Investors everywhere have been eagerly awaiting the Fed's next interest rate cut, and the wait ended with a bang thanks to a bigger-than-expected half-point cut. The markets soared on the news, and we want to know how it affected your portfolio and your trading strategy. What stocks are you buying and selling? And how does this change your outlook?

-The markets soared on the news, so my portfolio
-My trading strategy remains the same and has not changed since the start of this competition;
it's near to: buy and hold, holding 20 stocks.
-I have no intention of buying any new stock, some adding to or trimming of existing holdings, maybe.

I continue to believe that my DryShips, Inc. (DRYS) Strategy Lab Open portfolio stock will benefit as the Marine industry is cyclical and so the lower interest rates will be healthy environment for its business.
DRYS, Days Held 51, Inception Return 26.40%

RIO SID PCU XTO are the stocks I believe will benefit as well

Undoubtedly, the Fed was very aggressive in cutting rates what is a strong stimulus for the markets as result; more to come, in my opinion.

Comments: View Comments |  Wednesday September 19, 2007

You Don't Need An Education to Get Rich?

New York Times article by Louise Story, offers a variation on the theme. It says that with so many quant whizzes getting rich at hedge funds and private equity firms, many of today's best and brightest -- or at least the mathematically gifted -- are skipping M.B.A.'s and going straight to the trading desk.

There is no doubt that the article suggests education isn't really everything, but not much of a lesson either. Not only the connection between education and wealth breaking apart but the Plato quote dating 427 BC as well. Why? As per his words a hero is born among a hundred, a wise man is found among a thousand, but an accomplished one might not be found even among a hundred thousand men. The most probably a hedge-funders here are heroes with a short shelf life, too.
Undoubtedly, a kind of panacea I wouldn't take counsel, albeit their apparent skills. Consequently, one might question their attitude, too.

Comments: View Comments |  Tuesday September 18, 2007

The Fed's decision about whether and by how much to cut its short-term interest rate target next week is a topic everyone is willing to predict or put down various scenarios in concert with as much ifs too.In a larger perspective a cut in interest rates next week by the Federal Reserve will improve financial conditions and further support growth and the global economy will sustain the U.S. expansion..Nothing very unfamiliar in it, the Fed is doing its job, an academic explanation might follow. In one way or another, the markets are going to react quite emotional, regardless of any decision.
Just one decision in any September imaginable has little impact on the decisions a long term investor might take, for that reason I don't play the Fed before at all, better to play Business Cycle Expansions and Contractions, the economy is going to face in the aftermath of Fed decision, if any.

According to NBER the committee determined that a trough in business activity occurred in the U.S. economy in November 2001. The trough marks the end of the recession that began in March 2001 and the beginning of an expansion. The recession lasted 8 months, which is slightly less than average for recessions since World War II.

What I note here is that one will be better off in the long run by stomaching recessions(don't last forever) and aggressively invest in such corrections. Maybe I'm wrong but I continue to run my portfolios at marketocracy that way, being buy and hold majority of time ; for this competition as well.

Comments: View Comments |  Thursday September 13, 2007

weakness...
The Oil, Gas & Consumable Fuels industry is cyclical in nature and is one of the most important globally what suggest a risk to the investors in such companies. XTO downside risks include declining net income and fluctuating energy prices, too. Close to two-thirds of the world's energy needs are satisfied by hydrocarbons (crude oil and natural gas), I believe that a tight supply conditions are going to persist well in the future and oil prices will be elevated and are expected to remain so as global economic growth progresses.

XTO is a large independent exploration and production company focused on unconventional natural gas resources It also has proven reserves of oil, with its steady growth, ever increasing reserves, and superb management. For example, the average reserve-to-production index of proved reserves is 16.3 years. In general, these properties have extensive production histories and production enhancement opportunities. The company has limited exploration costs to wisely acquire property on which there are proven reserves. XTO does this better that it's competitors. XTO relies on its experienced team of geologists, seismologists and drillers. It translates to a strong growth, so XTO Energy's Q2 FY07 revenue rose 24.8% year-over-year to $1.33 billion, from $1.07 billion. The increase resulted from a rise in revenue from its Gas and Natural Gas Liquids and Oil & Condensate segment. Revenue from the Gas and Natural Gas Liquids segments soared 29.3% to $1.02 billion. Oil and Condensate revenue rose 9.8% to $281.00 million. Gas Gathering, Processing and Marketing revenue spiked 36.4% to $30.00 million.
North America has only about 3% of the world's natural gas supply and natural gas cannot be easily imported. There have been no new natural gas facilities to come online for a number of years. It is a reasonable conclusion that supply and demand will cause the price of natural gas to gradually rise. This is exactly what has happened. XTO has generally been able to increase its reserves by 20-25% year over year.
In addition, a solid guidance and acquisition of both producing and unproved properties from Dominion Resources for $2.50 billion suggest its 2007 production growth target to 17.0% These properties are located in the Rocky Mountain Region, the San Juan Basin and South Texas.
strenght...
An easy understandable business XTO is showing up here, isn't it!..

That's why XTO has been selected to take part in my ASTRA quaityx20 portfolio.

Comments: View Comments |  Tuesday September 11, 2007