Saturday, August 28, 2010

The WTC and Mosques

George Bush andmany others have told us that terrorists hate us because of our
freedoms. Well, what better way to show our dedication to freedom of
religion than building a mosque at the WTC. Christians, it's the
ultimate example of "turning the other cheek," so I'd expect you guys
to be on board with this as well.

End of discussion.

Where's Matt Lydon During All This?


He's in a season 7 episode of Bullshit! with Penn & Teller.


Thursday, August 26, 2010

The Data Whisperer


He can talk to data.


here's some starting "evidence" for Kevin.

ARQL triggered an Engulfing Line followed up by heavy volume on 8/26 & 27.

COCO had a good Value Score but some bad news in the past, and triggered an Inverted Hammer on 8/24, was followed up by and Engulfing Line and heavy volume on 8/25.

YCS was recommended by a podcast investor I listen to which has some decent fundamental and technical potential at the moment, and not the result of a triggered event.

HOGS had a tremendous Value Score (for some reason I called it "Value Metric PE"), about 2.5x the average score, a triple-moving-average crossover, a good MACD entry and an ever-climbing Commodity Channel Index.

HMSY had nothing going for it but I had made money off it in the past. It was at a lowpoint and I bought it, and then it sank a bit below resistance and I sold it for a 2% loss. 

So if you had invested $10,000 in these 5 stocks 2-3 days ago you would have made somewhere between $300-$500, which beat the Dow Jones' $100 by a good margin.

I know, you could say, "this certainly proves nothing and could be dumb luck," but at least its something tangible that I can get my head around. If you want me to explain the relevancy of any of the measurements I use, feel free to ask.

Wednesday, August 25, 2010

A glaringly obvious investment analogy...

Larry Hopeful was convinced he could make money betting on horse races. He had been compiling data and research on them for years. He knew that a horse was slightly more likely to win if Doug Handy had dressed its horseshoes. Jockeys in silk uniforms achieved slightly less wind resistance. If three brown horses won in a row, then it was statistically unlikely for a black horse to win in the next race. Random statistical knowledge of the last sort bothered Larry. Gay jockey's can only win on prime numbered days of the month. 'What could that possibly mean,' pondered Larry. It seemed like every gay jockey would lose money for Larry, even if it was a prime numbered day of the month.

After years of practice, Larry was able to boost his average chance-to-win-a-race to 50.3% Obviously the time and effort put into this endeavour was mostly wasted. Larry decided that, even though he enjoyed the process, he couldn't justify risking his hard earned cash. He continued to go to the races, but he would just watch. One day, as he wandered through the stalls behind the track, he noticed that all the horses except one were sick. Better yet, some of the horses had been withdrawn by the Federal Horse Commission due to legality issues. Even better, the one healthy, legal horse was slated to run on the dry side of the track. What an opportunity! Larry quickly rushed to the box office and put $1000 on the golden horse. The clerk informed Larry that, for a small fee, he could insure his bet against loses, so that there was now only an upside to the bet (minus the fee).

Larry won big that day. But for years after that he just hung around, compiling data until he could find that 'sure thing'. All that waiting might have been more boring than reckless betting, but at least now he had enough money to buy that sweet new analog-digital hybrid polysynth.

Tuesday, August 24, 2010

The Big Stock Post

Been telling M. Lydon I was going to do this for a while, and I'm finally doing it.

My plan was to come up with a quick scoring "algorithm" for the fundamental basis of stock value & potential, using 10 commonly-looked at financial variables/metrics that are supposedly correlated with the measurement of a company's "success." (by "success" I mean "stock price increase"). There are many, many more variables that professionals use to analyze the worth and value of a stock, but some analysts use only price charts to decide when to buy and sell stocks.

100 Stock Analysis - stocks from Dow Jones Industrial Average, S&P500, Fortune500.

I wanted to make an average "value score" of established, big stocks so I could compare future stocks I wanted to analyze to it, in search of promising companies with potential. I wanted the average score for 100 certifiably good companies to be "100" for convenience, but it fluctuates with the overall market. Here's the list of the 10 components to generate the score ("Value Metric PE", column AA), in order of their weighted importance:

EPS Change (year over year)
EPS Rank (Investors Business Daily)
Estimated Annual Growth
Profit Margin
Sales Per Share
Ideal Growth to P/E Ratio
Ideal Price to Sales Ratio
Insider Ownership
Quick Ratio
Price Ratio to 52-Week High

As I've also recently been working on the charting part of it, I've been trying to implement a combo of what's considered "fundamental" and "technical" analysis -- buying solid stocks at critical moments in time (e.g., at the beginning of an uptrend after a recent downtrend). 
Technical Event Name (worksheet link)

ave. 10-day gain ave. beat 10-day market
Engulfing Line (Bullish) Average
1.93%
1.25%
Exhaustion Bar (Bullish) Average
4.45%
7.42%
Gravestone (Bullish) Average
0.72%
-1.99%
Hammer Average
1.60%
0.09%
Inside Bar (Bullish) Average
-0.27%
-0.61%
Inverted Hammer Average
-0.74%
-1.79%
Island Bottom Average
-3.06%
-2.81%
Outside Bar (Bullish) Average
2.56%
0.84%
Two Bar Reversal (Bullish) Average
-0.68%
-1.23%
Grand Average
0.99%
0.07%

Some "Technical Events" are better than others, but they don't necessarily mean anything without "confirmational" signals, such as increases in trading volume, momentum and other measurements of interest in the stock.

But what I've come to learn is, some days all of that preparation doesn't mean jack shit. The market's just gonna do what its gonna do, the bears are going to rip through town and take everybody down with them. I don't know how almost all stocks could be interconnected but they pretty much are and from what I hear this is more of a recent phenomenon... The only way to avoid dependency on the market is by buying low Beta stocks (low market correlation), but that doesn't necessarily mean that they are going to be a good stock.

Then there's the shorts, the people who get a whiff of fear and cause major price drops by selling institutional shares on loan in hopes they will go down further in the future (assholes). Then there's the old billionaire or millions of other aging investors who have decided they've had enough and are cashing all their shit out at the same time.. It looks like it might be a good time in history to learn the art of short-selling, but knowing my luck shit will reverse course right after I start doing that...

So, every weeknight I have a list of stocks emailed to me that happened to trigger a Technical Event during the day. I look through them, first looking at their current trends (I'm only buying shit in longterm uptrends right now), what happened to the stock that day, and then I generate value scores for the more promising-looking ones, sticking the higher-scorers in a Google portfolio so I can track them. Then when the market opens the next day (3:30 am here), I watch their initial progress, and the overall progress of the market to make sure its not gonna have a decidedly shit day today. If things look decent, I buy the stock from the Google portfolio list that has accelerated the most so far that day.

Then, when my shits fall anywhere from 5-30%, I sell them and buy new ones... And that's how you get reamed in the stock market!!

No, but really.

I've actually only been implementing this entire strategy for a week or so now. I have a rigorous set of guidelines laid out, and its tempting to not follow them or cut corners, but I am gaining disciprine and we'll see what happens from here on out.

If you made it this far and am interested in what I currently have:

ArQule, Inc (ARQL)*
Corinthian Colleges, Inc. (COCO)*
Zhongpin Inc. (HOGS)
HMS Holdings Corp. (HMSY)
ProShares UltraShort Yen (YCS)*

I also wanted to buy the Chinese stock Harbin Electric, Inc., but TradeKing won't let me put the order through without calling them. Its for your own protection, they say.. Maybe its because about 25% of this company's stock is held by short-sellers, which is remarkably high, meaning people think the demand for electric goods in China is gonna tank or something.

Matt Lydon? Are my value metric weights scored copasetically?

What do you hold right now, out of curiosity?


*bought 8/25

Matthew Q. Lydon is up to his old tricks.

He went and "got knives" again...

Monday, August 23, 2010

HotBits

Fresh randomness, served up hot and piled high: HotBits.

Sunday, August 22, 2010

Cleansmanship linked to loss of life, mass devastation


Monthly Cleansmanship Posts vs. U.S. Tornado Deaths



The numbers don't lie. We are obviously causing people to be killed simply by posting on this blog. Somebody probably just got sucked up into a whirlwind right now because of this very post. Not only is graphing data fun, but graphs can be your best friends and senseis.

Next report: how I single-handedly caused 9-11 through a chain of events sparked by poor decisionmaking on my part back in mid-2000.

Why is the world so weird?

whispered Wilfred, as he whipped out his willy and whizzed on the wheat wagon.

Monday, August 16, 2010

The Church of the One Reality

Deep down, in the core of your soul, do you feel like you are living your life in a singular reality? Regardless of the possibility of multiverses, we have all managed to co-exist in the same reality for as long as we can possibly remember... There was never any time when you said, "hey dude remember the time Josh disappeared into the multiverse for a while and came back? That was weird."

We are following a most linear path through time which is guided by inflexible, unchanging rules, laws, formulas, etc., and even if we do not know exactly what the formulas are that govern what is happening in our reality at any particular moment, we accept that an absolute truth behind these laws and formulas does indeed exist... for if we did not, we would have no basic principles of knowledge on which to build upon and we wouldn't be able to figure out anything technically advanced at all.


Ergo, at any given time in this universe, there is only 1 reality, only 1 way in which a particular set of events can unfold due to the steadfast and dilligent application of the unbending rules of physics, chemistry, mathematics and astronomy. We can have different interpretations of the same event but when one begins to abandon science, logic and reason in the face of emotion, ego or stoicism, they are indeed abandoning the one reality and not in fact creating a new, equally valid second reality. These realities do not now coexist because only 1 of the realities ever existed in the first place.

So indeed the world is now full of "ghost realities" which only serve to confuse and madden those who happen to cross the paths of their vessels. On the other side, those who have respect for science, logic and education, and are willing to admit when they are wrong and correct themselves in order to perpetuate ideas more closely in alignment with reality are doing a service for humanity by helping to spread true understanding. It is indeed true understanding because it can be used to successfully better oneself by applying it to our 1 reality, of which, of course, there is only 1.


Thursday, August 12, 2010

Perfect World: How would you play it?

So, as with poker and many other risks in life, I play my stocks kind of recklessly. I'm about to cut that shit out thought cause its not working and losing me money, just kind of fulfilling an addiction to easy reward-seeking behavior.

But one such stock I still hold is Perfect World, which is pretty much a Chinese rip-off of Warcraft. Their shit is even more simplistic yet almost entirely the same, even though they claim it is based in Chinese mythology.

I was attracted to them because their stock was kind of cheap, they have rather solid "fundamentals" and I heard about how they were expanding in Malaysia and Indonesia, which is over a billion people big. So maybe the dumb-downedness of the game makes it a bit more universally playable, so I was thinking...

Maybe it would be the catalyst that transformed Indonesia into a non-Muslim country, once they realize the benefits of Westernization by riding their level 70 Psychic into glorious battle on a panda...

Heres an excerpt from some humorous reviews I read about them, from Game Ogre:

"fantastic game!! but so many scammer hacker livin here..
but GM's dont have take any action..
also have many blackmarket and duplicator..
i only wasting my money for this game when other make duplicates item.."

The reviews seem to get worse over time, a lotta interesting stuff about how the buy-packs cause a lotta inflation in the game...

They release their earnings next week, and are currently up 7 cents (0.23%) on a day when the market's still below 0, but I've come to learn that doesnt necessarily mean anything at all..

So, do you think they will report bigger numbers or smaller (increasing growth versus decreasing)? I personally dunno, thats why I've been losing money. Its Indonesia vs. the long-time users, we'll see who wins out...

Tuesday, August 10, 2010

Friday, August 06, 2010

Sunday, August 01, 2010

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