Thursday, August 11, 2005

Theeeeeey're Back

With July earnings reporting over, the insiders are back and back with a vengence. That's where I've been the past couple of weeks. If you're willing to try this trading methodolog on for size, August might be the month to get your feet wet.

Real time example: Last night after the close an SEC filing revealed that a Senior VP of Synaptics (SYNA) purchased $260K worth of SYNA at $15.29 per share. Synaptics has fallen 33% in the past few weeks, mostly due to reports of losing their best customer, Apple Computer, representing a signficant portion of their business. This Insider wasn't as gloomy on the stock as the selling shareholders and stepped up to the plate with a quarter million dollars of his own money. This morning, Thursday, SYNA opened at $15.15 a share, up only 10 cents from Wednesday's close. Not a bad bet. SYNA has run to a high this morning of $15.85, a "pop" of 5%.

This is what we're looking for and the time seems right for paying attention to insider opportunities, right here, right now.

A

3 comments:

Greg Reiman said...

Hi Allan:

Right after the rumor/news that SYNA may lose it's Apple Ipod contract, it gapped down about 25%. I thought this was an overreaction/market discontinuity and immediately bought 1000 shares at $16.25. I set a tight mental stop of $15.75 which I would usually wait to see confirmed at the close before I would sell. It was a busy day (I have just moved to a new job assignment with my employeer and was busy getting into it) so when the price violated my mental stop loss and triggering my desktop alert buzzer, I sold without waiting for the close to confirm the violation. Bad move as by the close it was back up above my stop of $15.75. Lesson learned - there is selling discipline and then there is panic, I should have waited for the close for confirmation. I took a $500 lose that I didn't need to take. On the bright side, I owned this stock earlier in the year when it went as high as $40/share and got stopped out at $36, so in that instance the discipline worked for me. Just some rumination on my learing curve. On a side note, do you think SYNA will ever see thier partial ownership in Foveon make an impact? I am beginging to have doubts that anything meaningful will come of Foveon.

Greg Reiman

Allan said...

Greg, Foveon is either the greatest thing since sliced bread or another Gilder pipe dream ultimatley to be relagated to somewhere between a camera niche player and techno-oblivion. I don't have the patience to stay for the end of this movie.

A

Greg Reiman said...

I just checked the chart for SYNA and it appears that I would have stopped out even if I had waited for closing confirmation a few days later, so I can stop kicking myself now. Although, I was still right in hindsight about the original gap down being an overreaction, as the price is gradually moving back up, at least for now. Lesson learned - still trying to figure that one out?

Greg Reiman