Tuesday, April 1, 2008

Spring is Here

I saw a few blossomed crocuses that are always the first sign of Spring here. Finally. They are a few weeks late as the overnight cold temperatures here were consistently about 20F for all March. Good news indeed, a change of weather will be quite welcome as the winter was very long and very cold this year.

A change in the markets would be welcome, too.

Here are the year to date results for my funds:

Krypto Fund: -3.03% ytd, a bit better than the results as of February 29, and hugely superior to the stock markets as a whole. This is the benefit of the massive asset class diversification investment policy of the Krypto Fund and the active rebalancing used. The prior large gold & silver holdings were sold near the highs in March as directed by the re-balancing policy. So this performance is really remarkable and proves the entire strategic investment policy of this fund works under times of great stress.

Alpha Fund: -14.4% ytd, again a bit better than the results as of February 29. This fund is very aggresive and now is 150% long after the partial sales of BAC, JPM and GE on rips. I had doubled down on those in a washout and so got a much lower average price. Hence my current holdings are properly sized to long-term investment and show nice profits. Big losses still extant are in C and WB and a small loss in GOOG.

I started making a few trades in the Alpha Fund after about a year's cessation to get myself over the psychology of wanting action. I'm using options to preserve capital and keep the activities from affecting my stock positions. Don't do this unless you understand options, including the approximate "delta" of the position and how the delta and the option value will change with the underlying stock price. I normally use in-the-money calls with a few months to go to expiration. I size the position based on the total value of the stock optioned, not the actual cash value of the options purchased. This keeps me from buying and risking too much money on these very risky securities. I've been trading options for over 25 years and understand the risks quite well.

So I averaged into a few LEH July calls yesterday. I think the bears are wrong and way too short this fine company. LEH sold $3 billion in a convertible preferred after the close and the issue was greatly oversubscribed. So this should settle the matter of the survival of LEH. I bought the calls when LEH stock was about 90% of book value. In my experience this is a very low price for a quality firm like LEH. Obviously this is a risky speculation. Now the waiting.

Word of the Day

"Chignon" - noun [$10] pronounced shen - yen' with both e's short as "set"
Chignon means a roll or knot of hair worn at the back of the head or nape of the neck.
Sentence: The mask of Sargon the Great of Akkadia [c. 2300 BC] shows that he worn his hair with a chignon.

"Anchorite" - noun [$10]
Anchorite means 1. a hermit; a religious recluse; 2. a person of secluded habits.
Sentence: There is no doubt that Bunkerman is a 21st century anchorite living in his well-defended and well-stocked survival abode. [joke]
Compare to "Coenobite" [US "cenobite"], being a member of a monastic community.

57 comments:

Bunkerman said...

hmmm ... I suppose LEH was smart enough not to sell the convertible preferred to hedge funds who would short the common against it.

mfl59 said...

this news on LEH will hurt the bear case for sure bunkerman....good one sir

Spin-em said...

thanks for posting results Bunk....youve set yourself up for the stretch run


I cant believe the Phils still have Tom Gordon as their closer ..the Phils are in trouble with that pitching staff......

Bud said...

uh.......i like the phillies alot this year

they can get a closer around all star break

Spin-em said...

uh...there's 80 games til the all star sir...If history is our guide...the phils get 10 games behind early and cant make up the ground...smarten up Bud

Bud said...

"hank and ben to their wall street buddies..........keep gambling.....we'll bail you out"

Bud said...

does the staff of the independent newspaper in london read this blog?? front page story today...."the great depression of 2008"

http://www.independent.co.uk/news/world/americas/usa-2008-the-great-depression-803095.html

Bud said...

i like the cubs to win nl-central this year

kerry wood......pffffffffffft

mfl59 said...

Adds Martin J. Whitman, founder and co-chief investment officer of Third Avenue Management: "In my 58 years in the market, it's never been easier to conduct bear raids." His funds sustained losses when shares of companies such as CIT Group and bond-insurance companies, such as MBIA and Ambac Financial Group, fell significantly, declines he blames on short-sellers.

Bunkerman said...

Cettainly, Bud, this blog has proven to be an leader in facts, events and analysis ;-)

Bunkerman said...

The Democrats in Congress must read this blog, too. I wrote populist ideas about helping the homeowners in trouble & underwater late last year that they are copying now.

[to write down loan to % of appraised value and use FHA to take the old lenders out]

Frosty said...

Bunkerman...LEH I assume you knew something, your good, but...amazaing timing sir...Bud must be raw and I don't mean from the biker bar pole.

Bunkerman said...

I just understood the findies on it, and the beefers and knew management was quality and not crooks ... like a certain other firm. I wanted to take advantage of a dip on that Japanese fraud news which I suppose was the reason the shorts were hitting it last week.

It helps to have lived through the 1981-1982 fin troubles.

Frosty said...

the findies indeed... code for inside dope, got it.

Bunkerman said...

lol a typo ;-)

Going sheep herding in a few minutes. Back about 3PM.

Frosty said...

Philly...don't think so...that ryan howard is a fat pig...best bet he breaks down, philly maybe 62-100.

mfl59 said...

wrong way beefers caught flat footed in the metals and commodities again....what say you Bud?

Frosty said...

Dear Sal

elton can suck the chrome off a trailer hitch....don't miss out, join us.

Bud said...

wrong way beefers.......one of the silliest things i've heard of........up there with frosty's 'ops expo'

ridiculous

Bud said...

i sent Hillary 100bux yday........still have not got a thank you email


upto 1450 i think now

Bud said...

i'd love to go that concert

elton is good

and my dream in life is to meet hillary and chelsea

mfl59 said...

sir it seems a certain reverend has you brainwashed.....what a pity...

Bud said...

wow frosty

elton gay jokes

sure hope you didn't spend alot of time workin on that one

frosty really is a pig

Frosty said...

uh Bud...while your were looking for the ball in the corner I headed home...inside the park.

Frosty said...

W out of the country and we rally hard...oh the days when we would dip, a true buy buy buy...no longer worried about the sniper...sad day indeed.

Bud said...

how long frosty goona use a sniper joke

it was mildly amusing the first time

now it's just unfunny and downright stupid

Frosty said...

wow...jumping on the spilter, way out in fornt...fresh material always puts you into hiding...just like your deadhead tampa freind...bring the heat?

mern said...

zzzzzzzzzzzzzzzzzzzzzz

life sux

Spin-em said...

Bud..who wins the mern smoke out?...You make the call

BCN8R on the line

mern said...

phillies sign another 40 yr relief pitcher.

y not just have kept myers as the closer and signed santana instead of the stupid mets?

interested to see how reid blows up his 11 draft picks. lets see, trade #19 and shepard to move up and take the best WR available, who becomes the next freddie mitchell?

andy sux

phillies sux

Bud said...

i think Ben Bernanke wins the mern smoke-out award for life

ever since he engineered BSC takeout at 2 bux

mern been .......uh.....'livin on the edge'


"i'm with satan ! "

Spin-em said...

Michelle guns starting to rival Claman..loool

Bud said...

splitter....slider....changeup...heat......frosty got all his pitches workin today

that's ok......early in the week

i bring out the lousville slugger tomorrow


lmaoooooooooooooooooo

Frosty said...

Philly still a great place to catch nine...two tix in one...ultimate fighting, bleacher version and a diamond side show.

Frosty said...

an all star pitcher than can handle a stick is special indeed.

Spin-em said...

merns fine...(Dont make me "whip out" my neck tumor story...it has drama,fear,and an inspirational uplifting appreciation of life theme)...LMAOOOOOOOOOOOOO

Frosty said...

Bunkerman...month end mark down indeed sir and back it up with LEH calls...you should start a paid service, some pay $500 a month for very little real analysis...at $1,000 a month the bunker view is a bargain.

Bud said...

did they reinstate the uptick rule??

mern said...

i was informed yesterday i full blown skin cancer.

i love life, NOT!

Bunkerman said...

Hmmm I see the sheep herding worked for push Mr. Market up.

mfl59 said...

jimmie begging people to contact the SEC to bring back the uptick rule..yes, sir, thats why your picks are a bit subpar....

he must read this blog...

Bunkerman said...

I was thinking of sending the SEC a letter myself about that.

Bud said...

'letter to the SEC'


lmaooooooooooooooooooooooooooooo

Bud said...

can you ask the SEC to do somethin about this '1920s type manipulation' as well?

Bunkerman said...

Sure will, Bud. That will be part of my uptick rule complaint.

Bunkerman said...

flipped 1/3 of LEH calls. Averaging out.

Bud said...

'averaging out'

Bman with the nasty slider..........unhittable

i better take a seat on the bench


loooooooooooooooooool

Frosty said...

Bunkerman...touch them all...bank...Bud's trip to the majors short lived...enjoy your coffee on the bus son, just clear your locker.

Frosty said...

JINX

Bud said...

does maria b read this blog? she just said "lehman rumor mongerers"

Bunkerman said...

lots of charts putting in higher lows and higher hihgs.

Bunkerman said...

well, Bud, surely anyone wanting the true picture reads this blog ;-)

Bunkerman said...

out of the LEH calls. I think I would anger the trading gods if I hold, showing greed.

Hmmm ... there's a $10 word for these thoughts ? Can't remember it. It was a word of the day recently. Darn.

Bunkerman said...

got it ... March 10 ... polydaemonism meaning a belief in evil spirits.

Spin-em said...

fantastic job Bman....rev would be soooo proud of you.loooooool

Spin-em said...

MOOOOOOOOOOOOOOOOOOOOOOOOO

Bunkerman said...

S&P higher low and higher high, too.

GE chart looks like a small cap ripper.

Hmmm whither armageddon ?

Seems not coming hither ;-)

maybe thither tormenting the beefer bears ;-)