Thursday, November 27, 2008

10 in a Row

According to The Globe and Mail, the Canadian stock market has posted a positive close every time U.S. markets closed for Thanksgiving since 1998.

The TSX closed up 110.25 to 8,753.77.

Wednesday, October 22, 2008

Oil is Going Down to $25 or less

Well, that's my gut-feeling prediction for the price of a barrel of oil when it hits its low point this time around.

Meanwhile, Bespoke Investment Group highlights a Fibonacci Retracement chart of oil since the low of $16.70 that it made in late 2001 and Chart of the Day showcases an inflation-adjusted chart of oil since the 1970s.

Saturday, October 11, 2008

Broke Even on POT

Just a quick note this weekend:

I sold my Potash shares earlier this week to break even. The fluctuation in its share price of late can only be described as wild so I got out and hope to get back in at a lower price.

Happy Thanksgiving everyone.

Saturday, October 4, 2008

Buying on Rumour, Selling on News

After Thursday's collapse in its share price, Mosaic shares recovered a bit with the rest of the market before the big Congress bailout package vote. Once the Bill was passed, most stock prices dove.

Luckily, I had decided to cash in my quick profit in Mosaic just before the vote in the fear that the expected passing of the vote was already priced into the little rally earlier in the day. Surprisingly, I was right! Well, at least in the very short term. It should be another interesting week next week.

Yesterday's Action:

Mosaic Company (MOS-N)
Close $40.88 (+$1.23, +3.10%)
Open $41.95
High $45.07
Low $39.66

Thursday, October 2, 2008

When There's Blood On The Street...

it's time to buy fertilizer stocks. Well, at least that's what I ended up doing today, with purchases of Potash Corp and Mosaic Company shares today. Both stocks took big hits today so we'll see how they pan out in the days to come.

Today's Data:

Potash Corp. of Saskatchewan (POT-T)
Close $101.00 (-$35.50, -26.01%)
High $116.00
Low $100.00

Mosaic Company (MOS-N)
Close $39.65 (-$27.86, -41.27%)
High $52.59
Low $39.41

Monday, September 22, 2008

Agnico-Eagle Mines' Double Bottom?

I'm a few days late to the party on this one but Agnico-Eagle Mines (AEM-T) has formed a really nice double bottom formation that I hope I can still take advantage of.

I should point out that I was deeply debating today if I should invest in the HBP Gold Bull+ ETF or shares in a gold miner. I'm not thrilled about my entry price in this stock today but we'll see if the pattern fulfills itself over time.

Agnico-Eagle Mines (AEM-T):
Open $65.00
High $69.58
Low $65.00
Close $68.32 (+$3.32, +5.11%)

Kitco New York Spot Price for Gold:
Low $874.50
High $909.90
Close $898.30 (+$26.50, +3.04%)

Saturday, September 13, 2008

Potash Thoughts

Canadian Dollars asked for my thoughts about Potash after its nice rebound the past few days so without further adieu, here are my opinions on the stock.

I think it is a great stock to own yet the volatility (especially of late) also makes it a great shorter-term trading play so if you have the ability to trade in and out of it on a frequent basis, go right ahead and give it a try if you'd like. I know I would if I had the time!

Looking at the chart, POT is still within its current downtrend.

Depending on how you draw the upper resistance line, you can say that it's close to breaking that trend. That being said, I personally would wait for one of the following to occur before entering into a position:

  1. It closes above the downtrend line and/or fills the gap (shown by the green lines).
  2. Retests and finds support at its recent lows.
  3. Bounces of the bottom line of the downtrend.
Waiting for POT to hit one of these three price targets would be the lower-risk time to invest. One of my goals going forward is to start acting on low-risk trading opportunities or at least considering the risk/reward ratio when entering trades. I guess we'll see how that goes in future trades.

I hope that helps you Canadian Dollars!

My 10 Questions for Election Candidates

If a candidate comes knocking on my door during this election campaign, these are the ten questions I intend to ask them:

  1. What will your party actually do to reduce government spending?

  2. Will your government allow private enterprises provide health care services to the Canadian public via our existing provincial health care system?
    (i.e. Patients will not have to pay extra for these type of health care services as the the provincial health care system will cover the costs - just swipe your health card and you're free to go)

  3. What concrete efforts will your government take to protect Canada's fresh water supply?

  4. Do you think the carbon credit trading system will actually reduce air pollution?

  5. Would your government agree to be legally and monetarily binded to a "Kyoto-type" agreement on air emissions if major polluting countries like China, India, Russia, and the USA do not commit to the same reductions?

  6. How will your government tax capital gains and dividends?

  7. Will your government toughen the Young Offenders Act?

  8. How will your government ensure that judges give tough sentences to criminals (especially repeat offenders)?

  9. Does your party believe government should be providing handouts and loans to companies in any sector (including the automotive, aerospace, environmental sectors)?

  10. Does your party support income-splitting between spouses?

I recommend that you create your own list of questions about the issues that concern you so you'll be ready to ask the tough questions to any election candidates that come by your neighbourhood requesting your vote in the upcoming weeks.

Thursday, September 11, 2008

Sold Royal Bank

I sold my shares in Royal Bank today. This is a temporary withdrawal of RY shares from my portfolio.

With the massive collapse in the share prices of commodity-based stocks, RY has fared fairly well of late. I suspect when the eventual commodity rally ensues, the money stowed away in financial stocks will pour into the commodities causing bank stocks to fall in value.

Monday, September 8, 2008

False report sends UAL stock on wild ride

Today's UAL Corp. (UAUA-Q) share price incident reveals how easily the stock market can react to so-called "news".

In case, you haven't heard the news, here's The Globe & Mail article on the incident:

False report sends UAL stock on wild ride

Globe and Mail Update
September 8, 2008 at 3:31 PM EDT

UAL Corp. saw its shares temporarily melt down Monday morning on false rumours that it planned to file for bankruptcy protection.

Shares in the parent of United Airlines were halted on the Nasdaq stock exchange at 11:08 a.m. (ET) after falling 76 per cent. Trade resumed at 12:30 p.m., with the shares down 8.6 per cent from their opening price to $11.25.

Stock quotes had the shares as low as 1 cent in morning trade, but terminals were updated to show an intra-day low of $3.

Morning trades would not be cancelled, the exchange said on its website.

The company said the panic was sparked by an old story from the Chicago Tribune reappearing as current news Monday morning. It was published on Dec. 10, 2002, and detailed the company's $22-million in daily losses and its bid to restructure while under bankruptcy protection.

“Reports that the company filed for bankruptcy are completely untrue and were cause by the irresponsible posting of a six-year-old Chicago Tribune story by the Florida Sun Sentinel newspaper website with the date changed,” the company said in a statement. “The story was related to United's 2002 bankruptcy filing, and United has demanded a retraction from the Sun Sentinel and is launching an investigation.”

The Chicago Tribune distanced itself from the situation Monday afternoon, with a story on its website saying internal tracking records showed that nobody at the paper had touched the original story file since 2003. The Sun-Sentinel and the Tribune are owned by the Tribune Company.

The chain said that the story was picked up early Monday from the Florida newspaper's site by an investment adviser at Miami's Income Securities. He posted the file on Bloomberg, where it would be disseminated to anyone with access to one of the data-company's terminals.

The rumours come at a difficult time for the airline industry, with most major carriers cutting routes and downsizing in a bid to survive higher fuel prices.

UAL reported a $2.7-billion (U.S.) loss in its second quarter, hurt by a $773-million increase in the price of jet fuel. Earlier this year it said it would have to cut 7,000 jobs, ground planes and reduce flights to cope with the higher costs.

Sold POT

I wish I was at home this morning to act on the quick drop in share prices after the market opened. Unfortunately work got in the way so I had to rely on my broker's telephone trading platform to get my quotes and place my sell order. I still fared pretty well compared to the closing price so I'm still somewhat happy.

This is today's chart of POT-T:

Today's Info:
High: $177.40
Low: $160.92
Close: $162.50 (-$9.850, -5.72%)

Thursday, September 4, 2008

Bought some POT today

Well, maybe not that kind of pot...

I'm talking about Potash Corporation of Saskatchewan (POT-T, POT-N).
Hopefully this support level will provide a nice rebound in the share price...

or I might just might need some of that other pot to get me through the day :)

Today's POT-T numbers:
Open $164.02
High $165.70
Low $155.39
Close $160.370 (-$4.16, -2.53%)

Wednesday, September 3, 2008

Long Weekend's Hurricane Miss

What happens when a hurricane expected to cause massive damage to the U.S. Gulf coast over the Labour Day long weekend ends up having little effect on the coast's energy infrastructure?

Tuesday's closing prices of some Horizons BetaPro ETFs:

-17.96% NYMEX Natural Gas Bull Plus ETF - HNU
+18.47% NYMEX Natural Gas Bear Plus ETF - HND

-9.58% NYMEX Crude Oil Bull Plus ETF - HOU
+9.26% NYMEX Crude Oil Bear Plus ETF - HOD

-11.57% S&P/TSX Capped Energy Bull Plus ETF - HEU
+11.48% S&P/TSX Capped Energy Bear Plus ETF - HED

Monday, September 1, 2008

Genius Can't Be Scheduled

With Labour Day here, summer has come to its unofficial end and traders should be coming back into the market which should lead to some interesting times in the weeks ahead. The summer months haven't been too friendly for me in terms of my investments so hopefully things will change very shortly to meet my year-end financial goals. I guess it's time to take a closer look at my charts and spot any new trends that might be emerging.

In the meantime, here's Sunday's Dilbert comic that nicely highlights my thoughts on the ridiculous notion of the 9-to-5 workday regiment employers still insist on despite the amount of downtime in the office.

Monday, August 11, 2008

Wi-Lan's Friday Jump and Today's Announcement

First of all, I'd like to apologize for the lack of posts lately. It's been a pretty busy time around here, with a new job, new friends and new extra-curricular activities. All good stuff! The only downfall is I've had very little time to concentrate on the markets and my net worth has been pretty much stagnant since then.

Nevertheless, I'd thought I'd highlight the interesting increase in Wi-Lan's stock (WIN-T) on Friday and today's great news that WIN settled a pending lawsuit with BlackBerry maker Research In Motion (RIM-T) and that it was sharply raising its forecasts for fiscal 2008.

The 1-year chart:

and the 30-day chart:

The last 3 days price history (close / high / low / volume):

Aug 07 1.62 1.65 1.62 48,933
Aug 08 1.78 1.85 1.62 526,705
Aug 11 2.19 2.43 1.80 1,983,473

Notice the big, 'unusual' jump in price on Friday and the nice run-up after today's announcement.

This serves as just another reminder of the value of following 'irregular' price changes that break technical patterns.

Sunday, June 22, 2008

Big Volume on TSX

The S&P/TSX Composite Index closed Friday at 14,580.67 (-209.48, -1.42%) on a volume of 392,121,642.

The high volume caught my attention as it was one of the highest volume days in the past year based on the chart below.

I guess we'll soon see if this higher volume is a pre-cursor to a bigger move in the TSX.

Retirement is for Losers

Some food for thought for those of you thinking about early retirement...

Saturday, June 14, 2008

A Car That Runs on Water

Imagine having a car that simply runs on water...

Well, you no longer have to imagine!

Earlier this week, Genepax Co Ltd revealed a car that uses its new "Water Energy System" fuel cell system that uses water as a fuel and does not emit CO2.

The system can generate power just by supplying water and air to the fuel and air electrodes, respectively. Since they are still working on the patent, they aren't providing many details on how the system actually works but its current prototype allows a litre of any kind of water - rain, river or sea - to get the engine going for about an hour at a speed of 80 km/h. With those kind of numbers, it's no surprise the Internet is abuzz about its potential.

ESET Smart Security - Save 25%

I really hope this technology is the real deal and can't wait to see these cars for sale in showrooms around the world.

Tax Freedom Day, TSX Index Changes, and Floods

Happy Tax Freedom Day Canada!

The day Canadians have paid off the total tax bill imposed on them by government and can finally start working for themselves, arrives today, four days earlier than in 2007, according to The Fraser Institute’s annual Tax Freedom Day calculations.

Canadians can calculate their personal Tax Freedom Day using The Fraser Institute’s Personal Tax Freedom Day Calculator.

Toronto Stock Exchange Index Changes

According to Reuters, six stocks will be removed from the Toronto Stock Exchange's main index, while three will be added as part of a routine quarterly review.

The changes to the S&P/TSX composite index will take effect at the start of trading on Monday, June 23, S&P said.

Removed from the index will be:

  • Crystallex International KRY.TO
  • Breakwater Resources BWR.TO
  • Aastra Technologies Ltd AAH.TO
  • Tesco Corp TEO.TO
  • Ballard Power Systems BLD.TO
  • Allen-Vanguard Corp VRS.TO.

The additions will be:
  • Birchcliffe Energy Ltd BIR.TO
  • Crew Energy Inc CR.TO
  • Iteration Energy ITX.TO.

Record Corn prices with Floods Hitting Mid-West Cities

Heavy rainfall and floods in the U.S. mid-west have in my opinion, pretty much ruined any hopes of a decent corn and soybean crop from these areas this year. It will be interesting how this weather event will effect agricultural stocks in the weeks to come as the fertilizer plays don't seem to be affected by it just yet while corn futures have gapped up a few times over the last few weeks. Ethanol stocks have already been downgraded as a result.

Tuesday, June 10, 2008

Out of Hanfeng

I sold my position in HF today to break even on the trade. Of course, it scurried on up afterwards but settled back down a little by the end of the day.

After reviewing the charts of several agricultural plays last night, I came to the realization that HF hasn't been participating in the most recent rally and the chart doesn't look too promising. I'm not smarter than the market! As such, I have revised my trading strategy; I now intend to stick to stocks that are leaders in their sectors and those sectors must be in solid uptrends. So I'll try to invest in momentum plays in the months to come and see how that goes.

Saturday, June 7, 2008

Back in Hanfeng

I've talked about Hanfeng on several occasions in the past so I won't tell its story again. I'll just say that I now have a new position in the stock.

I was banking on it bouncing off of its short-term support level yesterday (as shown in the 1-year chart below) but it of course, had to keep going down.

That's one of the downfalls of setting target buy prices for stocks when you don't have access to your trading account and want to make short-term trades. Sometimes, they work and sometimes they don't. Oh well, HF is a well-positioned company so I'm not concerned for the time being.

HF-T ended the day yesterday at $10.99 (-4.43%).

Monday, June 2, 2008

Shop Online & Get Cash Back

With gas prices soaring, more and more people everyday are doing their shopping online to save on gas money and the hassles of going to the mall.

Well, now there's another great reason to shop online:
You can earn additional savings on your online purchases!


Simply visit a site that offers to share some of their commissions with users such as yourself and you can save a bunch of cash!

From books to computers to airline tickets to hotel rooms and everything in between, these sites provide you with the opportunity to get a rebate on your online purchases.

  1. Great Canadian Rebates is probably the most popular Canadian cash rebate site.
    Before making any online purchases, visit their site and shop at over 300 of your favourite merchants and automatically earn Cash Back Rebates.

  2. Smart Canucks also offers Cash Back Rebates.
    Their program is a little more hidden on their web forum but they're there. Just look for the 'Cash Back' links on the left-hand side of the web page.
Both sites provide you with a monetary registration bonus, special promotions, and access to different retailers so it doesn't hurt to register right away and shop at both sites to maximize savings.

And while on the subject, Visa offers its cardholders VisaPerks at selected retailers online and in-store.

So the next time, you go shopping online, be sure to check out these three sites to make sure you're not missing out on any special deals.

Sunday, June 1, 2008

Is it Worth Being a Farmer?

With food prices on the rise, one would think that these are good times for farmers but think again: fuel prices have gone up, so has fertilizer, herbicide and seeds amongst others things.

Saturday's Globe and Mail looked at who is responsible for the global food crisis and as part of the article, they including a flow chart that demonstrates some of the challenges a Canadian grain farmer faces to make a living. It looks a bit like a 'Snakes & Ladders' board game that pretty much screws the poor farmer unless he's extremely lucky which makes me wonder if it's even worth the time and effort to be a farmer nowadays. One can make as much money, if not more, by playing the futures and stock markets, without getting your hands dirty and taking on that much risk. With all the games being played on the markets by the big boys, you also have to wonder if this is all just part of a bigger plan to kick small farmers off their land so the huge corporations can take over and control the entire food market from end-to-end.

So if you ate today, thank a farmer!

And be sure to buy Canadian, if not locally-grown produce, to help your small, independent farmer continue the honourable tradition of growing food for generations to come.

Saturday, May 31, 2008

Buying a New Car? You Absolutely Need This!

If you're shopping for a new car, you need to get Canada's most powerful negotiating tool.

Car Cost Canada provides Canadian dealership invoice prices to its members and can save you hundreds, if not thousands of dollars on your next new car purchase.

It's so simple too.

After registering at the Car Cost Canada web site, just select the car models you're interested to get the wholesale invoice price reports and instantly see the car dealer's true cost. Print out the report and take it to the dealership.

Since the dealer knows that you know their true cost, all their negotiation games and hassles are thrown out the window and you regain the power to get the deal you want.

"New Car Buyers stand a better chance of getting a great deal if they know the dealer invoice price" - The Globe and Mail

I know it did for me as I saved a lot of $$$ when I bought my car a few years ago with the report in my hands!

So if you're shopping for a new car, I'd definitely recommend using this handy web site to help you get a real deal.

Free US Real-Time ECN Quotes

Earlier this week, Yahoo! Finance announced the return of free unlimited US real-time ECN quotes on its web site. Kudos to them for bringing back this very useful feature!

MSN Money also offers real-time quotes but they limit it to 1,500 per month.

Meanwhile at Google, I haven't read anything about their real-time quote offerings recently but back in January 2007, they reported that they were trying to make it a reality.

Hopefully, this is just the beginning of a new real-time stock data era and we'll soon see freely available Level II quotes at your favourite online financial portal...

NOD32 v3.0 - Save 25% - Download Now

June 2nd Update:
Well, that certainly didn't take long!
Barrons now has real-time prices for U.S. stocks on its site and Google Finance announced today that it's now offering real-time quotes on NASDAQ securities.

I can only wish my blog had such power to influence :D

Tuesday, May 27, 2008

Lucky ETF Investors

Here's an excerpt from Pett's article entitled 'Investors get lucky on Claymore pricing glitch' that I came across today:

"According to Claymore vice president Jeff Logan, market makers for Claymore ETFs, including Bank of Montreal, use Reuters as a pricing vendor. He said that Reuters, based out of the U.S., had a reset or pricing glitch right at the end of the day yesterday, causing Bank of Montreal's automated trader to make markets at a much lower price than the fund's actual net asst value.

"While BMO lost money on the trading, many retail investors were able to pick up the ETF at a big discount to the net asset value," said Mr. Logan. "Bank of Montreal could have canceled the trades but given the relatively small loss, they decided not to, making many investors very happy."

In total, about 7,300 units in the global mining ETF were bought during the last minute of trading as the price fell from $25.70, to a low of $19.55. The ETF closed at $20.05. Mr. Logan said the Claymore Global Agriculture ETF was also affected by Reuter's pricing glitch, although not as drastically.

Mr. Logan said the error has been corrected and secondary pricing sources and failsafes have been put in place to prevent this isolated occurence from happening again.

Units in the Global Mining ETF are back trading above $25 to $25.20 at 12:30 p.m. ET."

I'm just wondering who the lucky investors were?

Friday, May 23, 2008

Calling Oil's Top

As per my comments on the Million Dollar Journey, the quick rise in oil prices has created a very tempting reason to try shorting oil.

The HBP NYMEX Oil Bear+ (HOD-T) and HBP Energy Bear+ (HED-T) ETF's can help you accomplish your shorting strategy but since it offers ~2x the opposite move of the commodity / index, I still haven't figured how much, if any, I should invest / gamble in it. In any rate, if I were to short oil, it would be a short-term position in my portfolio and I definitely would have to keep a very close eye on it and place a stop loss.

Another way to bet on lower oil prices would be to invest in airline and other transportation-related stocks. As big consumers of oil, they can only only benefit from lower oil prices.

But before you place your bets on a correction in oil, please keep in mind that there's a limited supply of oil and prices will eventually be higher than they are today.

Tuesday, May 20, 2008

Medical Wait List Insurance

With waiting lists for medical procedures in our so-called "public" healthcare system at all-time highs, it comes as little surprise that the entrepreneurial spirit of the private sector is now offering a means of bypassing those long line-ups.

Acure Health Corp.
offers what they like to call "Medical Access Insurance (MAI)" which according to Acure Health, is Canada's first "Wait List Insurance." According to the CBC, the insurance is now offered in five provinces, most recently in Ontario.

So What is Wait List Insurance?

According to their web site, Acure's Medical Access Insurance

"provides Canadians with expedited access to specialist consultation (see MAI Plus+), diagnostics, and surgery for over 135 treatments and conditions. Medical treatment for covered conditions will be provided in weeks, not months or years. Our policyholders are serviced independently, resulting in shorter waiting times for others... If a physician recommends a covered diagnostic procedure or surgery and you are placed on a medical waiting list more than 45 days long, MAI will arrange to expedite your diagnosis and treatment in the United States or, in Canada when services are available."
Should You Buy It?

Just like life insurance, I consider wait list insurance a personal choice but unlike life insurance coverage, you might personally benefit from it.

With that in mind, is it worth the average 75+ bucks per month for coverage?

If you come from a strong gene pool, you might consider twice but if you've ever known someone waiting for months or years for an operation and witnessed their agony, then you'll most likely say yes.

The price may be steep but in the grand scheme of things, it might be well worth it in the time and money you save in not being in pain and suffering. Keep in mind that it was originally promoted as an addition to group insurance packages for companies so you might want to try convincing your employer to share in the costs as well.

I am not an insurance expert nor a doctor, so as always, you should not rely on any information found on this blog. I encourage you to conduct your own research and consult with your physician before signing any documents. Acure Health Corp. did not commission the writing of this article.

Which Canadian Bank Should You Buy?

David Parkinson asked this question in a recent Number Cruncher article and came up with the following result:

... which banks to buy? For that, we return to well-regarded equity quantitative-analysis firm CPMS Computerized Portfolio Management Services Inc., which has crunched the Canadian banking numbers and identified the key metrics that historically have pointed to superior stock performance.


CPMS has back-tested bank stock performance over the past 10 years against a variety of quantitative measures, and found that buying stocks with the lowest price-to-book-value (P/B) ratio would have netted investors the best bang for their buck, outperforming the group as a whole by almost 10 per cent annually.

Underperformance in the previous year – as indicated by both the worst 12-month price change and the highest dividend yield, both of which suggest a relatively low stock price – also tended to point to superior returns in the year that followed, with better than 4-per-cent outperformance of the group benchmark.

Conversely, bank stocks with the best price gains over the prior 12 months and the lowest dividend yields tended to be duds, underperforming the benchmark by the biggest margins.

You can view the complete result set on the RoB site.

Monday, May 19, 2008

TSX: On the Brink of 15K

Just a few months ago, there was a lot of talk about the global economic downturn and dire warnings of a major bear market. Well, if you're an investor of the TSX Composite Index, you might be wondering what all the recession talk's all about as the TSX is within a few points of reaching the 15,000 mark. Well, I didn't expect that to happen so soon!

Thanks in most part by the latest surge in oil prices (and natural gas too), the TSX is in record territory and the question is, will the party continue...

Well, I have no idea but considering I didn't really partake in this rally in any major fashion, I am currently establishing a list of stocks (including some energy-related bear ETF's) I'd like to get my hands on if a dip does occur anytime soon.

Wishful thinking?

Perhaps, but like we have seen in the last year, stranger things have happened.

Friday, May 9, 2008

ETNs vs. ETFs

Today's RoB article about the launch of U.S. Platinum Exchange Traded Notes (ETN's) mentioned an interesting point on a key difference between Exchange Traded Funds (ETF's) and ETN's:

Investment bank UBS launched two ETNs offering long and short trading strategies in platinum. ETNs, unlike exchange-traded funds, do not purchase physical platinum to back the number of shares sold.

Investopia defines an ETF as
A security that tracks an index, a commodity or a basket of assets like an index fund, but trades like a stock on an exchange, thus experiencing price changes throughout the day as it is bought and sold.

Because it trades like a stock whose price fluctuates daily, an ETF does not have its net asset value (NAV) calculated every day like a mutual fund does.

By owning an ETF, you get the diversification of an index fund as well as the ability to sell short, buy on margin and purchase as little as one share. Another advantage is that the expense ratios for most ETFs are lower than those of the average mutual fund. When buying and selling ETFs, you have to pay the same commission to your broker that you'd pay on any regular order.

while it says that an ETN is
A type of unsecured, unsubordinated debt security that was first issued by Barclays Bank PLC. This type of debt security differs from other types of bonds and notes because ETN returns are based upon the performance of a market index minus applicable fees, no period coupon payments are distributed and no principal protections exists.

The purpose of ETNs is to create a type of security that combines both the aspects of bonds and exchange traded funds (ETF). Similar to ETFs, ETNs are traded on a major exchange (ie. NYSE) during normal trading hours. However, investors can also hold the debt security until maturity. At that time the issuer will give the investor a cash amount that would be equal to principal amount (subject to the day's index factor).

One factor that affects the ETN's value is the credit rating of the issuer. So, the value of the ETN may drop despite no change in the underlying index, instead due to a downgrade in the issuer's credit rating.

It should also be noted that structures like the Central Gold Trust and the Central Fund of Canada physically hold bullion.

Monday, May 5, 2008

Royal Bank of Canada

So I finally took the plunge and invested in a bank today. The Royal Bank of Canada (RBC-T) to be exact.

I must admit that I am not particularly confident about my entry point but as shown in the charts below, RBC's recent downtrend appears to have been broken.

Now, I could have only taken a partial position in RBC and see what happens before investing the rest but I decided against this. Since I plan on investing in at least two other Canadian dividend-paying bank stocks, I decided to invest the full amount in RBC and avoid paying a few additional dollars in commissions. If markets deteriorate again, I'll enter a position in another bank I have on my watch list. And if bank stocks have already completed their downtrend, I have picked up RBC at a yield of just over 4%.

Hopefully, ten years from now, none of this will matter with RBC hopefully reaching much higher highs and providing an ever-increasing dividend to boot.

Monday, April 28, 2008

Oil vs. US Dollar Index (Inverted)

Courtesy of Bespoke, the oil bulls worst nightmare... a stronger US Dollar

Friday, April 25, 2008

Trailing Stop Orders

This week's dip in the share value of Timminco (TIM-T) triggered my long-standing buy order on Wednesday (see the April 23rd intraday chart below).

Unfortunately, the quick run-up soon thereafter was much faster than I ever thought possible and I cashed out way, way too early as my eager sell finger was not stuck in a meeting that morning.

If only I knew I had access to trailing stop orders!

As you can see from the 5-day chart below, the stock had a pretty wild week thanks to severe shorting pressure from the professionals.

Since I didn't want to lose my quickly earned cash on a volatile stock, I sold my shares to secure my profit but I could have used a trailing stop order to provide similar protection while leaving my position open to bigger gains.

It was an expensive lesson but is one that I think will revolutionize my trading style and hopefully, lead to bigger gains in future trades.

QuickTax Ready for the April 30th Deadline?

Tuesday, April 22, 2008

Intrepid Potash IPO

After kicking myself countless times over the past several weeks for not following my 2008 portfolio plans of placing 50+% of my assets in fertilizer stocks and my quick trades for relatively small profits of the agricultural stocks I've held this year, I noticed that a new Ag. player arrived to the stock market today.

Intrepid Potash IPO'ed and shot up over 50% on its debut today. Just like I did with VISA, I've included today's action of IPI-N for future reference.

Interestingly enough, I'm finding different chart views of the market open for this stock on various web sites. I ended up using the Google Finance chart above since it appears to have the least amount of noise on the open.

I haven't had any time to do any research on this company just yet but for those interested in reading up on the company, 1440 Wall Street appears to be covering the story very well.

Monday, April 21, 2008

Watch for a Flip in Real Interest Rates

In a Market Blog posting, David Berman refers to John Hussman's weekly market comment, and states:

On that note, Mr. Hussman – who worked at the Chicago Board of Trade in the mid-1980s – is particularly bearish. He believes that the commodity bull market will shift into reverse within a few months, when the yield on the 10-year U.S. Treasury bond rises above the year-over-year inflation rate, as measured by the consumer price index.

In other words, he believes that commodity prices will be in trouble when real interest rates flip into positive territory from negative territory. At the moment, the 10-year benchmark bond is yielding 3.7 per cent and the CPI was 4 per cent year-over-year in March, meaning that real rates are slightly negative – which is widely identified as one of the drivers of the current commodities boom.

Something to keep an eye on...

Sunday, April 20, 2008

Happy Earth Week

To coincide with the start of Earth Week, I thought I'd mention a piece of software called GreenPrint I just came across...

GreenPrint is a simple idea, but it solves a problem nearly everyone can relate to: The ubiquitous wasted page. This is the page with just a URL, banner ad, legal disclaimer, etc. These wasted pages occur many times a day littering homes and offices around the world and wasting money, trees, and time.

In an effort to end wasteful printing worldwide, GreenPrint World is available at no cost to home users around the globe. With widespread use we will save over 100 million trees and reduce greenhouse gasses by over 300 million tons. The World Edition is perfect for anyone who wants to eliminate the frustration and waste of unwanted pages and have a positive environmental impact right at home.

GreenPrint provides a simple solution to printing to PDF. This preserves the document format including web pages without wasting paper. This PDF writer is also incorporated into the print preview so any document can easily be saved to file (after eliminating wasted pages) rather than being printed. For most users, this will also eliminate the need to buy a separate PDF writer such as Adobe Acrobat.

GreenPrint also integrates a reporting function that allows users to easily monitor their printing habits in order to quantify the dollars and pages the software has saved.

Saturday, April 12, 2008

Agrium Hit Resistance

Last week, I picked up a few shares of Agrium when it appeared to have broken out of its down trend. Well yesterday, AGU-T hit an obvious resistance point of around $75 that it couldn't pass through with any real conviction.

The quick move to the upside yesterday triggered my sell order.

While I still believe Agrium could go higher, I couldn't resist taking profits at such an obvious resistance point and lock-in a nice gain. In the very short-term, it looks like I made a wise choice. But when it comes to the longer term horizon, I've been wrong many times before. It's a great stock in a hot sector so we'll see what the markets bring us next week. Hopefully, they'll give me an opportunity to get back into this stock at a lower price.

AGU's April 11th Trading Range: $72.00 - $75.20 (Closed at $73.19).

Wednesday, April 9, 2008

Global Fertilizer Conference

If you're interested in learning more about the agricultural fertilizer market and how you can potentially profit from the currently booming business, BMO Capital Markets held its 2008 Global Fertilizer Conference on April 2nd where leading fertilizer companies (including Agrium) offered an in-depth global perspective on the sector’s current challenges and future opportunities.

Moderated by Chemicals & Fertilizer Analyst Edwin Chee of the BMO Capital Markets equity research team, this webcast includes presentations and panel discussions that may be of interest to you.

Saturday, April 5, 2008

Tax Filing Time

If you're like most Canadians and myself, you dread April since it's that time of year when you are expected to file your taxes.

Well, this weekend is the perfect time to sit down and get your income tax return out of the way. Who knows, maybe the government owes you money so you're losing out. I personally like to fill out my taxes the old fashion way on paper first, and read up on all the various deductions and credits available so just maybe I can do something differently this year. Once I think I've got it all done, I like to double-check my return with one of the online tax software packages like QuickTax

The online version of QuickTax allows you to fill out your return for free; you only pay if you actually want to file your return with them.

So if you just want to get your taxes done as quickly as possible or want to double check your calculations, you might want to give QuickTax a try.

QuickTax, Find Deductions!

Agrium Breaks Down Trend

I've been keeping an eye on Agrium (AGU-T, AGU-N) for quite some time but never actually pulled the trigger. That is, until this past Thursday afternoon. As you can see in the 6-month chart below, AGU broke out of its down trend on Thursday and signaled a buying opportunity for me.

Typically, I would wait until the next day to buy a stock exhibiting such a pattern to confirm that its closing price actually broke the downtrend but my gut instinct told me to get in there (plus work commitments would prevent me from following the market opening on Friday morning). Well, luckily for me, AGU gapped up on Friday thanks to a competitor (and partner) reporting quarterly numbers that exceeded analysts' expectations.

Agrium is a major retail supplier of agricultural products and services in North and South America, a leading global wholesale producer and marketer of all three major agricultural nutrients and the premier supplier of specialty fertilizers in North America through their Advanced Technologies business unit. Agrium’s strategy is to grow across the value chain through acquisition, incremental expansion of its existing operations and through the development, commercialization and marketing of new products and international opportunities.

As mentioned in an earlier post, Agrium also has a 19.6 percent equity position in Chinese specialty fertilizer company, Hanfeng Evergreen.

Interestingly, Recognia's Technical Events Report gave a target price range
of $87.00
to $91.00 for AGU-T after Thursday's close.

StockCharts noted on Friday that AGU-T had a double top breakout
based on their Point and Figure chart pattern (below) giving a
preliminary bullish price objective of $87.

It might be tempting for me to grab some profits before that 'target' is reached so we'll see what the markets do and how I react.

AGU-T Price Range on Thursday, April 3rd: $63.50 to $67.50 (Close: $66.75).
It closed yesterday at $70.01.