Tag: trading

How not to go to jail for insider trading

I’m not going to jail for trading in Novell. In fact, I’m not going to trial, there will be no indictment…hell, I’m not even going to be investigated.

Several years ago I identified Novell as a buyout target. I will not go into my reasoning, but let’s just say I did so before it actually became a buyout target. I accumulated some shares, and sat tight. The stock languished.

Not even on my radar, I received a notification of the upcoming shareholders meeting. I reviewed my position in the wee morning hours, and concluded it was time to bail. I’m still not going into my reasoning.

Twelve hours later Elliott Associates LP, a fund that holds an 8.5% stake in the company, offered to buy the rest of it for roughly $5.75 a share. The stock hit $6.15 in after hours trading.

I think I got between $4.75 and $4.85 for my shares. During normal trading hours. I won’t be looking at those confirms again.

No steak dinner for me.

The Blue River’s “significant other” on Black Monday 1987

In Colorado fly fishing circles, the name Jones is oft mentioned when discussing a conspicuously maintained section of the lower Blue River.

Lower Blue River via satellite

Actually one of Colorado’s gold medal waters, this section of the Blue is accessible only by raft. The optimum flow conditions for a safe float are a closely guarded secret, and you best be a very experienced (and well insured) oarsman if you try. Reason? The river is littered with huge protruding boulders and man-made weirs, and you can’t stop and/or set foot in the stream bed as it’s almost all private property. By the way, those weirs were built to keep the river’s inhabitants happy, and the occasionally catches of some of the larger [cough, choke, cough, cough] denizens forced locals to nickname the stretch Jurassic Park.

I’ve heard this significant portion of one of the finest trout waters imaginable called the Dow Jones property, but it has nothing to do with the Wall Street-esque publisher. No, the Jones property is owned by one Paul Tudor Jones, an avid outdoorsman who also happens to be a pretty [cough, choke, cough, cough] wealthy hedge fund manager.

A PBS special on Mr. Jones, aired in the late 80’s, was on YouTube for a bit – it’s since been taken down due to a copyright claim, but I did get a chance to see the first clip which ended just before Black Monday, 1987. Anyone want to venture a guess as to how Mr. Jones and his fund fared that fateful day?

Trading places, fly fishing style (UPDATED)

There was a time when I lived in a place with few fly fishing opportunities. So I spent a lot more time traveling, often collecting gear in advance I wound up not using. Where I live now there is plenty to offer, and while I’m not opposed to travel I know I’ve barely scratched the surface close to home. With that in mind I’d like to do some trading, preferably flies for flies. Here’s what I’ve got in inventory (click on any pic for a bigger view)…

Big Deceivers with tandem hook option Tube flies and rigs

Poppers in various colors and sizes Miscellaneous teasers/lures

From top left: 1) Big deceivers (2/0) in a couple of different colors; wired for tandem hook rig, and includes an additional hook; 2) 5X tube flies in chartreuse and pink/white; includes 4 X 4/0 tandem hook rigs (wire/shock); 3) Poppers (2/0 & 2) in various colors/materials; and 4) some miscellaneous lures and teasers, the latter of which work great for getting roosters to the beach (with the hooks off, of course).

Everything is new. If you’re interested in any of these flies/etc. let me know in the comments, along with what you’d like to trade for. Leave a valid email with your comment and I’ll ping you back right away. You can also contact me directly here if you like. As for what I’m looking for? Easy…Stacked Blondes, Cougars, and Sex Dungeons (what else does a guy need?). Of course, staples such as buggers, princes, RS2s, WD40s, chronomids, etc. cause less pain, and I’d love a pile of black conehead rubber buggers too.

Happy trading.

UPDATE: About a dozen poppers are gone.

Tuesday Tidbits – October 7, 2008

The rally that wasn’t

  • Jim Cramer called the end of days. He’s widely considered such a dope that whenever he says something peoples’ first reaction is to fade his advice.
  • The Federal Reserve is now letting non-financial enterprises step up to the trough. I give credit where credit is due around here – Nouriel Roubini called this one last week on the RiskMetrics webcast.
  • More credit: Henry Blodget and Company have been saying web advertising would take a hit, and they’ve been saying it for a while. You can continue to question the thought, but while you’re pondering Facebook’s COO says the web needs a new business model (albeit late), and VCs are still trying to sell free. Results from the second half of this year will certainly shed some light on the subject, but I wouldn’t bet against the Alley Insider right now.
  • The rich are hurting too, and “the rich” includes institutional investors like pension funds. Take their actuarial perspective towards funding, throw in an alternative investments market including hedge funds and private equity (that have either gone neutron or can’t find an exit with flashing neon signs), and then lop on top an S&P 500 that has (as of today) been flat for a decade, and you’ve got a recipe for retirement ugly.
  • Bad credit: Mortgage equity withdrawals closed in on zero for the second quarter of this year. I’ve heard more than a few stories about equity lines of credit being shut down even when there has been no drawdown at all. The good part of this is people won’t be digging themselves deeper into debt at a time when they should be concentrating solely on getting out. The bad part of this is that the consumption-based economy will suffer. For the rest, there’s always eBay and Bill Me Later.
  • And last but not least…

  • Government gives handouts, but previously hat-passing Wall Street is now going to say no thanks? No wonder there was so much pork in the bailout bill. Congress can’t seem to get much right, and their timing is just as bad. Good thing they’ve got the blame game to fall back on.

Adieu.

Trading Data is Worth More Than Trades?

Quote via Reuters, as noted by Paul Kedrosky:

The moves by NYSE and Nasdaq OMX come at a time when the exchanges are seeking to generate as much revenue as possible from market data, which now makes up for a larger share of revenue than equities trading. At Nasdaq, market data generates 20 percent of revenue, while at NYSE, the figure is 14 percent.

Call me Mr. Skeptic today, but something is amiss here. While a Kedrosky blog commenter asked “where’s the trading revenue data,” I’m more inclined to wonder about the rest…

Based on the Reuters statement, if data is a greater percentage in both cases, then at the NASDAQ data revenue plus trading revenue must be equal to or less than 40% of total revenue, while at NYSE the two combined would be equal to or less than 28%.

Where does the other 60% and 72% of revenue, respectively, come from?

BoA in Talks to Buy CountryWide Financial

Trading Rule #1: Never, Ever, Ever, Under Any Circumstance, Add to a Losing Position.

Yep. Number two would cut losses quickly, and number three would be double up on your winners. Even casual casino gamblers can win, if they do this while understanding and following game fundamentals.

UPDATE: The deal is now underway – it’s an all equity transaction at a hair under one share of B of A for each five shares of Countrywide priced out at around $7.20. CFC fell to $6.33 by the end of the day today, which could suggest some think the transaction will wind up more dilutive to B of A shareholders than management does. Meanwhile, Robert Shiller is questioning the whole deal – you can’t help but believe such skepticism has a solid foundation attached when it comes from him.

Russian Should Regulate Trade In Viruses

Yesterday, the Russian stock exchange was shut down by a mysterious virus. Around the same time, we find that Russians were selling the WMF exploit on the “black market” for four grand a pop.

Maybe Russian investment bankers should create a publically listed security for computer exploits. Hackers would quit screwing with the trading systems, because their portfolio would depend on its function?

Trading Yourself

Hong Kong travel agents have created a secondary market for hotel rooms, but it lacks an electronic platform. If the progress that has been made in the last decade with trading technologies is any indication, someone will jump on this soon.
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Reuters IM shut down by worm

For those of you that think instant messaging attacks are no big deal, catch this…

Yesterday, a new strain of W32/Kelvir worm worked its way into the Reuters news agency’s secure enterprise IM platform, forcing it offline. It could not have come at a worse time for Reuters.
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