Zeev and All:

I mentioned a few months ago I took a position in NFI
http://investorshub.com/boards/read_msg.asp?message_id=3081547
and now I'm in a quandry. I purchased 5000 shares at an average $33 and now the stock sits at $44 for a gain of $55,000 since May. I've also received two dividend payments for $6750 for a total of $13,500 gain from dividends. So on a $165,000 investment I've realized $68,500 in just a few months.

Do I sell or wait for the next dividend?

http://www.nfi-info.net/

TT

Hey Train Guy:

NFI claims they aren't affected by rising interest rates like tradional REITS...and her is why..

There is much confusion in the marketplace over the impact of refinance activity on NFI’s business. The company has stated in its conference calls that the sub-prime and alt-a segment is not nearly as rate sensitive as the conforming and Jumbo-AAA segment. Folks with 720 FICO scores will refinance every ¼ to ½ point drop in interest rates, as they are the cream of the borrowing crop and can command the very best rates at any time. Great for them, but that’s not who NFI lends to. And that’s not the type of loans NFI makes, for the most part. NFI specializes in making mortgage loans for sub-prime and alt-a borrowers, wherein the refinance is typically either a cash out or a debt consolidation — moving higher interest rate debt to lower rate mortgage debt, and securing a tax deduction in the process (mortgage interest is deductible, whereas credit card debt, etc. isn’t.) These types of borrowers are not historically as interest rate sensitive as conforming and high FICO borrowers. If they can move 14% credit card debt to a 7% mortgage loan, they have won big already. And because NFI has pre-pay penalties on many of their loans, there is a financial disincentive to frequent refinancing. According to my last interaction with IR, refinance activity impacts less than 5% of NFI’s business. The prepays mitigate even that, so the actual impact of a decline in refinance activity that you hear about in the media is negligible for NFI. That’s just not their business.

From: http://www.nfi-info.net/

Train Guy,

NFI has a very different lending model than other REIT's. If you are inclined that http://www.nfi-info.net/ has a lot of information.

TT

Train Guy:

I wish you well if you decide to swing trade NFI.

Being the novice that I am I can't figure out why 51% of the float is short (9,000,000 shares) http://www.nfi-info.net/news.htm and the company keeps breaking records on their monthly originations.

TT

extelecom:

That was an interesting response? Calling my hometown the armpit of the earth? Funny I guess? Actually the campus is quite beautiful. I'll be visiting my aging parents (both in their 90's) and cousins Aunts and Uncles next weekend.

I do have a stop in @$33 on my pet NFI which is my average cost.

TT

Hey Train Guy,

You may be on to something with swing trading NFI. Just hold on to it on ex-dividend date.

I don't have the time to watch the market 24/7 like you guys. I have a regular job. I'm content with the idea of investing $150k of idle money and reaping $30k per year in tangible returns. It seems that kind of return is a pittance here with trading experts such as yourself.

I'm just excited with NFI because it actually pays. My other investments are mostly flatlining this year.

TT

Zeev: Keep those prognostications coming. I think they are a hoot, you sticking your neck out there. Anyhow, three of my colleagues follow you now on IHUB (two actually paying members). One is actually following your trades as best she can with what you post here.

Keep it coming, thanks

TT

Oh just collected $6750.00 from NFI in my quarterly dividend payment.

Bruce,

You seem to know more about NFI than the average poster here so I'd like to share another posters opinion about the hedge fund (Rocker Partners) that has taken a huge short position in NFI.

See below:

A poster tonight suggested that the enourmous "bet" taken by some shorts ought to give us pause and make us think that maybe there is a little something to it. Well, shorts and bashers have been saying this for some time, and on the off chance that someone is reading this board that doesn't know the story, here is my best guesstimate about how, when and why Rocker got it wrong.

I am thinking that Rocker is not an idiot, he just got a little over confident and greedy on this call, that's all. He has/had a nice little thing going -- short the crap out of some thinly traded stock that is very difficult to understand and held by very conservative investors, publish a smear campaign and then exit with a tidy profit. It would have worked if he had been happy with a 50% profit about 2 years ago, but he wasn't. He stayed in the game, probably thinking that he could make even more money on these poor KC backwater hick executives running this company. Then these stupid hicks went and raised the divvy what was it, 60% in one quarter? Oops, bad call by Rocky boy. He has been struggling to stay alive ever since, and I don't think that he has much longer to live.

See, I don't think that he ever actually thought that NFI was a scam, I'll bet it never even crossed his mind. He saw a complicated company trading about 50,000 shares on a busy day and thought he had some easy pickings. How was he supposed to know that they would increase earnings 50-100% a year for the next 7-10 years? No, he knows that this company is no scam -- the best he could do was find that one page on their website was not updated in a timely fashion, then brought a lawsuit based on that.

Like I said before, he has lost a ton of money on this greedy, arrogant bet, and he continues to lose on it quarter after quarter. The reason he hasn't exited yet is not that he is waiting for the collapse of NFI, it isn't because he is making money on the swings (remember, he keeps on forgetting to cover every time the price goes down), there just isn't a way out other than bankruptcy or the apocolypse.

Rocker is a smart, powerful, well connected guy who just bit off a little more than he could chew here, and it must be causing him some sleepless nights. Hard to admit to a group of very wealthy people who gave you money to invest that you pissed it all away betting against some KC hicks running a mortgage company, huh?

Train Guy,

I thought Zeev was retired because he seems to be here 24/7. So what? I didn't know he had 42 patents either? Like I said where I work we have dedicated eggheads who research and work years developing patents, published and then move on to another obscure project. Doesn't seem to matter how many patents you have, but how many patents are viable in the money making world. Since you brought up that subject how does Zeev fair in that realm?

My attraction to this daytrading board is that it doesn't seem like everybody is daytrading, even Zeev has some core holdings. And I wonder why NFI isn't one of them?

I'm pumping NFI because I'm a shareholder and would like to see the price go up.

TT

Burk:

Hey we were darn good in baseball this year.

Does Zeev follow sports?

TT

http://texastech.collegesports.com/sports/m-basebl/spec-rel/070204aaa.html

Train Guy:

Zeev is an inventor, Oh?

Well where I work I'm surrounded by Phd's who "invent" apply for patents, receive grants and go on to the next "invention", while spending other peoples money. All the time thinking up other, newer "inventions" to win grants and perpetuate the intellectual cycle of redundancy.

No, I don't have the time to day trade and invent at the same time?

Yes, I am diversified but am still fascinated with the NFI story. I've asked Zeev about NFI but he is as clueless as me at identifying the pros and cons of REIT's.

TT

http://www.nfi-info.net/

DAU:

Yes there is an incredible percent of short interest in NFI nearly 50% of the float yet the company is growing at an incredible rate and the dividend rising? http://finance.yahoo.com/q/ks?s=NFI

Go figure?

TT

http://www.nfi-info.net/

Hi Zeev,

Wow you spend a lot of time trading in and out of stocks. Is retired life that boring? Are you retired? I ask that because it seems you are here 24/7 doling out trading tips to the needy.

I'm fairly heavy into NFI and don't have the skills or time to day trade and have been totally consumed with the national lab crisis.

Anyhow, your cohorts should check NFI and see whether there is hope there.

http://www.nfi-info.net/

Zeev:

No I'm not going to cull the thread. If you were interested in transparency you would have your trades available in a spreadsheet format.

Whoever caught the biggest one conversation are just fine. Keep up the good work.

TT

Sherlock,

geez, where are you coming from?

Good night,

TT

Zeev,

I read and re-read your post, just english challenged I guess. I'm just giving you kudos for doing so well in a down market. We're down 10% to 17% from 1/1/04 depending on what index you use for comparison.

My old broker had the same trading talents as you but he never delivered for my folio, just his.

Keep up the good work and I'll follow. Sorry you don't follow NFI.

TT

Zeev,

I read your post but I wonder if you read mine. You said "so I am keeping more or less even"..... "In this down market", like my old broker used to say, never lost money in a down market. Just like you.

Congrats!!!

TT

Zeev,

Feel better? No not really, but you do remind of a broker I once had that never lost money in a declining market.

You're just the only guy I know who makes money day end and day out and never hedges.

Do you feel better?

TT

Hi Zeev,

You remind of my old stock broker. He was one of those guys that never got hurt in a declining market. I really wonder what your stake really is? Doesn't matter I suppose just imaginary trades anyhow.

Anyhow, I've felt the sting of late. I'm content to increase my holdings in NFI a little at a time. Looks like year-end with dividend and bonus of a yield of 20%. Wonder how your trading compares to that return.

TT

Zeev,

I like you, am clueless as to the direction of this market. NFI my major trading stock has a short interest of about 50% of the float (unchanged from last month). Yet it pays a 13% dividend (to be raised on 7/29 I hear) and the stock has risen 25% or so in the last month. Shorts must be worried? I HOPE???

Go Figure?

TT

Zeev:

Sorry about the market of late. Time to plow in those turnips this year. Anyhow I hope at some point you'll quit ignoring me on my NFI pick. Had you paid attention you'd be collecting some nice dividends and seen some great appreciation lately.

Sorry about your losses. My index portfolios sucks too.

TT

I know this bores most of the stellar traders here but I think NFI another kind of REIT is worth looking at. Here is a post from the author of this website http://www.nfi-info.net/

God Bless,

TT

About NFI

We have been the beneficiaries of the wisdom of those that shorted this small company in KC, MO. At that time, July, 2002, the dividend was 40 cents and the logic was that the loan quality and the market segment in sub-prime made it a disaster waiting to happen. Since then, of course, those that shorted so aggressively at $18 down to $9 have learned that the segment and the company are not so easy to read, that loan performance is significantly better with NFI than many prime lenders, that NFI's delinquencies are one fifth what CFC's sub-prime delinquencies are, and that the company has grown the portfolio by almost a factor of 5 since that initial assault.

And here we are. Almost two years later, and one and a half since I first bought, and the same shorts are still calling into question the company's ability to perform - ignoring completely the last two years. The dividend is in question, they will tell you, with the same sincerity they employed two years ago. It's all a scam they will advise, with your best intentions at heart.

Two years of calling all the fundamentals wrong. Pretty amazing. Getting in so deep that they had to pull out all the stops and call in every media and lawyer favor they could muster to take this down to where they can exit. And yet they still couldn't get completely out.

So here they remain, their prognostications of doom no wiser nor more convincing than 23 months ago, putting in the hours, trying to talk us down.

The fact is that we have seen a portfolio developed which will pay us for many years, an origination strategy which is replacing loans at roughly a 3 to 1 clip as they drop off, and a dividend which is inevitably destined to continue growing as the portfolio does. Margins will shrink a bit, but growth will carry the day, as it has thusfar. As long as the company is able to add loans at a more rapid rate than they drop off, even if the margin on the new loans is 1/2 of the old, we win big for years to come.

Oh, and there's always that little detail of all the securities written down to 0 that threw over $10 million just last Q. Look for that to increase substantially over the next 8 Q's.

So here we are, again and still, being paid to watch and wait. Not a bad place to be.

Zeev,

Are you averse to income producing stocks? I asked you about NFI on 5/14 which pays an annual dividend of $5.40 per share 15% per annum or so. The stock is up $5.00 since I mentioned it. Maybe something this boring holds little interest here?

http://finance.yahoo.com/q/hp?s=NFI
http://www.nfi-info.net/

God Bless,

TT

Zeev,

Please be careful on doling out advise on exposure. I'm under exposed here because of the uncertain geopolitical climate, bulldozing of peasant homes in the Gaza, car bombings in Baghdad, weak leadership from Bush, oil manipulation by the Saudis, looming interest rate hikes.

This is a good time to be on the sidelines.

Good luck and God Bless,

TT


P.S. Your rally will come but maybe not before further decline.

Zeev,

We'll get a short term bullish bias here soon. Your three month wait won't be in vain. Thank you for sticking your neck out there and making predictions. I couldn't do that, I see how often you are humbled. But even though your market timing is weak your daytrading is stupendous. I'm in awe of your expertise every day.

Thanks for guiding us,

God Bless,

TT

Zeev,

Like I said before you will be eventually right (about your spring rally) but you've been bullish since 4/30 http://investorshub.com/boards/read_msg.asp?message_id=2988697 and the Naz has been grinding ever since http://finance.yahoo.com/q/hp?s=%5EIXIC&a=03&b=30&c=2004&d=04&e=22&f=2004&am...

I think I'll wait for some renewed interest before I redeploy.

You're a spectacular trader, you are the only person I know that makes money in this grinding market! And never short to boot!

God Bless,

TT

Zeev,

Boring me. Still on the sidelines.

How do you deploy heavy in premarket when you're already at 5% or 10% cash? Does heavy deployment mean margin or adding 5% to an already stressed portfolio?

God Bless,

TT

Zeev's percentage of cash has remained at 5% to 10% during this last three month NAZ grind down. I'm more concerned about cash preservation and may wait for further decline. Zeev doesn't have any dry powder since he's fully deployed. I'm holding on to my ammunition a little longer. Futures look terrible today.

Zeev,

Here is your March bottom call http://investorshub.com/boards/read_msg.asp?message_id=2643339

Here is your April bottom call http://investorshub.com/boards/read_msg.asp?message_id=2962091

And your May bottom call http://investorshub.com/boards/read_msg.asp?message_id=3096262

I'd say 3rd time is the charm. I too am looking for a short-term rally.

All the best, and God Bless,

TT

Zeev,

Here is your March bottom call http://investorshub.com/boards/read_msg.asp?message_id=2643339

Here is yor April bottom call http://investorshub.com/boards/read_msg.asp?message_id=2962091

And your May bottom call http://investorshub.com/boards/read_msg.asp?message_id=3096262

I'd say 3rd time is the charm. I too am looking for a short-term rally.

All the best, and God Bless,

TT

Zeev,

You don't seem to play in any of the income producing stocks? REITS are out of favor of late but there is one REIT that supposedly won't be as affected in a rising interest rate market. The symbol is NFI. I took a position the other day to take advantage of this qtrs. dividend currently producing a yield of 17% per annum. The stock is @ $33 today and the yearly dividend is $5.40. There is a stock holder maintained website @ http://www.nfi-info.net

Sorry if this info. has already been discussed.

God Bless,

TT

You may be right, April 8 high was 2074 yesterday we sat at 1896. My point was capitol preservation in these volatile times. back to the Oil Field.

God Bless

Zeev we've fallen nearly 10% on the naz since you predicted a bottom http://investorshub.com/boards/read_msg.asp?message_id=2962091

Eventually Zeev, your prediction of a powerful rally will come to be, but, I am more interested in capitol preservation for now with this uncertain global climate. Your stops must have been hit over and over again these last few weeks. Glad for now to be on the sidelines.

Good luck and God Bless

Goodness Zeev, when will you bite the bullet and admit you were off base. You've been expecting a bullish bias for last 500 point drop in the DOW. You've been at 5% cash for the last two weeks. What do you have left for goodness sakes.

God Bless

Zeev, FWIW I'll give you my opinion for Dec. I'm honored that you solicited my opinion. You do have a friendly abode here.

I'm not sure about the Autumn low but I have 1913 for 12/1. 1852 for 12/15 and 2003 for 12/29. Buttttt, that depends on the geopolitical climate and how things are progressing in Iraq. I'm worried about the volitility in Israel between now and then. It seems some political factions in Israel are itching for some attention, which could throw the whole region into a #@%^#. And oil prices throw a wild card into the world economy future that no one has a handle on.

I hope you had a peaceful Easter.

God Bless

Hi Zeev,
That post was "selective memory" I went back further and found you had the NAZ between 1900 and 5200 from since April 2000, and that has been accurate to date. Also, we haven't breached your DOW ranges of 6000 or 13,500 in the last four years either. Sorry. http://www.siliconinvestor.com/stocktalk/msg.gsp?msgid=13483082

Those ranges you predicted are a little general and large distances between, where anyone short or long could make and lose a fortune.

IMHO I don't think this year may be the best for any long-term gains for index investors because of the uncertain geopolitical climate. Just like your miscalculations of the market directions in 2000 the year 2004 could bode just as ominous.

I hope you have a great Easter and God Bless.

Zeev, Do you think this election year is different from 2000. You missed that years prediction by a wide margin. You thought we would head up (bullish) into the election and beyond. The naz was at 3966 when you made the bullish call and finished the year at 2470 a miss of 1496 points to the wrong side. http://www.siliconinvestor.com/stocktalk/msg.gsp?msgid=13945394

I am of the opinion we slide down into the end of the year because of the uncertain geopolitical climate. If one terrorist act is successful on the homeland we lose 500 points on the naz in short order.

IMHO.

Interesting. Done some consulting there.