Week #4
Dancing between first and second place in the US market our focus needs to shift to the Canadian market heading into week four. Our gold ETF’s and silver ETF have been good in terms of long term value and growth. Based on their performance, and reports that the price of gold will continue to increase we have selected another Gold ETF. Horizon Betapro Comex Gold ETF, HUG.TO.
GO GO GOLD!!! Along with HUG.TO we bought 1000 shares of iShares S&P/TSX Global Gold Index ETF, GDX.TO. With two gold ETF’s in our Canadian portfolio we predict performance to reflect the success we have had with commodities ETF’s in our US account.
Everything Apple produces is basically gold. From the smallest iPod to their most powerful computers they constantly innovate and dominate the market. With the introduction of the iPad personal tablet we predict that going into the Christmas season Apple is a winner.
Week four marks the half way point in the stock game. We have seen profits thus far and believe that at this point we can handle taking loses to get out of “bearish” markets.
mOOPS!!
Accidently shorted BWC.TO at $8.25, was a mistake during some buying on Tuesday… lost the commission fee of shorting and covering but nothing else.
Sold Research In Motion in the US and CAN markets at high prices making decent return on investment considering our strategy there was simply in and out, buy low sell high.
Speaking of highhhhhh… we bought some POT this week ;).
Corn shortages caused by dry unfavorable soil conditions in the United States made corn prices rise on the commodity exchange. The supply of corn was falling causing demand for corn to rise. “But mister, what does corn have to do with pot?” Well Farmers rely on potash fertilizer for when fertilizing corn crops across Canada and the US. So we can say that potash fertilizer will be in higher demand to combat the dry conditions of soil.We looked at several potash companies in Canada and the US markets. Bought Potash Corporation of Saskatchewan (POT.TO) in our Canadian account.
POT.TO one month chart.
In our USD account we bought CF Industries Holdings, which is a Potash fertilizer producer operating within the US. We will be holding Holdings.
Moo.
Definitions:
Pac-Man Defense
What Does Pac-Man Defense Mean?
A defensive tactic used by a targeted firm in a hostile takeover situation. In a Pac-Man defense, the target firm turns around and tries to acquire the other company that has made the hostile takeover attempt. This term has been accredited to Bruce Wasserstein, chairman of Wasserstein & Co.
Investopedia explains Pac-Man Defense
This term comes from the Pac-Man video game. In the game, once Pac-Man eats a power pellet he is able to turn around and eat the ghosts that are chasing after him in the maze.
When one company makes an unsolicited and aggressive bid on another publicly traded company, the takeover attempt may not be welcomed by the targeted firm. In an attempt to scare off the would-be acquirers, the takeover target may use any method in an attempt to acquire the other company, including dipping into its war chest for cash to purchase the other company's stock.
What Does Tunneling Mean?
An illegal business practice in which a majority shareholder or high-level company insider directs company assets or future business to themselves for personal gain. Actions such as excessive executive compensation, dilutive share measures, asset sales and personal loan guarantees can all be considered tunneling. The common thread is the loss to the minority shareholders, whose ownership is lessened or otherwise devalued through inappropriate actions that harm the overall value of the business.
Investopedia explains Tunneling
This risk is especially prevalent for investors in emerging markets, where government and regulatory controls may not be sufficient to stop the practice from occurring, often under legal guises. The practice is not reserved to moderately advanced economies; many instances can be found in advanced economies, especially those under systems of "civil law". The U.S. legal system is rooted in "common law", which provides broad enforceable laws with simple maxims like "fairness" and "for the common good". Under civil law, the letter of the law is the most respected measure, so would-be tunnelers can pass an act of tunneling off under certain technicalities, which often hold up in court.
Yuppie
What Does Yuppie Mean?
A slang term denoting the market segment of young urban professionals. A yuppie is often characterized by youth, affluence and business success.
Investopedia explains Yuppie
Coined in the 1980s, the term yuppie was used as a derogatory title for young business people who were considered arrogant, undeservedly wealthy and obnoxious. Yuppies were often associated with wearing high fashion clothing, driving BMWs and gloating about their successes. The term has become less of a stereotype and now promotes the image of an affluent professional.
