Friday, December 02, 2005

Leveraging the Bull

Harry Dent's December missive to subscribers was about how the major indexes have broken out and he is sticking to his DOW 14,000 - 15,000 range by August, 2006. As you should know by now, my style of trading doesn't rely upon market direction as a major contributor to success, although it does help somewhat to be on the right side of the trend. Nonetheless, a rip-roaring bull market, the type that Harry Dent and Don Wolanchuk are suggesting are in the cards for us, begs the question, how to make the most of the coming fireworks?

One way is by leverage. Low-priced stocks, options, futures and options on futures all provide significant leverage in the direction of the major trend. Maybe the trickiest of the lot are low-priced stocks, the good, the bad and the ugly. We already have NNVC on our plate, hopefully in the realm of the good. Here's another one, courtesy of the aforementioned Don Wolanchuk: WAVR.

Waverider Communications from their website:

WaveRider Communications Inc. is the world leader in non-line-of-sight wireless broadband technology and deployments. With WaveRider's industry-leading product line and strong management team, the company is positioned for growth and to compete successfully in the world broadband market.

The link above takes you to their web site and that was my first stop before buying my initial position in the company. I like the fact that it's only about 15 cents a share and that Don is pounding the table on the stock. I also like the fact that WAVR was a $6.00 stock in May, 2003 and a lot higher then that in the go-go year of 2000.

It's a roll of the dice, but that's what we do in a bull market, right?

A

4 comments:

Ronny said...

Hi Allan,I have 6 buyback plays recorded so far.I calculated them the way you suggested.Of the 6,4 were winners.The average gain for the 6 was 2.0%.There might be something here.Only time will tell.
Ron

ilene said...

Hi, Ronny,

Do you mind sharing the buyback plays and how did you find them?

Thanks, Ilene

Ronny said...

Hi Ilene,you can go to realtimetraders.com.I am not a subscriber,so I don't get real time announcements.
After I get the stock symbol,I go to Yahoo Finance and look up the days news to find out the exact time the announcement hit the news wire.My last step is to go to bigcharts.com to figure out the price.
I omitted 2 that didn't have enough volume.The 6 I have tracked so far are: de,pfg,dhi,fto,cbr & chtt.
Allan has been very generous with his observations,so I thought it was my turn to contribute.
Thanks,Ron

ilene said...

Hi, Ron,

Thanks for doing the work, it seems like we should be following these, perhaps subscribing to realtimetraders or other service for the news. CBR also had insider buy recently.

Ilene