The Proficient Investor

Purchased several call options on Dow Jones. Bought the June 15th Calls, strike of $65/share.
I think several bidders will step up, if it happens next week, those calls will be heavily in the money in my view. Already own the shares at $60.99/share.

Stocks ended the session down hard this afternoon, the Dow lost 200 points, while the S&P and Nasdaq all fell hard as well. Yields on the 10 year note rose above 5% sparking many fears about the market.
Tomorrow I think we fall early only to rebound from the lows. Overnight, many foreign markets will sell-off as well. I mentioned earlier that its wise to play these corrections with qid and sds. Those positions are finally moving in the right direction for me.
Note on Apple (aapl). That stock is getting way overpriced, the iPhone may not be as good as people are saying. Not taking a short position as of yet, but looking closely at this one.

So far this week the markets have had a tough time, today all three major averages are lower, with the Dow leading the way. Tech shares seem to be holding up a little bit better than financials. I’ve been a big buying of Proshares Ultra Short NASDAQ and S&P 500, the symbols for those are QID and SDS. I think taking a position in these names is a good way to play a possible further slide. If the market comes back and rallies I would sell part of those short funds. I’ve held onto QID and SDS and now have a long-term position strategy on those names, as I am a overall bear. Hedging a overall bullish portfolio is a wise move, especially in a day and age when volatility can rear its head quickly.

We pay for energy at the pump, and this summer odds are we will be paying some very high prices. The energy markets are so complex, one can only dream about their complexity. I myself am no expert, but I can tell you with the hurricane season here, and news of major storms building up all over the globe, this summer could be one for the ages.
I have been a big bull when it comes to oil and energy markets. I think oil will at some point will enter unchartered territory. Natural gas and reformulated gasoline will rise to very high levels, leading many US consumers to feel the pinch. I expect Natural Gas to trade well above $10 this year, as supply undermine demand.
There are many ways to play the potentially hot summer in the energy complex, but for normal investors it may be wise to pick up some US Oil Fund (uso), or Exxon Mobil (xom) as a way to play higher oil prices. There are other exotic trades, but for the most part those are for more seasoned traders. An example would be the United States Natural Gas Fund (ung). This recent ETF based security is tied to the actual futures gas contract, like the USO it can be very volatile and trade at a premium.
As far as crude goes, we are setting up nicely for a run at the highs we saw last year, then potentially set for breakout above those highs. Currently trading at $66/barrel crude is well positioned to take advantage of the hurricane season as well as overall geo-political hostility.

Purchased a couple securities this week, all trades were conducted on Friday.
Bought more IMAX Corp (imax) @ $4.54. The stock has sold off from the mid 5’s in the past month. Believe the stock will get a lift in the coming weeks as the company gets their financial books in order. Already own IMAX in several other accounts.

Bought shares of Dow Jones & Company (dj) @ $60.99. The shares are rising 15% today after the Bancroft family announced that they will consider a sale of the company. Family also announced that they will talk to News Corp about their offer. I think Murdoch will raise the offer well above $70/share.

Markets were higher this morning, then dropped mid-day. The NASDAQ has held strong throughout the day. A string of deals has helped keep the market up. Oil is trading lower today, the entire energy complex is down as well. However, we have seen the market correct mid-day once again. Lately the markets have not been able to keep strong gains throughout the day. This may mean the markets are getting tired.

We have seen this type of activity for the past week or so, this activity has me thinking that we may be close to the end of this bull move to the upside. I think we correct, but the big correction is not here as of yet. In my view, it will be a event-driven event that takes us down hard. For the better part of a year, I have been very cautious and downright bearish on the markets, even though the markets have been on fire since then.
Although I think we are a quarter or so away from a very large, sudden and swift crash, it appears that right now the markets may try to meander from these levels in the short-term. I am overly hedged some would say, but still profiting that of the overall market.

Sold my Build A Bear Workshop position @ $30.76, profit of 7.15%
Still own call options on the security.
Added to my Ultra-Short NASDAQ position (qid) @ $46.82

I think the market will go into profit taking mode in the near future.

Shares of Amazon (amzn) continue to rise in the face of more and more pessimistic views climbing on the company. Amazon got it right last quarter, something which surprised (short amzn) me and most on Wall Street. The shares today are 4% on what appears to be a technical break-out of their recent short-term trading range.
Insiders have been selling the shares recently in the face of a more than 40% stock advance in just a couple months. Shorts have had to cover their losses which is one of the main reasons why you are seeing such buying here at these levels. At some point the stock will come back down to earth. The company in my view has priced itself for perfection, and anything shy of that will crater the stock back, the shorts will rush to this stock.

Shares of memory drive maker STEC (stec) are down sharply today amid a uncertain and rocky quarter. STEC lost about a quarter of its value after the earnings announcement and weaker than expected guidance going forward.

The lowered guidance was pinned mostly to the uncertain pricing climate and a sudden fundamental cautious stance for their largest business segment. Two Wall St. firms downgraded the company which contributed to its shares seeing a large sell-off throughout the course of the trading day.

For the quarter, STEC made .13/share for the just reported period on sales of $47.2 million, up roughly $7 million from the year ago levels. However excluding certain numbers, the company made .05/share. Last quarter the company sold its consumer business unit which it booked in this just reported quarter.

Guidance was a horror as Wall St. expected the maker of computer memory to post a profit of .09/share against the reported guidance of .01-.03/share. Sales were expected to be in the range of $48.8-49 million. Company now expects revenues to be in the range of $41-43 million.

STEC, formerly known as Simpletech Solutions was a huge winner in 2006. I personally did very well investing in the stock the second half of 2006 (sold in early 07). Now the company looks like it is going through a fundamental soft period. I would not advise buying this stock until its fundamentals improve.

Shares of STEC closed @ $6.10/share.

Overall markets are somewhat negative today. The broader market is losing steam as the trading day goes on. The S&P 500 and NASDAQ are among the index losers. The Dow remains stronger about unchanged for the day so far.
Last week was interesting as we witnessed a 150 point sell off in the Dow and a mirror image percentage wise for the overall broader market. Then on Friday we bounced off and rallied over 80 points. So where does the market stand and what are traders talking about today?

In my view, the traders are talking about lower growth and inflation worries. With a down market today this may translate into more profit taking this week. There does not appear to be a big emphasis to buy right here at this moment. But investors have continued to buy stock in this type of environment.
I am a bear so naturally I am inclined to see negative trends developing in the markets. If the markets change course look for heavy selling on stronger than normal volume.