Portfolio Update: Added to an Existing Position

On Monday, August 12th, I added to my existing position of T. My reason for that was because I believe the price to be in the right range for a purchase. Here is how I came to that conclusion.

Fundamentally T is a top rated telecom with high growth, EPS, and revenue with the expectation of continued growth in the coming years. In addition, it has a very attractive yield that, at the time of this post, was above 5%.

The stock has pulled back more than 10% from its 52-week high of 39 USD made on April 23rd. The stock has also created two short term tops on June 13th and July 17th, putting a resistance just below 36.50 USD. At the same time the stocks price has approached and seems to be bouncing away from the upward trend line I charted for it from January 18th through June 21st. As far as other technical indicators, the daily and weekly stochastic and MACD indicators (which are trailing and confirmation indicators) both show that the stock is becoming oversold. Instead of waiting for confirmation, I chose to pull the trigger now for what I think is the lowest price I will possibly get this time around.

Not having a lot of excess cash available I purchased all that I could. It is my belief that this should turn out to be one of my better timed purchases. If not, I still plan on buying more if more funds become available and T remains in this setup. That's my opinion. What's yours? Disclaimer: See bottom of page. http://investorsopinion.blogspot.com

EPS - earnings per share
MACD - moving average convergence divergence
T - AT&T Inc
USD - United States Dollar

Portfolio Update: Still Need To Work On Patience

As I am writing this I am dealing with a little bit of sellers remorse. A little over a month ago I wrote that I was comfortable with holding on to a call option I bought against Capital Product Partners, LLP (CPLP). In the week that just past, I was becoming exceedingly uncomfortable with my decision. As a result of the discomfort I progressively lowered my limit price to sell the option. In my mind I was attempting to capture as much of my remaining principle as I could. Anyway, today the sale of the call option finally triggered, but at a price less than 50% of the initial principle. The net result was a loss of a fraction over 60% ($91.21). What followed after the sale was that the option price continued to rise to a point at which I could have reduced my loss to about 45%. As I analyze the charts, I am seeing that I should be happy with what I was able to keep. However, I won't know for sure until September 17th.

In other news, I successfully sold a July2010 $19 Call option against my shares of the iShares Silver Trust ETF (SLV). My usual difficulty with selling against my shares is that in order for me to make money off of every share I have to sell an option at the next highest strike price from my most expensive share. I see this as a problem since SLV has a swing difference of up to $5, a 52-week high of $19.44 and I have 20 shares that were purchased above $18. This doesn't give me much room. I am actually looking forward to getting called out of my position of SLV so that I can cash in on my capital gains finally.

That is my opinion, you can take it or leave it. Disclaimer: See bottom of page. http://investorsopinion.blogspot.com

Personal Stock Pick

I am making a personal stock pick for Monday. It will be for 10 shares of EVEP. This is one of the stocks in the energy sector that I have been watching. It is actually considered fundamentally unworthy because of it's highe EPS and low PE. However, it has a track record of defying it's fundamentals. Additionally it has a dividend yield of over 11%. Yes, it is near it's 52-week high. But I truly want to find out how much profit it can make, as well as how much profit it has to make before it is considered a fundamentally favorable company. That is my opinion, you can take it or leave it.

Disclaimer: See bottom of page. http://investorsopinion.blogspot.com