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Found some of my FA work:
http://www.siliconinvestor.com/stocktalk/msg.gsp?msgid=18317423
http://www.siliconinvestor.com/stocktalk/msg.gsp?msgid=18254827
Kyros also has a post on Zeev's thread right now.
When looking at RRI one way to examine their financial health is to see the rate they got on their Oct refi vs their peers. You can bet the banks poured through the books. 1/2 the debt coming due in Feb is from 3 major banks that already gave money to RRI in Oct. Hmmmm...
Look at PETM 5 year chart. This isn't a play to use TA except for picking short term entry points. I've seen far too many longs exit at 2.1, 2.5, 3, 3.5 etc. I won't sell a share for less than 10-12, but more than likely I'll raise that target if the Bush dividend play goes through as RRI may start to pay a dividend in 2004 imho.
Of course this could still go to 0 if the banks say no, but wouldn't RRI be selling assets now if there was any doubt? They can always go to the loan sharks in a worst case scenario like WMB.
>> JRH, what do you think of RRI? <<
You can analyze RRI from an TA standpoint all you like, but the real story is in the FA.
FWIW, my portfolio is about 50% RRI, 50% gold stocks. It's been this way for the past 3 months. Between SI and yahoo you'll find all the FA you need if you dig a little.
You'll need to go back about 1 month on the yahoo board and you'll find some surprisingly good info. Kyros is the main person to follow, but there are plenty of other good contributors as well. Do your own DD.
It's both a sector play and a special situation.
My basis is 1.85 and considering how overloaded I am I'm not buying any more. For new buyers I'd wait at the minimum for the gap to fill around 3.8, but I think we'll probably visit 3.5 or lower one more time. Tough to call since it's news related.
msloft, that's why I've restricted myself to one play within the utes sector which I consider a far more compelling value than it's peers. I do think overall the sector will fare better than the overall indexes, but I'm by no means buying up the entire sector. Same with gold I'm extremely selective here due to political risk, valuation, hedging, and debt.
The utes traded down to a 14 year low last year in Oct. On a relatively valuation basis can you say the same about any other tech sector?
>> Nice day for the bears and gold players. <<
And utilities and IPPs. DYN, one of the weakest plays in the sector gave upbeat CC early this week. S&P said odds of survival and now better than 50/50. The worm has turned.
No DYN myself, but I think if DYN can survive than RRI will have no issues getting their upcoming refi.
Gold and utes in 2003.
Thanks. First link I've seen.
Any news out related to the sudden US Dollar drop?
http://quotes.ino.com/chart/?s=NYBOT_DXY0&v=i&w=5&t=l&a=10
It would appear that gold spiked prior to the US Dollar drop today. Maybe the Fed is buying gold and walking the Dollar down while Japan is buying our Dollar. Now wouldn't that be a hoot.
Seriously, any news? A drop that sudden is typically news related.
Thanks for the well thought out response regarding SA gold plays. I don't disagree entirely with your logic. I realize the chances of nationalization are relatively remote (5-20%?), but I typically take overweighted positions in fewer stocks. As such I don't want to take on the "extra" risk of SA plays for the potential of additional gain over my NA plays. I have been in this sector almost from the bottom 2+ years ago. In that time I have played HGMCY and DROOY several times. However, now that I'm playing with much larger amounts of money I'm no longer interested in taking on as much risk.
Overall I think KGC, WHT, MNG and BGO will reward me well. I don't expect them to all be the highest % gainers of the sector at all times, but I do suspect they'll readily outperform the HUI and XAU.
Good luck w/your positions.
Said the same thing about silver...but a couple hours previous. Guess he wanted to position himself more. Bought the last of my WHT position yesterday so I'm extremely happy today. Didn't have to chase anything today.
http://www.investorshub.com/boards/read_msg.asp?message_id=651064
>> So a 15% move on an investment in 1- 2 years..maybe? <<
Miners tend to move 4-5% for every 1% move in gold. Many of the juniors are still trading at discounts relative to $350 gold as there is still some skepticism. Not to mention there are very few gold stocks in terms of total market cap and if everyone decides to get just slightly involved in the sector it will explode upwards.
Gold has only moved from $250 to $350 or about 40% yet KGC is up almost 600% from it's lows. Hmmmm. Guess I should still to preferreds... LOL.
I think GG and RGLD are more than fully valued here. MNG is still undervalued, but it's somewhat hedged so it may take higher prices before investors really climb on. That said it's my 3rd largest PM holding. I like KGC and WHT here the best. I'm avoiding South Africa plays due to polital, economic, and nationalization concerns.
>> George, the CB's have had their "way" with gold for some 50 years now, except few interruptions, think they will continue and manage gold to their end. <<
Unlike other commodities gold is one of the few that actually gets more demand as the price rises. In every other gold bull investor demand has far outstripped any decrease in demand from jewerly. Besides CB's may be able to dampen gold prices, but at this point they can't do much about the falling US Dollar. Attempts to prop it up will only delay the inevitable. Since gold is priced in Dollars I think a minimium move in gold to $400 is almost a given within the next 1-2 years. Beyond that CB may try to play their games again. Then again, some CB's may actually add to their reserves at much higher prices (this has been the case in many other gold bulls).
You have a 20 year trend that has only reversed itself in the last 2 years. Yet somehow it's over because the CB's have controlled gold for 50 years? Don't think so.
As I have said before (and other's said it before me) Greenspan wants a higher gold price to show that deflation is not the problem. What that level is I'm not quite sure yet, but I doubt he'll be able to "control" that level once the gold bull is in full swing.
Gold shares have been strongest in the morning and at the close. This has been the pattern for quite some time now. I expect a nice close. However, not sure what issues you are watching because many of my plays are up strong already.
BENGB.ob is 20 mil in market cap. How many times are you going to spam it on this board? I haven't looked into too deep yet, but I'd put at most 1%-2% of my gold holdings in anything that small. Plenty to be made on larger micros that are 100-300 mil in market cap. You seem to have an agenda.
WHT, KGC, BGO, MNG and PAAS are all up nicely and they have liquidity to boot.
Silver looks like it's breaking out. A close above 4.85 should send it back over $5 again sooner than later. Not interested in selling anything yet. As this recent move in gold and silver has proven both are hard to time short term. Since I think we are only in the 3rd inning of a multi-year run in precious metals why bother. Gold has been the number 1 performing sector for the last 2 years and it's gone relatively unnoticed in the media. Avoiding producers I consider expensive (GLG, GG, RGLD, MDG). Sticking with a basket of micro's.
WHT my second largest play in the PM sector is behaving very nice.
>> Therefore, I will deem Team George the winner if (kindly note that I omitted the "when") $700/oz is accomplished. <<
Ridiculous. There are very few gold bugs who advocate a long term approach (multiple years) to holding gold. I think most would take quite a few profits after 100-200%+ moves. Most of the gold bugs on these boards are relatively new. I have only been involved in gold in the last 2+ years. To say most gold bugs have been holding for the past 6+ years waiting for a turn is silly especially when many good traders use stop loss points.
Zeev has missed out on plenty of easy doubles, triples and more due to his macro view of gold. I think victory has already been had by the gold bugs. The question now becomes how much more profit is out there? Anybody with an ounce of TA skills could have seen this move coming. I think Zeev has made some good tech calls, but his views on gold have prevented him from claiming some very nice profits.
Gold has outperformed every other sector the last 2 years. You could have been fairly sloppy and still made substantial money. It certainly beats trying to time long positions in a down market. Gold indexes will see new highs once $360 is broken. Only a matter of time imho when you look at the fundamental and technical underpinnings.
Pull up a 10 year chart of gold. Pretty damn clear T/A. The recent consolidation/breakout of the XAU and HUI was also very clear. I expect at least 400 before this run is over, but much more could be achieved. However at 400 I will probably scale back and let much smaller position run. Currently about 50% gold stocks.
Currently long KGC, WHT, MNG, BGO and PAAS (in that weighting).
My current portfolio allocation fwiw.
http://www.siliconinvestor.com/stocktalk/msg.gsp?msgid=18393480
>>>OT - Per our earlier discussion, weren't we supposed to get the best prices on RRI in the last few weeks of the year?<<<
I never took positions in MIR and AYE. Still 50/50 RRI and gold stocks. I think gold is still going substantially higher and like RRI I'm not going to try to time it.
Point noted on MIR, AYE, CPN regarding tax selling. It would appear that we were both correct...to a degree.
OT - Per our earlier discussion, weren't we supposed to get the best prices on RRI in the last few weeks of the year? Glad I didn't wait. I can say I told ya so since we've both profited nicely. ;)
Of course the White House is going to say that. If not we'd be looking at a mass exodus out US markets and the Dollar. In truth they want a weaker Dollar, but they want to walk it down slowly.
Haven't sold any gold, but will add if 330 seen again. This is very likely a multi-year trend going foward. To play $5 swings doesn't appeal to me now that we've broken out over $330.
Bernard, I was referring to Miramar (MNG) not MYNG.
Bernard, what's your opinion of MNG if you don't mind?
I'm of the same opinion regarding the gold bull. I currently own KGC, PAAS, BGO and MNG. MNG is my smallest position, but I've heard conflicting views about it's value.
MNG is about the smallest I'll go in terms of liquidity/market cap size. Hope you do well with your micros though.
>> heading higher into Uncle Al's (created) headwind...
<<
But gold's tailwind will be stronger. Producer buybacks, bullion bank buybacks, higher investor demand (will outpace reduce jewerly buying), and I'm predicting that some CB's will begin to buy back gold reserves before it's over. That's been the pattern with all the gold runs in the past 100 years. They sell at the bottom and hoard at the top. If the Malaysian Dinar goes into circulation then gold will have a HUGE tailwind.
Also, easy Al wants to show that deflation is no threat. He'd rather have $400 gold than $250 to show that USA will not fall into Japan's trap. The Fed knows how to tame inflation...it can do little about deflation once it takes root.
Long KGC, PAAS, BGO, MNG
JMHO.
>> The sudden move in the POG ... <<
What's sudden about it? It's taken 2+ years for gold to move from 250 to 330. Given the US Dollar, valuations, economic climate, fiscal policy, war on terrorism, consumer and corporate debt loads it should be well over $400 now.
Of course when a commodity has been in a bear market for 20 years it takes some time to "wake up". The next 2-5 years should be very good for gold.
Being 1/2 gold I'm liking this...just a tad.
Check back at my posts. I was bullish on gold some time ago. I was accumulating again around Thanksgiving. Also sold EP for a nice gain. Missed the top, but made over 50% on the majority of my money in a short time period. Now have an overloaded portfolio position in RRI with a basis of 1.85. 1/2 RRI, 1/2 gold. I still think you're a complete idiot, but not because you're bullish on gold.
Give it a rest. Gold at 310 was a misprint. It should be obvious. Look at the Dollar index.
However, if you'd like to panic and sell me more shares at $310 prices I'll be happy to take them off your hands.
SSRI has always been a trader for me. I like HMY and DROOY, but am somewhat leary of holding South African issues due to nationalization/political concerns. Both should do well if gold breaks out. I sold the last of my DROOY into this recent rally.
Re: Tax selling of utes. It seems to me that in watching the action of past years that tax selling is largely over by early to mid Dec. Most of the big blocks get sold way before then. It's pretty obvious when an issue is going to get sold for tax losses so why be the last seller. Of course individual investors think a little differently. I don't think we're going to see lower prices than some of the recent "corrective" lows on many of the utes and IPPs, but it probably is a good time to slowly accumulate on any weakness.
Given AYE's action and the fact that MIR reports this week I think today is a pretty good day to buy for someone who doesn't have an initial position. The IPPs should start a decent near term run on any positive news out of MIR.
Thanks again for all the research on RRI.
MIR reports this week. AYE got upgraded hence the strong sector showing in a weak market. I'm about 50% RRI here and 50% gold stocks. Rather aggressive, but I can't find any other IPP, util that I like nearly as much as RRI. Short term, MIR would be my 2nd choice in the utes, but mostly as a trader. Unlike other IPPs, RRI has not had to sell any assets. They have 2.7 bil coming due in Feb. Unless they were simply negociating terms, they'd be looking to sell some assets...just in case. Given that they're not selling assets and they just refi'd in Oct on favorable terms this one looks very good. I plan to hold till at least 10+.
Basis in RRI is around 1.85. Have KGC, PAAS, BGO, MNG in golds.
RRI is my #1 holding right now. I'm also going to doing a LTBH with the majority of my shares as selling for anything less than $10 is really short-sighted.
RRI is currently my only long position other than gold shares. I'm not short yet, but if we continue much higher I may short the indexes, but unlikely individual stocks as I'm not a fan of shorting.
It's been a nice 2 months as I've rotated from EP to RRI with the majority of my money. Have made some on golds, but didn't sell enough at the last short term top.
General question on hedge funds:
Does anyone know of any funds that participate (refund) on the downside as well as the upside? Seems that most of the funds ask for 1% of assets and 20% of the returns. Just wondering if there are any funds that charge say 10% of the gains, but give back 5% of the losses?
I don't expect to find any, just curious.
>> JPM initiated coverage on four gold stocks today, to wit: <<
They must not be done accumulating NEM, KGC and DROOY.
mlsoft, as you know I was mostly kidding around with you about not shorting for the most part. I really respect the quality of your postings.
Eventually you'll be right shorting this rally. Always had a tough time of it myself.
Rich, I'm currently long HGMCY, KGC, DROOY, PAAS and SSRI. I like a few others but the volume is so small I'd rather not mention them. In general you don't need the thinly traded plays to make money in this sector though. I'd rather stick w/liquid issues.
mlsoft...forget shorting and get on the gold bandwagon. My account hit another new high today outpacing the gains in the overall market. Of course I'm almost 100% gold shares now. :)
>> I guess you're assuming the current market properly values the current economic condition <<
Well said. Have enjoyed reading your posts of late. Not sure I agree with the target this soon (long term, yes), but ANY new low on the Comp or even a full retest would be very disheartening for the bulls here.
Not short, but very long gold here. I think regardless of what the market does there are good reasons to own quite a bit of yellow here.
>> Elections over tomorrow, Greenspan over day after tomorrow. So who's left to pump after the news is out? <<
Cisco will get one more chance on Wend.
Not short here, but have been long gold for the past couple weeks. Have slowly gained while the market has gained, but I expect more upside when the markets, the Dollar and bonds all head south again.
Or maybe gold and the Dollar are moving because they would go that direction regardless whether Greenspan cuts or not.
Weak econ news without a cut should also send the Dollar lower and the markets lower thereby sending gold higher. I don't think this next push will take us over $330 though. Seems like we'll need one more pullback after this move is over. However, breaking gold over $330 on this run would probably guarantee that most of the gold bulls would miss it.
Time to add more gold. Dollar index breaking down again. If the FED cuts, both gold and the market may rally initially, but long term Greenspan only makes the credit bubble that much worse. 11 cuts and no substantial improvement, but the 12th cut is going to make the difference? Don't think so.
http://quotes.ino.com/chart/?s=NYBOT_DXY0&v=i&w=5&t=l&a=10
If the Fed doesn't cut, then gold wins in that scenario as well as the market heads south.
Again out of QQQ short for small gain at 24.65. Should have taken gains earlier.
Anyone know the estimate GDP # tomorrow? Are they "setting the bar" low or high?