Wednesday, December 07, 2005

Got Gold?

I ask that question because Gold is in a bull market and my guess is most of you have very little if any exposure to Gold in your portfolios. As for me, guilty as charged. I have some inconsequential positions in Glamis Gold (GLG) and Coeur D'Alene Mines (CDE), but not enough based on the strength of the Gold chart.

Accordingly, today I'm adding some calls in the XAU index (February 130's), based on the same bull market leverage theory espoused in this prior blog. I am also on the prowl for additional stocks with significant leverage should the bull market in Gold accelerate in the months ahead.

Any gold bugs among my readers, please feel free to contribute your favorite names below in the Comments section. Gold may very well be another ticket to ten-bagger paradise.

A

6 comments:

Ronny said...

Allan,I have tracked 10 buyback plays so far,with 8 winners.The average return for the 10 is +1.7%.
Ron

Allan said...

Ron, So far, so good. How are you tracking winners and returns? From the moment of notification of the buyback, that is public notice, is there a tradable pop in the underlying shares, or is the move up more gradual, or even more market related then news related? Nonetheless, 80% winners averaging 1.7% pops seems tradable to me.

A

Ronny said...

Allan,I track them when the announcement hits the news wire until the next days close.You usually can see a spike in volume in an intra day chart.On announcements made after hours,I use the opening price.I went back and looked at over 50 recent buyback plays (I didn't have the exact time of the announcement) and they did well 2 to 5 days afterwards.
Ron

ilene said...

Ron, I bought a little tqnt and qlti, both after the open. The reduced earnings isn't helping qlti (do you consider that?) but both are up. Another strategy that's worked for me before is to buy stocks being hit by tax loss selling at the end of this month. However, last year, many stocks kept going down in Jan. - Ilene

Ronny said...

Ilene,I omitted one stock that had an earnings warning with a buyback announcement.QLTI hasn't come up on my screen.What is your holding period for the tax strategy?
Ron
PS,there are lot of buybacks in the last day.I will post over the weekend with an update.

ilene said...

It seems to be variable, so you might want to watch the price for signs, but as a guess, about the third week in Dec. for buying, and the last day of Dec. through first week in Jan. for selling -- some stocks may be still selling off at the very end of Dec. and some may be done. Don't hold too long if the market's weak, that's where I messed up last year.