Sunday, January 29, 2006

Cramer, Again

So far in 2006, Jim Cramer's "managed account," which he sells access to for $399 a year in his Action Alerts Plus service, is up 3.14%, compared to 2.34% for the S&P 500. For all of 2005, he also beat the S&P 500, and again by a few percentage points. Not a fair criticism, because he claims to be so risk averse? Check out this analysis of where Cramer is going recently:

The Cramer Files

Yes, that's yours truly in comment #2. (And Ilene had complained about Cramer's NKTR sell alert, so I emailed the link to her too.)


It is frustrating to watch Cramer move smaller cap, less liquid stocks 25% after hours, while knowing in his managed accounts he is buying large cap stocks that do very little and his track record for his own real money buys is unimpressive. But the TV viewers pile in, driving the prices up, while the only sure winners are those already in the stock. It leads me to believe that Cramer doesn't need, or have, any real talent in selecting stocks, he has a following of people who drive the stock up, and then he can take credit for finding great stocks.

When I was a practicing attorney in Atlanta, I took on some client accounts as a money manager, incidental to my law practice, essentially managing client stock portfolios because for me investing was a passion, for them a headache. In my transition to a full time stock trader, I left most of those clients to their own devices, but kept some under management, mostly becasue they insisted. This weekend I sent out the following semi-annual report to one of my clients:


Dear [name omitted],

In the past six months your account has risen....54%.

As I have been e-mailing you on occasion, the largest winning position percentage-wise has been Nanoviricides, up an incredible 1,385% since purchase. Other notable winners have been AVI Biopharma, up 211%, Glamis Gold, up 258%, Novavax, up 164% and Amlylin Pharmaceuticals, up 169%. In fact, of the 22 stocks current being held in the portfolio, 18 are winners and only 4 are below our original cost basis.

As we go into 2006, Biotechnology, Precious Metals and Technology sectors appear poised for significant upward gains in the months ahead and accordingly, that is where I am focusing the account. As the returns above indicate, we are on a run here and whatever it is that is working is what we should be doing in the account.

Best personal regards,

Allan


This return for my client took a lot of work and continual research. I can't call out a stock name on TV and get an automatic 25% gain. This Blog has been mostly about trading and acheiving triple digit returns to make the time, effort and risk worthwhile. But I know that most of you either Buy-and-Hold or Position Trade when it comes to stocks. Some simple strategies will help you to improve your returns, but following Cramer is not on that list.

1. Following the Insiders. Look at Insiderbuying.com for what is possible. Check out the track record, all they are doing is buying stocks with significant insider buying. You learned the importance of that here.

2. Take a shot once in awhile on an NNVC, or XDSL, WAVR or SMTR. If three lose 50% and one gains 1000%, well, you do the math. And keep in mind that just because a friend of yours suggests that the pink sheet biotech stock is junk, that doesn't mean you should sell it, nope, let it keep going up because that is matters here.

3. Some of the best money made the past 50 years has been in precious metal stocks. They seem to run in cycles, cycles that last years and decades. A good precious metals newsletter, like The Dines Letter, will keep you on the right side of those cycles along with providing some highly leveraged ways to play the moves.

Nothing is new in today's blog, you've heard it all before. But there's something about Cramer that brings this out in me.

A

Saturday, January 28, 2006

NVAX & Vaccine Development

Guest Blogger; Ilene

NVAX, which was a very good insider trade, didn't do better yesterday because of the following news from University of Pittsburgh. This isn't good news for nnvc.pk, and it's even worse because they are so far behind, and don't seem to have anything else in development, but nnvc.pk is in a world of its own. As far as nvax goes, the article points out that there's not going to be enough vaccine if there's a problem with bird flu spreading human to human anytime soon, so the competition from U of P doesn't seem like it should be adverse to other companies developing vaccines. Nvax worked with U of P in the past on an AIDS vaccine, though I think the program was cancelled due to "gov't inconvenience;" the work may be ongoing with other universities also receiving the gov't funding, but I haven't looked into it.
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Published online: 27 January 2006; | doi:10.1038/news060123-15
Quick vaccine gets off the starting blocks
Common cold helps grow swift protection against bird flu.
Michael Hopkin

Making a vaccine without the help of chicken eggs could give us easier protection against bird flu.

Researchers in the United States have unveiled a new, faster way to produce vaccines against a strain bird-flu virus. They claim that the technique can create a vaccine against a specific strain within 36 days. This could permit a speedy response should the virus acquire the ability to spread easily from human to human.

The team, led by Andrea Gambotto of the University of Pittsburgh, Pennsylvania, has tested its method by creating a vaccine against H5N1; this strain caused the lethal outbreak in Vietnam during 2003-2005 that killed 42 people. The vaccine provides 100% protection in mice and chickens, the team reports in a paper published by the Journal of Virology1.

Gambotto now wants to proceed with human tests for the vaccine, which would be given as a nasal spray. He has asked for $2 million from the US government to fund a trial that would involve 72 patients and produce results within a year, he told news@nature.com.

Scale it up

Gambotto's team created the vaccine by recreating part of a genetic sequence that encodes a protein called haemagglutinin in the virus. They then spliced this into a modified form of the common cold virus, known as an adenovirus. The resulting package should stimulate the immune system to recognize and attack the haemagglutinin sequence in H5N1.

And this vaccine can be grown in bacteria in a culture dish, Gambotto points out. Almost all existing influenza vaccines are cultured in chicken eggs, and public-health experts have calculated that, at best, the world's capacity for egg-based production could yield about 250 million doses in a year, he says. This is far fewer than the billion or more doses that would be needed, says Gambotto.

Human tests of other H5N1 vaccines have been successful, but researchers have only seen protection from a double dose, and this would exacerbate the shortfall in production capacity (see 'Bird flu vaccine not up to scratch').

Gambotto argues that many labs around the world have the capacity to create a culture-based vaccine - possibly enough to meet the demands of a pandemic. "They should give us the chance to test it," he says.

Not enough?

David Fedson, former medical director at drug company Aventis Pasteur in Lyons, France, is less optimistic. Even using cell cultures rather than eggs, there may not be enough vaccine-production capacity to halt a pandemic in its tracks, he maintains.

Fedson predicts that it may be as much as five years before a vaccine can be produced in sufficient amount by any method.

He also worries that many people in the population are already immune to the adenovirus strain used in Gambotto's vaccine. In North America, for instance, an estimated 30% of people already have antibodies against the strain; this means they could successfully fight the vaccine before they get a chance to develop antibodies to the H5N1 protein. This would make the vaccine ineffective.

Gambotto hopes that delivering the vaccine nasally rather than as a jab could get around this. "Studies have shown that there is no pre-existing immunity in the upper airways, even if there is in the blood," he says.

Gambotto adds that his animal study suggests that the vaccine stimulates a part of the human immune system, called T cells, that previous flu vaccines do not. T cells are flexible, he says, meaning that the vaccine could still work even if the virus were to mutate. "T-cell immunity is more potent," he says. "Only a really smart virus can overcome it."

Thursday, January 26, 2006

NVAX

A heads-up on NVAX, one of our bird flu portfolio stocks. A director just purchased 50,000 shares at $4.00/share. Trade occurred Wednesday, reported today, Thursday. NVAX popping 7% on the news.

A

Sunday, January 22, 2006

Dines Letter Annual Forecast Issue

Jim Dines Annual Forecast issue arrived on Saturday. Forty-eight pages of text, opinions, statistics, analysis and some of the most original and informative charts anywhere at any price. Some snippets follow.

On Uranium:

"In the next seven years the western world's demand for uranium is predicted to surpass known supply sources by 3-million pounds. That means at least one nuclear facility will run out of uranium and need to turn off the lights, as fantastic as that may seem, believe it or not. We can already visualize international headlines about the event. igniting a further buying panic resulting in a 'spike' of urnaium prices to sky-high levels because there is no substitute for uranium."

On Gold:

"One reason we have such high targets for precious metals is that they uniquely go up based Mass Fear, whereas the usual driver of bull markets is Mass Greed. The climax of this gold bull market will be driven by Mass Fear and, unlike greed, fear knows no limits."

On Stock Markets:

"Applying trendline-following to the Uptrends in the S&P 500 and the Dow-Jones Transports is basic, so until they they break down we must assume that the Trend is generally higher and remains bullish until the inevitable breakdown does occur."

On World Politics:

"...Governments will use the war on drugs, terrorism, health crises - anything at all to increasingly control is citizens."

On Terrorism:

"Our predictions have not been so much a war between religions, which will come later, but within, between what we define as the 'orthodox' and the 'seculars,' in every religion worldwide, a brutal battle to the bitter end."

On Health:

"Avian Flu is already entrenched in avian poop in Southeast Asia, which is a ticking time bomb. As you read this the virus is studying us all, already able to jump species (from birds to humans and cats) and is desperate to transmit from human to human - against which we have no immunity and the fatality rate has been that 70% of those infected have died, a horrific ratio suggesting that two-thirds of all humanity is at risk."


Editors Note: The Dines Letter is probably the best newsletter to which I subscribe. There are stock recommendations, but the real value of the publication is Dines' analysis of the world markets and the psychology of it's participants. The Annual Forecast Issue is like a short paperback book, full of timely observations, recommendations and historical charts, almost in and of itself worth the price of annual admission. I hope Jim Dines doesn't mind my posting from his work, but his ideas are worth repeating here, tantilizing and in my mind, leaving the reader intellectually hungry for more.

A

Friday, January 20, 2006

Bird Flu Picks - Update

AVII....Bought 2.25....Current 8.65.......+284%
BCRX....Bought 8.69....Current 20.04......+130%
CRXL....Bought 24.13...Current 25.00......+3%
DVAX....Bought 6.00....Current 5.60.......-6%
HEB.....Bought 2.02....Current 2.66.......+32%
NNVC....Bought 0.09....Current 2.10.......+2233%
NVAX....Bought 1.49....Current 4.95.......+232%
SVA.....Bought 4.05....Current 4.53.......+12%
VICL....Bought 6.00....Current 4.67.......-22%

Average Gain per Pick = +322%

Thursday, January 19, 2006

Stuff

A break in the action, finally, so here is a collection of links that should contain something for everyone:

1. An Interview with Ray Kurzweil. This was posted to another forum by my friend and accountant, Gene Prescott.

"If it were up to the Luddites, human life expectancy would still be 37, and we'd still be dying from bacterial infections," says Ray Kurzweil in this wide-ranging interview. The anti-technology movement "is fundamentally misguided, because it fails to appreciate the profound benefits technology has brought."

2. My new cell phone.

3. Terry Laundry's T Theory, Update.

"Some time ago (see Archives) I reviewed the details of the current big A-D T's construction and compared it to the comparable A-D T coming out of the 1932 bottom to illustrate the basic time symmetry concept. In that analysis I showed that the multiple bottoms in late 2002/early 2003 should be taken as an overall bottom formation and the center of the T should split this bottom range. The left end of these Ts is always at the prior A-D line peak which is very obvious in the chart. Thus the left side of this T is well defined by a cash build up period of about 4.5 years. Assuming inherent time symmetry, which is the fundamental basis of all Ts, then the market advance in stock prices (the S&P) should persist within the right side of the T for an identical time period; that is from the '03 low to the projected market peak, computed to be near March 2007."


4. My new wheels*.

"Driving Impressions:
Endless power from either snarling V8 combined with a tight suspension results in a sports car that never ceases to put a smile on your face. All three of the suspension packages deliver a compliant ride along with white-knuckled handling abilities. The C6 is a comfortable touring car, as well as a world-class performance machine. The Z06 version is an unforgettable monster on the street."


*Subject to an end to winter.

5. Trading. If the rest of 2006 is as good as the first 19 days have been to me and my accounts, I should be able to buy a set of those wheels for all of you.

A

Sunday, January 15, 2006

XDSL - Closer Look

mPhase Technologies (XDSL) sells for 29 cents a share and has a current market cap of about $46M. It's in collaboration with Bell Labs to create a new generation battery, has developed a nano-based metal detector ("Magnetometer") and sells DSL components for delivering high speed broadband data and video over DSL systems. My quick and dirty analysis of XDSL is that any one to these three divisions of their business model is worth three times current market cap, making fair value of the company about 10X it's current price. That's the reward part. The risk is none of their products catch on or are developed and the company languishes as a penny stock for a decade.

Here's a link to their work on metal detection.

But the real kicker in these shares is its collaboration with Bell Labs on Battery Development. Below is a write-up from the Forbes-Wolfe Nanotech Report describing this new batttery technology. At a market cap of only $46M and at the forefront of nanotechnology with a partner like Bell Labs, all we need is the Dent-Wolanchuk Bull Market of Epic Proportions to kick-in for these shares to start flying off the shelf.

A


What do medical implants like pacemakers, military communications
devices, and wireless sensor nets such as those used to monitor humidity
in semiconductor fabs have in common? They all require batteries—
preferably ones that can run for months or years without recharging or
replacement. The market for primary,non-rechargeable batteries is esti-
mated to reach $14 billion in 2007.

Rest of article

Friday, January 13, 2006

Got Leverage?

On December 7th, I published, Got Gold?:

"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."

At that time, Gold was at $505oz, today, it's up 10% from there to about $555oz. The $XAU was at 122; today it's at 141. Those February 130 calls went from $2.10 to today's $13.40 X $13.80.

You can afford to be wrong a few times on these plays, and then be right once to make out very well. Bull markets are like that.

A

Tuesday, January 10, 2006

XDSL - $0.25 share

Guest Blogger: Ilene

Allan, here's something interesting on XDSL, it's only 25 cents/share and in nanotechnology collaboration with Bell Labs and has had insider buying by the CEO. It may qualify as one of your Bull Market Leveraged Plays.

Ilene


Scientific American Features mPhase Technologies Nano-Battery and Reports Progress in Bell Labs Collaboration
Tuesday January 10, 12:04 pm ET

"Miniaturized Power" Article Describes "The Reinvention of the Battery" - Shrinking in Size With the Rest of Electronics

LITTLE FALLS, N.J.--(BUSINESS WIRE)--Jan. 10, 2006--In its February, 2006 edition, the prestigious and authoritative Scientific American Magazine takes a detailed look at the collaboration between Lucent Technologies Bell Labs and mPhase Technologies (OTCBB:XDSL - News) in developing a working reserve battery prototype that relies on a nanotechnology-based architecture.
Titled, "Miniaturized Power," the four-page feature article notes that Bell Labs, where the transistor was invented, "has now become involved with the reinvention of the battery" by shrinking electrodes to nanometer scales. Featuring detailed schematics of the Bell Labs-developed nano-based architecture, the article relates the genesis of the collaboration and describes how the development team fine-tuned the design of the working model based on feedback from potential military customers like the U.S. Army Research Laboratory in Adelphi, Md.
mPhase is developing a new generation of reserve power cells, which could store reserve power for decades and generate electric current virtually on demand. The prototype battery is based on a Bell Labs discovery that liquid droplets of electrolyte will stay in a dormant state atop nanotextured surfaces until stimulated to flow, thereby triggering a reaction producing electricity. The "electrowetting" process, described in detail by Scientific American, in effect can permit precise control and activation of the batteries when required, yielding a very long shelf life. Future batteries based on this technology have the potential to deliver far longer shelf life and better storage capacity than existing battery technology. Reprints of the article can be ordered on the mPhase website, www.mphasetech.com.



About mPhase Technologies, Inc.
mPhase Technologies In! c. (OTC: XDSL - News) develops and commercializes next-generation telecommunications and nanotechnology solutions, delivering novel systems to the marketplace that advance functionality and reduce costs. The company, awarded the 2005 Frost & Sullivan Excellence in Technology Award and the Nano 50 Award from NASA Nanotech Briefs, is bringing nanotechnology out of the laboratory and into the market with a planned innovative long life power cell. Additionally, the company is working on prototype ultra-sensitive magnetometers that promise up to a 1,000-fold increase in sensitivity as compared with available uncooled sensors. More information is available at the mPhase Web site at www.mPhaseTech.com

Monday, January 09, 2006

NNVC

NNVC hit a new high this morning at $1.40 on 1.3M volume in the first 90 minutes of trading. Here's the news:

NanoViricides Collaborates with Vietnam Government to Develop Drug To Treat Bird Flu Virus; Company to receive H5N1 (Avian Flu) biologics from Vietnam

A