Wednesday, August 03, 2005

Copper and Poker

As a college kid trying to make a few extra bucks to pay for my weekend activities, I used to play poker a lot. A fun game - those days I gambled money like I actually had it to lose, but luckily I won more often than I lost, unless I was quietly letting a friend win whose money I did not want to take. Everyone has heard the saying "if you don't know who the sucker is then it's you".

Well I will spend the night wondering. I happened to see on CNBC a story about copper hitting a new high at $1.73. On my decliner screen, I happened to notice PCU down over $2. Call me a simpleton, but that doesn't make sense to me at all, especially with no news or releases on PCU. A little digging revealed that 8/3 is the dividend date, despite my online trading firm's mediocre research pages, I was able to determine that the dividend goes to today's seller, not me as today's buyer. That makes the drop make some more sense, but what doesn't is the stock going down almost double the $1.04 dividend on a day where copper breaks through to a new high. So I bought in. I will now spend the night wondering "can it really be this simple?"

Well, either it is, or I am going to be the mark sitting at the table with a few Hedge Fund managers and the specialist tomorrow.

Today's recap:

Listened to the archived conference calls of half a dozen riggers today (work was slow). Bought Global Industries - they report tomorrow. Global's earnings are tied to day rates for their jackup rigs - in the May call they suggested that they might re-activate some idle rigs if rates went up substantially. Based on the recent calls, it sounds like day rates are up 50% or more. If management did what they should do, they've re-activated and contracted those rigs and will tell us that tomorrow. The stock was up on RIG's numbers, but that doesn't seem like enough to capture the big increase in day rates. We'll see if my call was right.

Completed a solid trade in CUTR this morning. Should be happy but I'm not - this thing continued to skyrocket after my exit. A winner is a winner, though - nothing to complain about. Does this sound convincing?????

Exit YHOO at $34.58 for a nice and relatively low risk gain also.

Have to research my tapes - my brokerage is telling me I own 600 shares of MFE that I don't. Need to get my ducks in a row for the phone call tomorrow morning.


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