August 25, 2007
Stock Du Jour (GME) & Random Observations
Good, solid, strong day of buying.
Notable New Lows: Sonic Solutions (SNIC), China Sunenergy (CSUN), US Natural Gas (UNG), and Beacon Roofing Supply (BECN).
Notable New Highs: FTSE/Xinhua China ETF (FXI), China Life (LFC), Aluminum Corp of China (ACH), China Mobile (CHL), TJX (TJX), Gamestop (GME), Blue Coat Sys. (BCSI), and Biogen (BIIB).
I’ll feature a monthly chart of Gamestop (GME) since it came public in February 2002. I never play video games, but apparently others do. ;-)
Cat: | Time: 9:24 am (utc+8)
August 26th, 2007 at 9:57 pm
Uptick Rule - wake up
I dont see enough written on the detriment of the uptick rule being eliminated. In the 30’s SEC was smart enough to establish and prevent bear raids at will which magnified investing risk. Wake up call? wait til we have a really bad bear market and the shorts can pummel with volume.
Those who forget history are doomed…….
August 26th, 2007 at 11:51 pm
Jack: I’m thrilled that the uptick rule was eliminated.
August 27th, 2007 at 6:04 am
I have an account with BECN, they were a New england based co for 60 years until the present ceo capitalized it into a national roofing supply co. They own a lot of wholesale warehouses in the Gulf of Mexico states so a hurricane will cause a rise in price IMO. Although the residential building market is quiet, roofs wear out every day so BECN is in better shape than say HD, they are screwed. Even the upper end Cape Cod market is now hitting a wall. Anybody need a carpenter in China?
August 27th, 2007 at 7:23 pm
I was wondering the same thing as “Jack s” about the uptick rule. I don’t think eliminating this rule (for stocks) matters anymore. Why? Because at least 2 things exist now that didn’t exist in the 30’s: finanical futures and standardized options. After all, buying a put is more or less the same as shorting. Black Monday ‘87 was partially caused by panicky longs exercising their puts and amplifying the downdraft…
August 27th, 2007 at 8:10 pm
steve: Yeah, and the ETFs have always been shortable without an uptick … and the savvy day traders I know were all evading the uptick rule one way or another for years now.
August 27th, 2007 at 10:58 pm
the uptick rule meant little to the big players. there used to be ‘bullets’, but also futures, puts, etc.
in addition - the SEC had been testing the uptick rule for more than a year - a chunk of stocks have had it eliminated for a while, with no affect on those stocks or the market.
the only difference? little people can now short stocks much easier.
btw…on most stocks (via direct access brokers) if you shorted through archipelago, you could short on a downtick for the past couple years.
and speaking of history…you’ll find that the markets which don’t allow shorting, when they’ve had big runups, have long, LONG down periods. longer than those which allow shorting. people prefer going long than short, anyhow….
August 28th, 2007 at 1:49 am
All good points, but, remember if you scare the individual investor off it can take a long time to come back (1974 scared some off until the mid 80’s and lots of brokerages went down on that wave, bond funds dont have the same juice Wall Street needs, dont kid yourself, hedge funds may be going the same way for a while, when the “savvy investors” start telling me this is the only way, I usually make money going the other way, it has worked for me for 30 years: fade the wise guys, stay tuned.