Friday, August 31, 2007

Migao - Too Much, Too Soon?

Migao has bounced back nicely since its recent low of $5.51 during that wild session on August 16th.

In two weeks' time, the share price has jumped back up to $7.82; that's almost 42% in two weeks! For this reason alone, I decided to sell my Migao shares today and wait for a re-entry point later this year. We'll see how this decision turns out.

Tuesday, August 28, 2007

Check Your Brokerage Account Regularly

The recent security breach at online brokerage firm, TradeFreedom Securities Inc., re-emphasizes the importance of checking your account activities on a regular basis, even if you are a passive investor. I would suggest logging in at least once a week just to make sure nothing fishy is happening and report any irregularities right away.

Another Reason to Check Your Lottery Tickets

If you play the lottery, you should always check your tickets manually as this news story identifies a potential issue with automated lottery checkers.

Saturday, August 25, 2007

VOIP to Cut Cell Phone Rates

Although I don't have a cell phone, I found the following article interesting:

New firm uses VOIP to cut cell phone rates

Fri Aug 24 2007
By Geoff Kirbyson

A Vancouver-based next generation mobile company is hoping to carve out a niche in the long distance cellular market by offering voice over Internet protocol calls for just pennies a minute.

Bill Tam, CEO of EQO, which is pronounced "echo", said it developed its technology because long distance charges on mobile devices are still sky-high compared to those on land lines.

EQO's service, which was launched across the country Thursday, charges 2.6 cents per minute for long distance calls in Canada and to 30 other countries. It also offers free instant messaging using a number of different platforms, including MSN, AIM, Yahoo!, Google Talk, ICQ and Jabber.

In order to use EQO, users have to go to the company's website, download its application to their wireless device and click on an EQO icon when making a long distance call.

"Consumers already have cell phones," said Tam. "We said, 'let's do it in software so they don't have to buy another piece of equipment.'"

Eamon Hoey, a Toronto-based telecommunications analyst, said EQO is playing in the same space as Yak Communications and Gold Line.

Thursday, August 23, 2007

Blog Roll Suggestions

Over the next few weeks, I'll be establishing a 'blog roll,' listing my favourite Canadian personal finance blogs.

If you feel that your blog is a valuable information source for Canadian investors, feel free to leave a comment with your URL and I'll check it out. If I agree, I'll place it on the roll.

You can also nominate other PF blogs that you believe Canadians shouldn't live without.

Monday, August 20, 2007

Holding on Tight

The good news is the cash in my portfolio is growing, percentage wise (at least); the bad news is that it's at the sake of my equities! The hemorrhaging has stopped temporarily... hopefully, for good!

I'm holding on tight to my hard-earned cash as I'm still not comfortable in investing in some of the discounted stocks on my watch list. Although they have present good buying opportunties. I have a sneaky suspicion that we will see another downdraft in the weeks and months to come, and we might not recover from this downtrend until November.

Hopefully, I'm wrong and the worst is over... but just in case I'm right, I'm taking this time 'away from the market' to identify some stocks that I'd like to get my hands on and decide if I should average down on the stocks I currently own. I'm also trying to figure out how much of my cash position should be devoted to each of these two strategies.

Once I've identified these stocks, I will try to determine their long term support levels and place a low-ball bid that just might happen, should the worst case scenario actually occur.

The volatility of late presents excellent daytrading opportunities to make quick cash but my work obligations make it impossible for me to partake in any such activities. As such, the long term view of stocks must take precendence in my portfolio at this time.

Wednesday, August 15, 2007

What to Do?

With the markets tumbling left, right and center, and several of my major holdings taking massive hits today, the question now is should I be buying more of the same stocks (like Agnico-Eagle Mines, Hanfeng, Migao, Silver Wheaton, Thompson Creek Metals) or try investing in one or two new stocks for a quick flip if the markets decide to turn around or just watch from the sidelines until things settle down a bit?

If only I had a larger war chest for times like these...

Tuesday, August 14, 2007


Until these volatile trading sessions stop their daily routine, there won't be any reason for the markets to recover back to their recent record highs. I say this because unless you are a long term investor, there is very little reasoning behind holding onto a stock in these uncertain times, after they make 5-10% profit intraday with the expectation that they can buy or short the stock for another quick 5-10% gain that same day or the next.

When we finally see daily intraday ranges of a maximum of one or two percent on individual stocks then maybe, just maybe, we'll see a return to the upside or maybe, it just will be the calm before the hurricane...

It will be interesting to see if this quarter's earnings of the TSX Group will benefit from the market volatility and associated record trading volume of recent days.

Saturday, August 11, 2007

Positive End to the Week?

Interestingly enough, the TSX Composite Index rallied in the last hour of trading on Friday, as shown in the intra-day chart below, ending the day down only 11.73 points.

Over the past few Fridays, the Index had collapsed in the final few hours of the day as traders apparently did not want to maintain positions over the weekend. What changed their minds this week?

Looking at the three-month chart of the Index below, the last two lows had very similar 'bars' with closes near the top for the day. I believe these are also referred to as 'hammer candles' if one were to examine them on a candlestick chart. This type of hammer is a sign of a potential change in a downward trend.

After the past few rough weeks, any upswing, even if only temporary, would be welcoming and might present an excellent opportunity to make new positions in quality stocks and/or lower cost averages on recent investments.

Wednesday, August 8, 2007

Rogers - No Signal

After watching my paper profits slip away on my Rogers shares over the course of the past few weeks, I sold my holdings today not because the company's fundamentals changed but because I feel that the market will be very volatile over the next few months (perhaps until November) and believe that I can pick up the shares at a lower price in the weeks to come.

Well, with Rogers closing at $46.51 today, so far I'm right! Though with the number of shares I owned, that's not a big deal in the grand scheme of things. Nonetheless, you can never go wrong taking a profit.

I believe that over the next few months I will be taking profits when I can and hopefully, buying shares at lower prices on a number of stocks on my watch list.

Monday, August 6, 2007

$60 Oil?

Michael A. Berry had some interesting comments regarding the future fate of oil in his Morning Notes today. I have included the entire commentary below so nothing is taken out of context.

If I were a cynic I would suggest that it would be in everyone’s best interest for oil prices to fall. Fortunately I am not cynical. However the DOW Transports, one of Richard Russell’s favorite indicators, cratered on Friday and broke through support levels. Railroad shares were down by 5% across the board on weak transport prices. One might draw the conclusion that the US economy is cooling, from these data.

This AM my very good friend Dennis Gartman notes that oil players are beginning to “delta hedge” their positions. Thinking back to October 1987 I remember a miracle product called Portfolio Insurance. The idea behind portfolio insurance was that you never had to pay a put option premium because you could easily (too easily it turned out) short the stock index futures to create a delta neutral position. Adjusting the short stock index futures position was of necessity a continuous process to maintain the delta neutrality or the hedge. But the magic was that institutions did not pay an options premium. Dennis points out, correctly, in his Gartman Letter, this AM, that the Saudis have suggested they are “OK” with $60 oil. WTI oil is trading down from its high of $78 to $74 as I write this AM.

A little reprise from the energy squeeze would be welcome to most of the people who have a hand in managing our world. Mom and Pop are scared. There is rampant fear based on the potential for a severe credit contraction. Lower interest rates won’t help that occurrence. Many think this has further to go. My point is this as the price of oil falls – if it falls a lot – the delta neutral hedges will be continuously adjusted to reflect the new spot prices. This can only be accomplished by selling more oil futures contracts. But IF the futures fall to a discount (through selling) with respect to the spot then the spot price is further dragged down and the cycle will repeat. It is a process that can create a meltdown. It is also a process that has the potential to move the spot price. Remember that these futures contracts can be settled in cash (rather that “in kind”) and we all know that there is plenty of cash around.

This sequence is precisely what occurred in October of 1987. There is a sure way to get those oil prices to $60. Let’s see how this plays out. Naturally if such a scenario were to occur you could expect to see many of the oil stocks falling in line with the price of the spot. One significant difference exists today. We are not talking about the S&P500 today. We are talking about a physical commodity, oil, which is in great demand everywhere in the world, even Iran. Perhaps we will find out what oil is really worth."

Saturday, August 4, 2007


So I went to the local farmers' market today and couldn't believe the price of corn this year; six bucks for a dozen!

The three dollars that I have become accustomed to paying for a dozen for as many summers as I can remember now gets you six cobs of corn.

It's no wonder that China will shift its dependence from corn to sorghum, cassava and sweet potato plants to make bio-fuel in the next five years.