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they tagged 1060 last thur. they will jam it
as high as they can by fri. 1100 1105 1110 ect.
maybe pull the rug out next week ? or not
good work Glen you da Man
I agree... also they just happen to go
ex div on quad opex and sp 400 .. 600 rebalance
SPY is trading ex div. today.
SPY dividend .59019
Ex date 12/18/09
Thanks smilinghiker
THANKS // !!!!!
The BOYZ parked spy @ 106 "EXACTLY"
tomorrow the battle is 107 or spy 105 for opex
they tagged 107 on the 23 rd
so maybe they will go for 105 or not
SPX closed below 320 DMA
ONTY now has options 5.00 & 7.50 out till Feb.
Ron Walker not giving up yet
http://thechartpatterntrader.com/
Another call on H & S
http://thechartpatterntrader.com/
THANKS GLENO,
your posts and input is
appreaciated.
thanks
OT: charts
Could you or eagle put the dates
above the volume on the daily chart?
It would make it easier to follow.
THANKS
January 21, 2007 - 3:57 pm is the date of article.
Good background info for newbies.
just above 22.50 strike down to
7.51 {7.50} strike then starts back up
until halted,
hmmmm, normal NOT
Thanks Glen034, You are THE MAN
uso vs usl
http://biz.yahoo.com/indexuniverse/090209/5362_id.html?.v=3
IndexUniverse.com
Don't Buy USO (Buy USL Instead)
Monday February 9, 10:59 am ET
By IndexUniverse Staff
I have nothing against people wanting to buy oil at $40/barrel. That's a cheap price, and there's reason to believe that spot crude may rise over the next six-to-twelve months. OPEC appears to be sticking by its production cuts, overall supply is down and it feels like the global economy may be leveling off. Oil could easily go to $50/barrel, which would be a 25% jump from here. Where else in today's market are you going to get that kind of return?
But if you want to profit from that rise, USO isn't the way to do it.
This is a big deal. According to the Wall Street Journal, investors poured $3.46 billion in new money into the U.S. Oil Fund (NYSE Arca:USO) in December and January. That makes my hair stand on end, because those investors have gotten crushed. And if things stay the way they are today, they're going to continue to get crushed.
The reason, as I've written about time and time again, is contango. The oil market is in violent contango right now. All else being equal, any strategy that focuses on buying the front-month futures contract and rolling it forward is going to lose money. A lot of money.
This is simple mathematics, and it pains me that people are missing the story.
Here are the current prices for oil contracts with expirations in the next six months. Notice how every contract is more expensive than the one that preceded it. USO follows a simple strategy of buying the current contract and then rolling into the next contract before the current one expires.
March 2009
$40.42
April 2009
$46.22
May 2009
$48.88
June 2009
$50.45
July 2009
$51.28
August 2009
$52.70
Source:NYMEX. Data as of 2/9/08.
Until last Friday, USO owned the March 2009 contract. Specifically, it owned 84,378 March contracts, entitling it to 84.4 million barrels of oil.
But on Friday, it sold all those contracts and bought the April contract instead. But because the April contract cost $6/barrel more than the March contract, it couldn't afford as many contracts. In fact, if you exclude new inflows into the fund, it could only buy 73,444 April contracts.
Whammo presto, the holders of USO lost 13.4% of their exposure to crude oil. They now control less oil. If the spot price stays near $40/barrel, the value of those April contracts will decay back to $40/barrel over the next month and investors will lose their shirts. If the price of oil jumps 15% in the next month—before USO rolls again into the May contract—investors will only break even.
This contango effect killed oil investors in January, according to Standard and Poor's, which runs the most important commodity index in the world.
"The steep contango in the WTI crude oil futures market (when further-out futures trade at a premium) was the primary factor causing the S&P GSCI Crude Oil Index to decline 18.90% in January. The spot price of crude oil dropped 6.55% on the month, but rolling from the February to the March future contacts accounted for most of the remaining 12.35% of the decline in the component index."
Got it? Contango cost you 12% in January. And it's worse now.
What's so horrible about watching people plow their money into an investment that they don't understand is that there are so many nice, viable alternatives out there.
The same company that offers USO offers a great little fund called the U.S. 12-Month Oil Fund (NYSE Arca:USL). Rather than simply holding the near-month futures contract, USL holds equal positions in each of the next 12 months' worth of futures contracts. Spreading out its bets like that helps minimize contango, which tends to be worse in the near-month contract, and gives you more direct exposure to the spot price of crude.
Not surprisingly, over the past three months, USL has outperformed USO by 13%.
How Contango Affects Crude Oil ETF's and ETN's (USO, OIL, DBO)
The following is a Guest post on MarketFolly.com.
hijacked from 'Market_Technician' by Bud Fox then by Cha-Ching
'tradefast' is the nickname of an independent equity trader who has more than 20 years of market experience at a major financial institution and 2 hedge funds. He now trades for a private investment fund, using a combination of both fundamentals and technicals. (That sounds like our kinda guy!)
He sat down to explain how contango affects the crude oil ETF's and ETN's many investors and traders usually play, including USO, OIL, & DBO. He writes,
"The US Oil Fund (Ticker: USO) holds long positions in West Texas Intermediate crude oil futures contracts, and rolls these contracts forward each month. Like most futures traders, USO buys futures with leverage, putting up a small portion of the money to buy the contracts. The rest of the money is invested in Treasuries, which generates interest income for the fund.
Three factors play a role in determining the performance of USO: 1) changes in the spot price of crude oil, 2) interest income on un-invested cash, and 3) the 'roll yield'. The first two factors are easily understood, but the third factor, 'roll yield' should be examined further in order to determine the extent, if any, to which traders of USO will be surprised by its performance in relation to spot crude oil.
First some background: Oil futures are available for each month of the year, so you can buy a futures contract right now which gives you the right to buy oil in February 2009, March 2009, April 2009, and so on. Currently, the price of oil in February 2009 is less than the price of oil in April 2009, a condition which is referred to as 'contango'. (If the opposite were true, the market for crude oil would be in backwardation.) Most commodity funds, including the US Oil Fund (USO) buy what is called the 'near month' contract and, because they do not want to take physical delivery of the commodity, they sell the current month's contract before it expires and buy into next month's contract. This process is called 'rolling forward', and it can result in the ETF paying up if the forward month contract is higher than the current month (contango), or cashing out if the opposition condition exists (backwardation).
To investigate the issue, I read through the 'risk factors' section of the USO prospectus. The following is relevant:
in the event of a crude oil futures market where near month contracts trade at a lower price than next month contracts, a situation described as ‘‘contango’’ in the futures market, then absent the impact of the overall movement in crude oil prices the value of the benchmark contract would tend to decline as it approaches expiration. As a result the total return of the Benchmark Oil Futures Contract would tend to track lower. When compared to total return of other price indices, such as the spot price of crude oil, the impact of backwardation and contango may lead the total return of USOF’s NAV to vary significantly. In the event of a prolonged period of contango, and absent the impact of rising or falling oil prices, this could have a significant negative impact on USOF’s NAV and total return.
In essence, the USO prospectus is warning traders that USO may experience a negative 'roll yield' which may cause the NAV of USO to deviate significantly from the spot price of crude. Is there historical precedence for USO deviating from spot oil by a material amount? As it turns out, the answer is 'yes'.
During the past two years, including 2006, these markets have experienced contango. This has impacted the total return on an investment in USOF units during the past year relative to a hypothetical direct investment in crude oil. For example an investment made in USOF units on April 10 and held to December 31, 2006 decreased, based upon the changes in the closing market prices for USOF units on those days, by 23.03%, while the spot price of crude oil for immediate delivery during the same period decreased 11.18%
The conclusion, at this stage of analysis, is that USO is not a direct play on the spot price of crude oil - it is, instead, a play on the spot price, forward prices, and the relationship between spot and forward (the slop of the futures curve).
For a trader who is long USO, my instinct is that maintenance or aggravation of the contango in crude oil will cause impairment of the value of USO in relation to spot crude - whereas, any mitigation of the contango situation (including a shift to a flatter curve or backwardation) will enhance the performance of USO.
I plan to study this issue more extensively. But, in the mean time, I will not consider USO to be a good proxy for the spot price of crude oil - and I will be particularly leery of participating in USO for anything other than a short term trade."
'Tradefast' highlights an issue that many have overlooked or just not taken the time to research. Many perceive that USO is the "best way to play oil" since it's the front-month contract. But, as he points out, there are some issues with this ETF, depending on how crude oil is trading in the front month and beyond. So, as always, read the prospectus of each fund you're trading or investing in. It's important to understand what exactly it is you're dealing with.
In the comments section of his original article, he goes on to address similar issues in other crude oil ETF's and ETN's. Regarding ticker OIL, he writes,
"Here is a link to the prospectus for OIL, the IPath crude Oil ETN.
The 'contango issue' is discussed on PS-10. Short answer: yes, a contango market in crude oil will result in negative roll yields - similar to USO.
Also, be aware that OIL is an ETN (exchange traded note), rather than an ETF (exchange traded fund). With ETNs, you are an unsecured creditor of Barclays (the issuer of the note), so you have credit risk overlaid on the risk of the commodity.
In a former life, I used to enter into total return swaps on various indices with Lehman as the counterparty. I halted this practice long before LEH became a troubled credit. My sense is that the popularity of ETNs have fallen in relation to ETFs, because of the credit risk.
I have no strong opinions regarding Barclay's default risk, but it might be worthwhile to consider that Barclays CDS widened by a meaningful 98 bps on Friday, and the stock declined 24%. Although the current CDS spread of 265 bps is not indicative of extremely high default risk, the level and direction are cause for some concern. (Barclays credit risk can be hedged with CDS, but this is a market for instititional investors - and shorting Barclays stock against a long position in OIL exposes the OIL holder to unacceptable basis risk. Ergo, I would prefer ETFs (such as USO) over this specific ETN (OIL)."
He also addresses the Powershares ETF: DBO, writing,
"I took a quick glance at DBO from PowerShares. In the prospectus, PowerShares notes the following:
Rather than select a new futures contract based on a predetermined schedule (e.g., monthly), each Index Commodity rolls to the futures contract which generates the best possible ‘implied roll yield.’ The futures contract with a delivery month within the next thirteen months which generates the best possible implied roll yield will be included in each Index. As a result, each Index Commodity is able to potentially maximize the roll benefits in backwardated markets and minimize the losses from rolling in contangoed markets.
My interpretation of this statement is that the manager of the ETF utilizes a certain amount of discretion with respect to the futures roll. If the forward curve were humped (i.e. backwarded to some point, and contango thereafter), a skillful manager might be able to take advantage. I do not claim expertise in this area, but my observation is that the current market in Crude Oil is in contango as far as the eye can see, and there does not appear to be any immediate advantage to having a selection of forward contracts with which to complete the roll. Also, keep in mind that with active management comes potential advantages (the manager may make a skillful maneuver) and potential risks (the manager may screw up and underperform the benchmark).
Currently, I am not commenting on the leverage associated with DBO, it is beyond the scope of this particular topic (contango effects on crude oil ETFs and ETNs)."
Great insight from tradefast. We definitely appreciate his effort to research and write about each of the various popular ways to play crude oil in equity markets. We feel this is an important topic that needed to be addressed, seeing how so many people trade or invest in these ETF's/ETN's without even blinking an eye. So, thanks again to tradefast for the guest post.
http://www.marketfolly.com/2009/01/how-contango-affects-crude-oil-etfs-and.html
cha-ching
4 th M M just came aboard
Pert.... Pershing LLC
Luminent Suspends All Payments to Unsecured Creditors While Analyzing Restructuring Options
Tuesday July 1, 5:46 pm ET
PHILADELPHIA, July 1 /PRNewswire-FirstCall/ -- Luminent Mortgage Capital, Inc. (OTC Bulletin Board: LUMC - News) announced on June 24, 2008 that the company is faced with the necessity of restructuring and recapitalizing its balance sheet to place the company on solid ground for future growth. Today, the company announced that as it analyzes its restructuring options, it will suspend all payments to unsecured creditors.
ADVERTISEMENT
This news release and Luminent's filings with the Securities and Exchange Commission contain forward-looking statements that predict or describe future events or trends. The matters described in these forward-looking statements are subject to known and unknown risks, uncertainties and other unpredictable factors, many of which are beyond Luminent's control and are based on the information currently available to Luminent's management. Luminent faces many risks that could cause its actual performance to differ materially from the results expressed or implied by its forward-looking statements, including, without limitation, the possibilities that interest rates may change, that principal payment rates may change, that Luminent may experience unanticipated margin calls, that the collateral securing its indebtedness may become illiquid with a resulting drop in value, that Luminent may not be able to maintain its qualification as a REIT for federal income tax purposes, that Luminent may experience the risks associated with investing in mortgage related securities, including changes in business conditions and the general economy, and that Luminent's strategies may not be effective (including portfolio management and hedging strategies and strategy to protect net interest spreads). Luminent's filings with the Securities and Exchange Commission contain a more complete description of these and many other risks to which Luminent is subject. Because of those risks, Luminent's actual results, performance or financial condition may differ materially from the results, performance or financial condition contemplated by its forward-looking statements. The information set forth in this news release represents management's current expectations and intentions. Luminent assumes no responsibility to update or revise any forward-looking statements, whether as a result of new information, future developments or otherwise. The content of this press release is qualified in its entirety to the appropriate documents filed with the SEC on Form 8-K.
ADDITIONAL INFORMATION
Luminent LLC, an affiliate of the Company, has filed a Form S-4 registration statement with the SEC, which contains a preliminary proxy statement/prospectus relating to the Company's 2008 annual meeting of stockholders and other relevant documents in connection with the proposed restructuring. The definitive proxy statement/prospectus will be mailed to the stockholders of the Company when it becomes available. STOCKHOLDERS OF THE COMPANY ARE ADVISED TO READ THE PROXY STATEMENT/PROSPECTUS WHEN IT BECOMES AVAILABLE AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION.
The proxy statement/prospectus and other relevant materials, when they become available, may be obtained free of charge at the SEC's web site at www.sec.gov. In addition, investors and stockholders may obtain free copies of the documents by contacting Karen Chang, Luminent Mortgage Capital, Inc., 1515 Market Street, Suite 2000, Philadelphia, PA 19102; telephone: (215) 564-5900.
The Company and its directors, executive officers and other members of its management and employees may be deemed to be participants in the solicitation of proxies from its stockholders in connection with the proposed merger. Information concerning such participants' ownership of the Company's common stock will be set forth in the proxy statement/prospectus when it becomes available. This communication does not constitute an offer of any securities for sale.
Contact:
Karen Chang
Senior Vice President &
Chief Financial Officer
Phone: (215) 564-5900
Email: ir@luminentcapital.com
--------------------------------------------------------------------------------
Source: Luminent Mortgage Capital, Inc
Points of Note So far.... by sravenzz
1) Realized loss of 2M from sale of ABS.
2) REIT taxable income is about 5M this Q.
3) As suspected the new accounting standards pushed us closer to positive BV.
4) Looks like they may have started securitization again though at a very small level. It seems like they have done 10 loans and 1 CDO (pg 54 and 58).
5) The have gotten rid of the securities which were problematic and now assets are around (4.7B from 5.4 see contractual balance at page 20 Borrowings but the fair value is at 3.8 due to SFAS.).
6) Finally people have noticed the black scholes model and that it is not a direct shares * .18 math for the warrants.
7) Net Interest income is now at its lowest levels but that may go up slightly in the next quarter due to better current spreads. To give you an essence of why I say this, net interest income was at 8m this Q but the last Q it was 16m but the Interest income is 76.7 compared to 94.8 on dec 31st. So proportionally according to the last Q spreads an 8m should have been around 47.4m but we generated 76.7 and we still had only 8M this is due to the expense involved.
8) They portfolio is now significantly de leveraged since the crisis. Means lesser risk of margin; however the market is still going down.
9) Warrant liability is at 13.6M.
I am trying to compute possible BV but it is not easy this time due to the BSlooking very different, I suspect since we have improved in our realized loss section it is more or less the same. I will let you know if I see more points of interest.
lee that was my 1st post
don' let the yahoo board get to you
The facts and the truth WILL prevail
good afternoon been following this board
for 9 months looks like the smart posters are coming on
over from yahoo little by little.
GLTA longs