the idea !..if this deal is to get done; it has to be before/if …the democrats take control of the FCC and congress.Expect something soon.But don’t expect a huge move[like a double] If the deal is approved.Still it could run %30 on news of a deal.Timing is everything.As I said I don’t think this is the greatest stock for this contest;but apparently this is the most widely held stock by contestants;so I thought it was pertinent.2008-06-05

Crox.Expected to earn $1.70 /share.huge short interest.everyone hates it now. down from $50 to 9$.Heh Heh.I like this one to buy outside of the contest but I would’nt bet the rent money.Could be a nice pop for the contest.What if it took a upgrade?or a agitator like Carl Ichan takes a stake?.You could get your 30% and move on.2008-06-04

This years contest is made harder by the addition of the currency trading option.it was stated that the top contestants have made 60,000$ trading currency primarily the dollar vs. euro.I am not sure the time frame that occured.That being said if you are unfamilar with currency trading[ like me ]you would probably be better off skipping that portion of the competition.It is quite possible that the combination of the two will not be in the eventual winners portfolio.Today I wanted to mention the small cap E&P oil companies.These volatile stocks have showed wild price movement.Check out ROYL and OMNI for example.Now you can play these either way ; if you think that oil price will tumble you could short these or if you are bullish buy on the dips.I have seen these stocks spike 30% in a day.They did the same thing after Katrina.Speaking of hurricanes; the season is on!.One way to play hurricanes that i did after katrina is MTRX.this stock does industrial repair of the kind needed on power plants ,refinerys and some drilling rig work.It can really soar on a landfall in the gulf.So keep an eye on these!2008-06-04

Well it looks like if you had played the ethanol stocks you could have banked at least 20% depending on your entry/exit day.Hope some did….As stated in previous post;…there is little hope in buying popular choices like Siri or Rad[down about 10% since contest started].The fact they are penny stocks is good;but not enough alone, if there is no catalyst to force a large move SHORT TERM.Many contestants have grasped the concept of leverage .And since options are not allowed in the contest,using low priced stocks is one way to increase leverage.Simply put ;the chances of a $2 stock doubling are much greater than a $40 stock doubling.But most $2 stocks don’t double; and in fact many go out of business.It is not enough to find under$10 stocks and “hope”. What is a example of a low priced stock that has potential for explosive move quickly?.The headlines are replete with new highs for oil.Hurricane season officially started yesterday.You can play this trend on the bullish side or the bearish side.Take a look at the small independent oil producers.These stocks can, and did double in the past as traders looked for under followed energy plays.Stocks such as NGAS,BDCO are examples of this kind of stock.They are in a “hot” sector,have a low share price,and most importaintly have a low float[few shares issued].Low float stocks can make explosive moves when buyers come in the name.Share price can move rapidly. Stocks which were low float “monsters” in the past were TZOO,HANS,TASR.They are not anymore!!! but if you look at the charts from several years ago you can see the kind of moves possible.We need to find such stocks now!.The existance of large short positions can make these a killing field for shorts;and a possible winning trade for the contest!2008-05-23

First the WCG idea didn’t result in a merger Monday anouncement; but at least it is flat from Friday if you decide to move on.Today we observe that PEIX and many of the other ethanol stocks are up big.in the case of PEIX about 40% since Fri[close$3.24 high so far $4.88].Now normally it minght be to late.But these stocks have both a low price and a catalyst to make them continue unlike say a SIRI.First Peix was as high as $40/share in recent times.The short interest is huge.20-30% of all available shares are short.Almost all anlyists have sell ratings on these stocks.So why is Peix up?.They beat the earnings estimates.This may be a momentary “dead cat bounce”or it may go on for days or weeks…as the shorts are forced to cover there short positions..fueling a move in the stocks2008-05-19

A idea of a stock that could help win!not just ones that won’t..WCG is moving on rumors of a takeover at $70.This minght be a hold over thee weekend since if rumors are true could be a nice pop.Remember that your entry price will be based on the closing price not the price intraday..so if it runs up a lot by the close…then don’t pull the trigger.2008-05-16

That all the on-air personalities at CNBC kick in a stock pick from there area of coverage…so for example Mike Huckman may contribute a Pharma stock; to help out the contestants,It seems that even the general reporters on the show are contributing their prognostications!.Does this make you uncomfortable?I think it makes them uncomfortable.They are reporters not stock traders ; as Cramer says just being”Team Players”.Some of there ideas I have heard I can guarantee are not going to do you any good.One recomendation was SIRI .In the record books as the most reviewed merger of two [now]penny stocks.Why won’t this stock work?In the first place you need large point moves and /or a lot of them to win.Even if SIRI doubled it probably wouldn’t help you because there are too many contestants playing the same hand[CNBC mentions on air ;the most held stocks by contestants;a contrarian indicator?].The fellow who is banking a 30% profit 5 days a week will be ahead of you after 4 days of lucky trades.Buy and holding a stock that doubles won’t win this contest!..unless you do it often.Another idea I heard today from Diane the real estate reporter was to buy,well ;real estate stocks.That is a better idea as these heavily shorted stocks could make a massive move up.But again; when?They have been stuck in a range for months,and unless a spark ignites them near term these will have the same problem as siri;they may very well be within 20% of the price they are now;a month from now.I guess even if you don’t do it in your regular investing you need to play risky “event” trades to win.2008-05-15

Many people [like me]wasted valuable time making ineffective trades due to not understanding a key point about the contest.It does seem like they are emphasizing it more this year but still it bears repeating.The TV ads say you can trade 7 days a week …. but how can you trade when the market is closed?.Well it does not matter because the way the contest is set up it is not really daytrading..meaning buying and selling stock repeatedly in a single day and at the end of the day tallying up your gains or losses..People who trade in the market for real will have to adjust there style since “DAYTRADING” CAN’T BE DONE.The stocks you purchase during any given day are priced as of the close of trading at 4 pm EST.So there is no reason to sell a security that is not at least a day old.This rule lends itself to traders who buy “event” stocks.For example today PCLN reported earnings.This stock has climbed a wall of worry from the single digits by continuously beating the earnings estimates and proving naysayers wrong.After reporting tonite the stock was up $20 from its closing price.So a excellent technique would have been to have bought that stock anytime today[thursday] and sell it anytime tomorrow when hopefully it would still be up the $20 that it was in the after hours session.Note that if the stock was trading at say 148$ at 1 pm tomorow[friday] and you entered a sell order you would not be credited at $148 if it closed at say 134$ at 4 pm EST[friday];your trade would go in the records for your contest entry at the closing price of 134$ even if the stock traded at $148 intraday when you pushed the sell button in the contest..So in our example PCLN closed today at $123.94.If tomorrow it closes at $134 you will be credited with $10.06 profit for each share you bought today[thursday] prior to 4 PM est and sold tomorrow[friday]prior to 4 PM est.It seems simple but make sure you understand the timeline of what price CNBC is using to value your trade!2008-05-08

Trading starts in four days..you may be able to sign up after trading begins but I think it is advantage to get in early so you will have more days to trade.Not all of your trades will be winners..but a good way to add to your imaginary bankroll is to refer friends to the contest or play the triva contest wich will get you a additional $12,000 to play with,this can help offset those less than stellar trades!.2008-05-08