What We're Reading

All Posts (756)

Lazlo Birinyi and his associates recently completed a study of the VIX. Their conclusions were that the VIX is not a very good indicator of future market movements. Instead, it is simply a mirror image of current market conditions. Their conclusions prompted me to look at the VIX over the past twenty years. Truth be told, GT made me do it. LOL He brought the study up in chat and challenged me to back up any argument for or against with real statistics. Always good advice...

First, let me state that I agree with Mr. Birinyi's conclusion. I overlayed a chart of the S & P 500 on a chart of the VIX from 1990 to present. At least on the surface, it even looks like a mirror image. Granted, I do not have the time nor the inclination to replicate his study methods. Anecdotally at least, it looks like he is on to something.

Next, I became curious if the VIX had any other uses outside of options strategies or if there was a VIX trade with a high…

Read More, Comment and Share......

Confessions of a Biotech Investor

Recently I purchased a small position in MannKind (MNKD) on a pullback, cost basis 10.03 a share. Seemingly went up everyday. Then, it fell off the cliff. A FDA request for additional information and it's interpretation tanked the stock. Down 24% in one day, it has continued to selloff. Currently down nearly 40% from my original buy point and it has no signs of slowing down. While I have no special insight into the workings of the FDA nor the drug, Affrezza, up for approval, I have to say that the market reaction is wrong in my opinion. I will double down if it falls to or below 5.50 a share.

I understand this is a very risky proposition, especially from a technical analysis standpoint. All I can say is I've got a very strong gut feeling that it gets approved with few if any hitches. I'm following my gut this time....

Read More, Comment and Share......

Random market thoughts

While running a simple screen for Cheap Growth stocks, I had something unusual happen. There was not a single stock that met the criteria. That's right, zero, zilch, nada. The screen only had three criteria; a PEG ratio of .75 or lower, a debt to equity ratio of .8 or lower, and an expected growth rate of 25% for the next 5 years. Only two possible conclusions can be drawn from this. Conclusion A, growth stocks are way over valued at this time. Conlusion B, analyst estimates for earnings growth are still very bearish, too bearish in fact.

My past experience with this screen leads to me too conclusion B. I started using this screen six months prior to the beginning of the bear market. At that time, there was no shortage of cheap growers. In fact I had to add a market cap component to reduce the number of possible candidates. Since the screen depends heavily on analyst earnings estimates and considering the events that occurred half a year later, I would conclude that…

Read More, Comment and Share......

Admin

What Is A Badge?

One of the most important lessons I learned in business is that a personal recommendation is more valuable and more trusted than any advertising or promotion in the world; and it's true. That's what our badge is all about.

You'll notice this little box on our Main page saying "Do You StockBuz?". By clicking on this badge, you will be allowed to customize a badges size and color to embed in your blog, webpage, other forums or sites you navigate each day as evidence you enjoy your experience here and wish to turn others on to it.

I hope you are enjoying our new home as much as I and I hope you will use this badge to help us grow, as we build a new home for other investors just like us, sharing from across the globe with different interests and levels of expertise. Thank you for being part of our community and spread the word. Do You StockBuz?

Added 3/30/10: I have discovered…

Read More, Comment and Share......

We welcome you to post a blog entry, oped or share your daily reading with us as long as it is relevant to the topic of investing and not an attempt to sell a product, proprietary strategy, platform or other service. Please provide links to any research data and if re-posting other articles, give credit where credit is due providing a back link to the original site.

300 words minimum per post. You may also sort by category or search by topic. Don't forget to comment and please "share" via Facebook, Twitter and Google+. If you have any questions, please contact us.

FOLLOW STOCKBUZ

__________________

This is a member-supported site. Please donate when you can to help pay the rent. Thank you!

Stay Informed. Sign up for the FREE StockBuz eNewsletter

________________

Investing involves substantial risk. All content is subject to StockBuz disclaimer.

Create Income With Option Spreads

All content on StockBuz.net is subject to disclaimer and Terms of Service