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TranceAddict Investors Club @ Marketocracy (pg. 80)
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| Krypton |
| quote: | Originally posted by Shakka
You're speaking about something that you obviously aren't well versed in.
Naked shorting (as the SEC is framing it) has never been legal. They have simply outlawed something that was already outlawed.
Naked shorting by a market maker is a different concept which has only served to add liquidity and order to a complex and fast-moving market place.
Now people are crying to re-implement the uptick rule, but to make it a 12-tick rule or something completely outrageous. How about instituting a downtick rule to prevent manic run-ups in stocks, eh?:whip: |
From what I understand, it's shorting stocks that haven't even been borrowed. And it's currently illegal for a short list of I think 19 financial stocks. |
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| Krypton |
Turkcell is up 15% today after buying an 80% stake in Belarus's state-owned mobile operator BeST. I don't call bottoms, but I did call when this stock was under valued.
| quote: | Originally posted by Krypton
Here is my #1 pick for June 2008...
TKC - Turkcell Iletisim Hizmetleri A.S. (Turkcell) - $19.48
http://www.turkcell.com.tr/
Turkcell Iletisim Hizmetleri A.S. (Turkcell) is a provider of mobile services in Turkey. The Company provides mobile voice and data services over its global system for mobile communications (GSM) network. As of April 1, 2008, Turkcell provided service to its subscribers in 197 countries through commercial roaming agreements with 576 operators. The Company provides wireless and value-added mobile communications services to subscribers throughout Turkey. Subscribers can choose between its postpaid and pre-paid services. As of December 31, 2007, Turkcell had approximately 29 million pre-paid subscribers and 6.4 million postpaid subscribers. The Company has investments in Azerbaijan, Georgia, Kazakhstan, Moldova and the Ukraine.
INTRINSIC STRENGTH: 91%
GRADE: A
RATING: STRONG BUY
INTRINSIC VALUE: $30.19
TAKE-OVER VALUE: $35.14
This one has great fundamentals, is diversified, and is selling at a very cheap market value compared to what the company is really worth. The company has been in a perpetual long-term uptrend for the past 5 years. Recently it has dipped from $27. This represents a buy opportunity in my view.
This stock basically fits into my mantra. High quality, low price. Look at TKC for yourselves. I'm putting down 20% of my portfolio in TKC.
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More research on TKC...http://www.turkcell.com.tr/en/inves...nvestinTurkcell
Company Qualities
1. Approximately 57% market share as of December 31, 2007 in a 3 operator environment.
2. By far the strongest operator in brand image, customer satisfaction, network coverage and profitability.
3. Offering exposure to six other high growth markets with additional population of approximately 80 million on top of sizable 70.6 million people in Turkey.
4. Solid operational & financial performance with large subscriber base and high margins.
5. Recorded revenue of US$6,328.6 million, EBITDA of US$2,627.1 million and net income of US$1,350.2 million for the year ended December 31, 2007.
6. As of December 31, 2007 number of subscribers has reached 35.4 million
7. The only company in Turkey with NYSE listing as a result complying with Sarbanes Oxley as well as local capital market requirements.
8. Superior advantage against competition in terms of coverage and capacity with population coverage of 97.8% as of December 31, 2007 of which approximately 81.3% is EDGE enabled.
9. Leading provider of mobile communications services in Turkey in terms of breadth, usage and quality of Value Added Services and one of the pioneers in the world with innovative products.
10. Established dividend policy. The Board of Directors of Turkcell intends to distribute cash dividends in an amount of not less than 50% of Turkcell's distributable profits, based on the financial statements prepared in accordance with the accounting principles accepted by the Capital Markets Board of Turkey, for each fiscal year. On February 27, 2008, the Turkcell Board of Directors decided to recommend distribution of cash dividends in an amount of approximately TRY648.7 million (approximately US$546.0 million as of February 27, 2008) representing a 14% increase compared to approximately TRY567.0 million (approximately US$411.9 million) a year ago. This corresponding to 50% of Turkcell's distributable income of the current year, based on the financial statements prepared in accordance with the accounting principles accepted by the Capital Markets Board of Turkey. This dividend proposal is to be evaluated and decided upon at the Ordinary General Assembly of Shareholders to be held on April 25, 2008. This represents a net and gross cash dividend of TRY0.2948699 (approximately US$0.248165 as of February 27, 2008) per ordinary share with a nominal value of TRY1 and approximately TRY0.737174 (approximately US$0.620412 as of February 27, 2008) per ADR.
The market
1. Robust economic achievements; inflation rate falling from 70% levels to 8% levels and interest rates falling from 100% to 20% levels in 2001 and 2007 period.
2. Political stability with commitment to structural reforms, EU accession process, strong IMF relations and more FDI's coming into the country.
3. A unique investment opportunity with its impressive GDP growth in recent years.
4. Expected GDP growth to continue at approximately 5% levels going forward vs. 2% in average in Europe that is about EU15 countries .
5. Suggesting further room for growth with approximately 88% mobile line penetration as of December 31, 2007, one of the lowest penetrated markets in Europe .
6. The youngest and most dynamic population in Europe with around 35% of the population below age 19 forming a great base of future potential.
7. Continuous population growth in Turkey compared to negative growth in other emerging countries. |
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| Krypton |
I recommended Vaalco when it was at $3.71. Today it is at $6.59 after reaching $8.28. Essentially doubled in price. Now that oil prices are falling, the company hopefully will become cheap again.
| quote: | Originally posted by Krypton
From August 26, 2007
Vaalco has fallen 19% below the price I paid for it. I might have to sell it if it reaches 20%. Besides that fact, Vaalco remains a very good company. They have 72 million dollars in cash ready to be spent on ventures, operations, exploration, etc. The sell-off that has occured is PANIC SELLING!! I'm listening to the conference call right now, and my anxiety has been alleviated. This company has so many prospects for profit, it's ridiculous. They just signed a deal in the UK North Sea, and are quickly developing the Angola and Gabon rigs. They are also opening a new office in Rwanda. Besides the fact these countries have just come out of a civil war, I'm betting these countries have found some stability, enough to do business. I'm very confident that by the end of 2008, EGY will break out. This view is also shares by Vaalco Management. They have said in their conference call that 2008 will be the breakout year for Vaalco, and so be patient. The sell-off in stock is not warranted to the true value of this company. Their balance sheet is solid.
Stock buybacks - The stock is cheap! But the management only said they would consider it.
If any of you are looking for more risky plays in the international arena, Vaalco (EGY) is a sure bet, a more safer bet (balance sheet). The stock is cheaper than ever. Buy this Lexus for the price of a junker. |
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| mndeg |
haha. i'm glad that I'm long. thank god I figured out the market was being manipulated or else I would very likely be short because of fundamentals and trying to fade the market and whatnot. same thing happened yesterday, markets heading down always drifting lower and lower and lower, than huge buy programs, drifting lower, buy program, ALL the way into close.
| quote: | | Turkcell is up 15% today after buying an 80% stake in Belarus's state-owned mobile operator BeST. I don't call bottoms, but I did call when this stock was under valued. |
... it really depends on the market. oil went up 4.5% today last time I checked. in fact the stock could of been a terrible company like GM, or any homebuilder and went up 7+% |
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| Krypton |
| quote: | Originally posted by mndeg
... it really depends on the market. oil went up 4.5% today last time I checked. in fact the stock could of been a terrible company like GM, or any homebuilder and went up 7+% |
TKC blows GM and any home builder out of the water! They actually have a competent management (not that most home builders don't)..;) Fundamentals/management are 100x better than GM. GM has low PE because it deserves it. TKC has a low PE because....I don't know! It shouldn't have a low PE..;) |
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| mndeg |
| i don't think anybody is looking at PE right now. many financials now have negative P/E and negative P/E projected forward but are still going up. think of a terrible company and check how they performed today. tomorrow will likely be a huge up day again breaking old resistance, we actually have an excuse to rally tomorrow visa and disney beat expectations. |
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| Krypton |
| quote: | Originally posted by mndeg
i don't think anybody is looking at PE right now. many financials now have negative P/E and negative P/E projected forward but are still going up. think of a terrible company and check how they performed today. |
I think day traders are the ones adding such high volatility to such bad companies. They pay little to no attention to PE.
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I'm finding the Information Technology Sector very good. Whether this indicates anything, I can't say. But I'm betting on a new technology boom. The dot-com bust is long gone. |
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| mndeg |
the problem is stocks have no intrinsic value and extrinsic value is merely assigned to it in a type of symbolism. if a company defaults who gets their money back? the debtors do, the preferred stock holders do. who gets nothing? common stock owners.
stocks are a zero sum game, if someone gains 10,000 another person lost 10,000 or someone bought in a a premium (a top). it's all about passing the bag onto the next bag holder under the guise of fundamentals/technicals. |
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| Shakka |
| quote: | Originally posted by Krypton
From what I understand, it's shorting stocks that haven't even been borrowed. And it's currently illegal for a short list of I think 19 financial stocks. |
Partly correct.
You are correct that naked shorting is shorting shares that have not been borrowed. This practice is and always has been illegal with one exception: Market makers (the guys who facilitate the orderly trading of shares on the floor) are allowed to go short as they have to buy and sell shares all day long to maintain an orderly market. As long as they cover any short positions they create in making a market, all is fine. This law has been in place since the 1930s.
The new rules instituted by Chris Coxsucker have not made it illegal to short the "sacred 19" financial stocks on the list, however it has made it a bit more of a logistical pain in the ass to do so. Typically in order to short a stock you must call your stock loan department to ensure that there is enough of a particular stock to borrow so that you can short it. This is called getting a locate (i.e. there simply needs to be reasonable belief that shares sold will be delivered on settlement day which is 3 days subsequent to the trade). On the "sacred, don't touch 'em cuz they have access to the Fed window 19" list, you have to get a "Pre-borrow" which is a firm borrow. For example, to short those stocks I have to get my stock loan department to get a firm locate on those shares and guarantee specific shares will be delivered on settlement. Really it's just a bit more red-tape and operational bull. The stocks are still borrowable though--I just shorted a bunch of FRE on Monday (too bad for me!).
There is nothing illegal or bad about shorting stock, provided it is done in the proper way. In my opinion, it is obviously bad and stupid to try to spread false rumors to try to drive a stock down, but it is equally bad when longs spread false rumors to try to drive a stock up (and get a short squeeze to ensue at the same time). In a "free" market, any and all investors should have the ability to bet both for and against a stock, placing their bets based on their own work. There is nothing "un-american" or criminal about doing this--it is just giving people the freedom to bet on an outcome. It's funny how everyone loves to villanize the shorts, yet it is they who more often than not uncover serious problems (i.e. Enron, WorldCom, many of the mortgage/housing issues, etc.).
To my knowledge, I have never seen a convicted "Naked Short" brought out in public. He is a bogeyman that nobody has caught but that the SEC and others want you to believe is the cause of so much stock market decline. Longs outnumber shorts in the market by such a huge margin that it's silly.
Instead of constantly repeating the mantra that naked shorts caused Bear Stearns to fail and are responsible for their stocks' declines, why hasn't' the SEC investigated the clearly false and misleading statements that Alan Schwartz, John Thain, Erin Callan and others have made? Why don't they address how their companies got into such a position of needing a bailout?? It's not because they were shorted, it is because they levered up with highly illiquid, overvalued, worthless assets that the shorts warned about for YEARS. Yet in the end it's the shorts that get blamed and the CEOs walk away with millions. Talk about irony.
I have recommended it before and I"ll recommend it again--"Fooling Some of the People All of the Time" by David Einhorn is a fantastic read. |
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| mndeg |
it's because the government is supporting Thain and his lying. Don't see why they would persecute the people they are trying to help. Paulson himself is ex-Goldman Sachs. Watch for the Paulson pump tomorrow at 12:00, better not have any short positions. Seriously, the guy scares me when I have puts.
There's something wrong when number of shares shorted is greater than open interest. It's just fundamentally wrong, but the IB lobbyists actually got the gov to not persecute them for it. crazy.
However on the pro naked short rule, it's a pain in the ass to have to call a broker just to get him to locate some shares to short. |
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| Krypton |
Man, have I been clobbered the last 6 weeks. TKC definately brightened my day. I shot up from the $11.50's to now almost $11.98..heheh:D
Both of my main funds are ranked in the top 3% and 7% respectively on the entire marketocracy site. I just need to bring my turnover rate way down. |
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| atbell |
Turn over rate? Does this mean you're to active.
I think everyone's been hit. I'm calling for another huge bust mid-august though. Houses aren't selling, banks are all in crap, the investors are comming back from holidays, and even the "prime" mortgages are starting to break.
And don't even start on credit card debt.
Right now I think the best investment is in concrete assests. A printing press, a lathe, a hammer, ... things that you can use to make other things. The demand is still there it's just that the public companies are in the crapper.
Maybe some venture capitalisim, find someone else with a printing press, a lathe, or a hammer and help them expand. |
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