Quick notes: NTE/CMGI

This is going to be quick. The chemo is doing a fine job of making me feel like a zambie. Next week is my CT scan to see how my cancer cells are doing. They better not be having a party inside.

NTE: Jumped due to better than expected earnings. Actually, I was impressed more with the +5% in revenue. When valuing companies I place more weight on growing revenue than the earnings. Why? We, the financial guys and gals can easily tweak the earnings numbers. There are many accounting ways to play around with the earnings. However, you simply can not fool with the revenue (sales) numbers. The only way for you to grow revenue is to have the people buy your stuff. And the only way for the people to buy more of your stuff than before, is to improve your stuff with better prices. This is easier said than done. NTE is doing it. Nice. Short term, NTE will likely dip a bit but longer term this looks great. In December, we will receive yet another generous cash dividend ($0.38/share) while we wait for even higher prices.

UTK: Are you satisfied with the price action the last few days? I am. So far, so good.

CMGI: The day after I place a buy order, this jumps +8%. Many big investors were thinking the same thing as I did. I placed an initial order to buy it at $1.33/share. I will be patient for now. By the way, just know that this is a dream stock for the dat traders. Expect volatility with this one.

P.S: When sending me a comment, please do so in the latest article eventhough the question is related to past articles. I do not check past comments all the time. I always read current comment section below.

PPS: Election is only 7 days away. Expect wild price movements.

Review of holdings: CMGI

Another round of chemo started yesterday morning.
The battle begins again. I just hope that I won't get a bad sore mouth this time. The main drug in my chemo cocktail (yes, they call it a cocktail mix of drugs) is called 5-FU and this drug targets and kills "fast growing" cells in your body. Luckily cancer cells grow more rapidly than normal cells in general but unfortunately cells in your mouth and stomach grow fast too. Oh, by the way, your hair cells grow fast too, that's why we loose hair during chemo. Anyway, my injection will last through this Wednesday - can't sleep very well.

Back to business:
First let me give you quick updates on our stocks and I also have a new player to introduce to ya. This new guy was my old time favorite but I managed to lose quite a bit of money. I feel it is time for me to get my deposit back. But updates first:

UTK: Acting nicely as per my previous writings. Dr.Gross (the CEO) directly owns 2 million shares out of about 9 million total shares (that's about 22% of the entire company). During the entire 2006, none of the insiders (including the CEO) sold any of UTK shares they owned. Another good sign. This Friday, management will host a conference call at 10am. I trust that the CEO will do whatever possible to move up the shares. Afterall, he has all of his eggs in this one basket. From my previous meetings with him, he seemed like a stright-shooter. Let's give our CEO time to do his job. He's been doing it well.

NTE: Notice how this baby keeps going up sine the meltdown? Oh I wish I had bought more at low $11 only a month ago. Remember too that the shareholders received generous cash dividend on 10/21 as well. For the 3rd quarter, revenue was up but profits were down due to intense competition. Nothing we didn't know. Wall street expected EPS of $0.23 but it delivered $0.28/share. Not bad. The pricing power squeez will continue for a while but when everything is said and done NTE will be the survivor. Try to own this for the next few years.

MATK: The company came out with the plan to restructure in order to save expenses. Business looks solid. Waiting for more food deals. It recently announced a few new smaller deals. MATK will be moving up in the coming months. Be patient.

IGLD: Fantastic business excution so far. Go back and re-read my full analysis on this one. Seems a bit extended but looks good long term. Earnings report on 11/6. I really feel that this can trade in the double digits next year. I just love the name "Internet Gold" as well as its "Smile : ) " logo. People in the Middle East is quickly getting the hang of "Internet stuff" and IGLD is in a good position to take care of its needs. Nice.

XMSR: I know it is not pleasurable to watch prices go down from your buy point but you really need to change your mind set. If you're about to sell, you want the price to be high. If you are still in the accumulation period (which I am in - I only have half a unit on this one) you want the price to fall. Does this make sense? Oh, why then didn't I wait till it falls further before buying? Because I don't have the crystal ball with me - lost it - actually, never had it. Buy things in steps unless you really like the price. Another lesson learned? XM just signed on Porche as an exclusive provider. Last night, XM also just launched new satellite code-named XM-4. Nice.

IDWD: Too many exciting things are happening with this one. Although it is the riskiest of the bunch, it also made me quite a bit of profits along the way. I am willing to hold and wait for the POP. If you own this, sell at least half whenever it reaches a double. It is so much nicer to play with the house money : )

So who's the new player?
None other than the venerable "CMGI". I will do a write up on this one soon. Don't ask me how much this used to trade at. You don't want to know. I once bought this at over $45/share! It was a steal at the time. Oh, well. So here's the what's up:
Hewlett-Packard Co. (HPQ) finally disposed of its remaining stake in CMGI Inc. According to a Form 13G/A filed on October 23rd, Hewlett-Packard no longer owns any shares of CMGI. The computer giant owned a little more than 12.1 million shares of CMGI at the end of 2005, down from about 24.5 million shares, or a 5% stake, as of June 30th, 2005. Now that the big giant has no more shares to sell, sell, sell, we only need a little buying to move the price up. And it is already moving. It just moved above the important 200-day moving average. Buy it but again, don't chase it. Acetrader will buy this soon too.

Traders: The market is trying to pull off one last bull move before falling. I've been buying QID during the daily highs and selling it with incremental profits. Now only own NDAQ (short position) in my trading protfolio. Will be buying QID again if market shows strength and take quick profit. Get out quickly in this types of markets until clear trend unfolds.

Update #4: UTK / XMSR

Wow, what a week!
One thing is for sure: Acetrader is a great learning vehicle for investors. Let me remind you, the purpose of this blog:
"This site was designed to communicate with friends who share similar interest. The interest in the "free market". Stocks, over the long term, provide the best return on your money. More than cash, bonds and even real estate. Understand that investing is a learning process. We will learn from our mistakes and move on. This is a journey. Enjoy the ride!"

I am sure above quote is familiar to all of you. I am also sure that you're all enjoying the ride. I certainly am. Below, I will express my opinion on issues regarding UTK and XMSR. Both of them were picked by me when most of the other investors were not interested in them. Thus, I was able to buy them when the asking price was low. I still believe that my initial analysis were correct. Only time will tell. Bottom line: Do not sell UTK or XMSR until I say so.

First, let me re-print a view from my friend/fellow analyst, Siyu:
Siyu LI said...
I wasn't surprised that some of their partners has questionable background, or has a questionable business. I don't think that shall be the reason to sell the stock, here is why. By the nature of their business model, they mainly deal with micro-size company - Pick Sheet, Over the counter, or start-up. Very few investors buy those stocks in anticipation of 10% - 15% annual returns - it is either 100% loss, or huge gains. This indeed, makes UTK's model more attractive - it diversifies the portfolio by making deals with a lots of those companies. So, if you believe in their business model, the real question is do they have a competent management team with good judgement, execute deals in good faith, each and every time? Well, that's your call...

Siyu obviously understands the situation. UTK provides services to those companies that do not have the capability or the means to find the right technology themselves. The real big companies have the financial resources to have their own "new business aquisition" department. For smaller companies, UTK is a good source of ideas - and they are willing to pay for it.

Here's my take on current issue with UTK. To understand this clearly, allow me to use an analogy: 1. Suppose you were an attorney 2. A client comes in 3. You find out that this potential client has questionable past business dealings that's not related to your business at hand 4. Would you accept this client (he's going to pay you) or refuse services because of his/her past?

I don't know about you but most attorneys will work with above client (as long as they can pay). Remember that we are not in the business of judging people. Basically, I do not fault UTK for having done business with people who had failed businesses previously. Let's not forget that vast majority of businesses fail rather than succeed. ( By the way, expect to have many of your stock picks fail. One stock that succeed, will cover several failed stock picks. Those who are new to investing, simply take my word for it. In time, Acetrader portfolio will prove the above. With all these pot holes, Acetrader is still up more than 40% YTD).

The real issue is whether UTK is using fair method of accounting for stocks it owns in its portfolio. Remember that UTK owns over $60 million worth of stocks in its balance sheet. This is the real issue. For public company stocks, it is easy - the last traded price. However, for those non-public company stocks, it is somewhat iffy. The UTK management states that they use conservative, fair value methods when needed. I just have to believe in the management as well as its board members and auditing accounting firms.

Within a week from now, UTK will hold public conference call session to discuss its quarterly business results. Guess what. I expect them to release a fantastic quarter. I am also sure that they will talk about current issue as well. Let me put it to you this way: I would not want to be short UTK until next week. I expect that many short sellers will try to cover (buy back shares) their share soon. If this happends, price will go up. Let's see. Hold, hold, hold.

XMSR: Some of you were scared when the price went below $10 (it went as low as $9.91). Within 2 days, the price is back up to near $12. What does this tell you? Friday, XM traded over 27 million shares in one day! Hmmmm... Somebody obviously knows something that's not public yet. Could XM be taken over? I don't believe Opra's debuit did this either. It doesn't matter. What's important is that XM is worth a lot more than the current price. I am right - they are wrong. XMSR is much better value than SIRI. You wait and see : )
Bottom line: Buy it, just don't chase it.

Update #3: UTK

I just spoke with the people at Utek.
My only wish was for the company to issue an official answer to the alleged claims. I think the management was caught off-guard as well.
Please visit the company website. (see below)
1. From main page, click "investors relations"
2. On the right side, click "Fact Sheet"
3. Read them carefully.

There are just too many legit people working here for me to think that these are crooks. You investigate it for yourself.

Utek Corp.
2109 Palm AvenueTampa, FL 33605United States - Map
Phone: 813-754-4330Fax: 813-754-2383
Web Site: http://www.utekcorp.com

Update #2: UTK

For your eyes, I am showing you what others are saying today.

1. Below is a copy of note posted by one of the investors today:

Just now investor relations returned my call. I asked why is UTK down? I don't see any news. They said that someone had shorted many shares of UTK and spread rumors about UTK's NAV stock price, however there is nothing to worry about. Call them yourself at (813) 754-4330. If they are busy leave them your number and they will return your call.

2. Another investor had this to say:

Once again here are the facts! UTEK invested in technology licenses of about $800,000 which were subsequently transferred to XNL for shares of its stock. UTEK cashed out of XNL close to $5 million. UTEK continues to hold about a million shares of XNL. At the current price of XNL of three dollars per share, UTEK total benefit from its technology transfers equal to about $8 million. $8 million compared to $800,000 is a significant gain and validates the technology transfer model. Anyone who argues differently is stupid!For 2006 so far,UTEK has made public that they conducted 24 technology transfers. There are close to 50 strategic alliances acknowledged.Since most of the stock received from the technology transfer is restricted from sale by one year. UTEK sells a portion of the stock after the restriction lapses equal to their original investment in acquiring technology licenses that are immediately transferred to various companies. As a result, within the next 12 months the company will generate lots of cash at least from the lapse of restriction of the stocks they hold.

Note to self: This can be one of two things.
Either this is a real buying opportunity OR this is a beginning of a melt down of Utek business. Personally, I believe in tech-transfer-for-value business model. UTK is simply acting like a broker/consultant to small tech companies. Basically, commissions are paid with restricted (for 1 year) shares of these public companies. I know that the demand for these kinds of services are hugh and Utek is one of the first companies to take care of these needs.

I, for one, believe in the Utek business model.
Let's just hope that there is no foul play here.
For now, I believe in the current CEO and my gut feeling.
Let's wait for the official news by the company itself.

P.S: STMP is up to $17.24 today. We bought this two days ago at $15.08/sh. Nice +15% move in a short time.

Emergency notice: UTK

My heart dropped when I looked at my computer this morning.
As of this writing (11:58am) UTK is trading at $12.99 (down $6). The average volume is about 30,000 shares a day but so far it has traded almost 700,000 shares in just over 2 hours of trading. This is an emergency case.

Please go to the website called Sharesleuth at: www.sharesleuth.com

It says that the company UTEK (UTK) is a fraud. That the shares it owns in various companies are worth almost nothing. What's my take? I do not know the answer. There are no official news from the company itself.

The best course of action is to wait until the dust settles.

I have personally met with the CEO of UTK. My gut tells me that he is not a crook. You don't find too many crooks that have earned PH.D. But I can be wrong. This is why we need to diversify our holdings. In stock investing, diversification is key. For the Acetrader portfolio, UTK represents about 8% of the total value. This is a good size of the portfolio but not big enough to cause too much damage. The kinds of damage that you can not get out of.

I will update you on this frequently.
I am not selling my shares until I find out the truth.
You should do the same - "never panic".

P.S: Please note that the principals of the article Sharesleuth.com shorted 75,000 shares of UTK. Hmmm...

The cubes: QQQQ

Regular readers know that I enjoy mountain hiking every week. There is no better way to improve your health than hiking in the mountains. Today, along with my hiking group, we went to a place called "Mohonk Reservation" in New York. A beautiful 100 year old hotel & restaurant in the middle of mountains. The view was spectacular! Some areas of mountains looked like it was on fire! The color of the leaves ranged from light yellow to deep fire reds. I sincerely hope that you can enjoy these kinds of beauty too. Soon, most of the leaves will fall to the ground, providing much needed nutrients for the trees, the cycle of life will begin once again.

Most investors look at various indices to gauge the health of the market. The Dow30 / SP500 / Nasdaq composit / Wilshire 5000 are some of the most widely followed indexes people look at. Of course I, too, look at all of them as well but do you know which index I follow most closely? It is no secret that I follow the "Cubes" (QQQQ) very closely. The cubes are consist of the top 100 Nasdaq stocks in one basket. How convenient? Basically, these are the companies that will transform the future of our lives. Allow me to name the top 10 of these guys for you:

Microsoft / Qualcomm / Apple / Google / Cisco / Starbucks / Intel / Amgen / Oracle / Comcast

All of above companies are the kinds that we all wish to own if money was no object. Actually, you can own all of them by simply owning the cubes. Where am I going with this? The big picture: QQQQ is an excellent long term investment - it will usually lead the market on the upside as well as the downside. The small picture (next few days or weeks): Cubes look to be extended, pricy, too much too soon.

Traders: I have established a short position in NDAQ at $37.4 8/share.

P.S: Hold on to all of the stocks in the Acetraders portfolio. I will let you know if any one of them is a sell candidate. Try to be patient with our investments. Step back and ask yourself "How long have I had them?" and "Am I giving this investment a fair chance to perform?" I personally do not like to sell unless the business plan has changed. Be patient.

My CEA level: STMP

My oncologist, Dr. Chung at the Memorial Sloan-Kettering Cancer Center in NY, just got married last Saturday. He is the only Korean oncologist at the hospital. Dr. Chung has impeccable record as an oncologist and that's why I chose him as my "quarterback" in the battle against colon cancer. Just so you know, I am doing quite well so far. I feel that the new drug I am taking (erbitux by Imclone Systems: IMCL) is having positive effect on my cancer cells. My current CEA (carcino embryonic antigen: tumor marker) level in my blood is 4.4 - prior to my surgery in last October, the CEA level was a whopping 130! (lower number is better).

Normally, I would have recommended Imclone (IMCL), a biotech firm as our potential investment idea but I happened know that Pfizer(PFE) is about to release a new drug that will compete directly against the erbitux. When a giant pharma like Pfizer is on your ass, you know you're in trouable - just look at the price chart of IMCL. Stay away.

Now, it's time for me to introduce our recent investment:

Stamps.com, Inc. (STMP) provides Internet-based postage solutions. Its service allows customers to buy and print United States Postal Service approved postage. The company offers PC Postage service that enables users to print information-based indicia or electronic stamps, directly onto envelopes, plain paper, or labels using ordinary laser or inkjet printers. Stamps.com also offers PhotoStamps, a form of postage that allows consumers to turn digital photos, designs, or images into valid U.S. postage.

STMP enjoys almost monopoly like status as an online postage solutions. As recently as this May, STMP traded as high as $40/share. There are two reasons why this is now selling at $15. First, potential competitor has emerged. Second, a billing problem caused lower than expected revenue in the latest quarter. I believe that both problems are not as significant a problem as many see it. In any case, I welcome these kinds of temporary mishaps by otherwise fine growth companies. We just got 60% off sale from Stamps.com.

Acetrader has bought initial position of STMP at $15.08/share. Try to add this in your portfolio slowly - there will be many chances for you to buy this at favorable prices. I just love shopping...

The general market seems way overbought. I smell a downturn sooner rather than later. So, do not chase to buy stocks. Be patient.

P.S: IDWD will come out with some positive news tomorrow. Hmmm, what could it be? This is one crazy stock for sure.

PPS: My initial position in XMSR was at $11.20/share. If this goes to $9 and change I will be a buyer yet again. Let's hope that it gets there.

19 Years under my belt: STMP

Most of you probably missed it.
Last Thursday (October 19th) was 19th anniversary of the famous "Black Monday"! Which means it is also my 19th year in stock investing. How time flies ...
On black Monday (October 19, 1987) the Dow fell more than 500 points. By the way, 500 points is a big deal even today with the Dow above 12,000. Back then, the Dow was just above 2,000 ! - can you believe it? I remember watching the CNBC on TV not believing what I was watching. No away, this must be a joke, I thought. Stocks fell every second without any support - it was amazing. Oh, most people don't even remember that the day before black Monday, Dow fell 190 points! So, we are talking about over 700 points in two trading days! Trust me, I kow what pain means...

When I first started buying stocks in 1987, I bought two stocks. Seagate Technology (was bought 0ut) and Mylan Labs (MYL). My third stock purchase was Owens Corning Fiberglass (owenq). Owens Corning is becoming interesting again - that's for later. Are you at all surprised that I remember my first three stock buys 19 years ago? When it comes to stock related information, I act like the "Rainman". I remember all kinds of craps.

Fast forward 19 years.
Last Friday, a new addition was added to our Acetrader portfolio. Stamps.com (STMP) was purchased at $15.08/share. This might go down a little more from here so use your discretion. Why did I buy it if I think that it could go down further? Because I know a value when I see one. Problem is that others do not see it the way I do. They might push it down further. If that happends, I will be happy - I will be a buyer, lowering my cost.

There were two stocks that I always wanted to buy but I felt that valuation was too rich for my blood. They are: Stamps.com (STMP) and Akamai Technology (AKAM). Now, finally, I can allow myself to buy Stamps.com and hopefully soon, Akamai will give me a chance too. Both companies are wildly profitable and growing. Some analysts however, turned negative toward these lately. Good for me - good for you as well. I will have a write up tomorrow after my chemo session at the hospital. Until then, do your own homework if you care to.

Today, I was at the NFL game in New Jersey (NY Jets vs. Detroit Lions). I have never been to a NFL game in my life. I have seen college games in the stadium but never the professional NFL games. What a day I had! I really enjoyed the game - the final score was 31 to 24 NY Jets. I now understand why the tickets are all sold out for the next few years in advance ( I mean the entire stadium of 70,000 or so seats). It is really fun. I am going to put meself in the waiting list for the season tickets. Hopefully I will get the chance in a few years :)

Money talks and bullshit walks.
No finance, no romance.

Are we all on the same page now?

P.S: Some of you might have been confused about my comments regarding the XMSR in my previous blog. Please note that it was under the "Trader" section of the article. For Acetrader portfolio, it is still a buy. XMSR is giving me a chance to buy it again. I'll take it - slowly.

PPS: Due to recent new highs in IGLD, it has grown substantially in size. I have sold some to raise money for the STMP purchase. I am still very bullish on IGLD's future prospects. Sometimes, you have to manage your portfolio where you have to sell things in order to raise money for the new players. We will see above average profit in STMP in a year or two.

IDWD news

The market seems nervous.
Why? Earnings are coming in but we all knew the earnings would be good anyway. It is already priced into the stocks. Next, a very important election is only few weeks away. Democrats want controlled trade policy as well as higher taxes. This would be definately bad for the market in general. The Republicans desparately want to have the control of the congress. This looks to be a challenge as well. When people are not sure of the outcome, chances are, stocks will fall. You do the math yourself.

Tonight I will be in the city (NYC) to enjoy concert run by various Korean artists. Top singers (se7en / Big Mama / Gummy / Lexy / Stony Skunk / BIGBANG ) will be in this concert and it will be a major treat for me. It is not everyday that Korean musicians come to the Madison Square Garden to perform. I'll fill you in later.

IDWD jumped to as high as $1.13/share today on positive news regarding the buyout. First, here's the news:

HLS to Move Forward With Acquisitions
ORLANDO, FL--(MARKET WIRE)--Oct 19, 2006 -- IDS Worldwide, Inc. (Other OTC:IDWD.PK - News) was informed today that HLS Executives' meetings with their legal and banking advisors were successful. HLS has informed IDS that the financing structure for the previously announced $2.35 cash buyout of the outstanding common shares of IDS Worldwide, Inc. has been completed.
IDS and HLS, after the Eid Holiday, will release definitive details and timelines pertaining to the final closing of the transaction. Each common stockholder of IDS common shares (Other OTC:IDWD.PK - News) will receive $2.35 per share cash for each share of common stock owned. IDS majority insiders are approved to receive HLS bonds and stock for their IDS common shares.

Once again, there are many who do not believe that this will occur. That's why the stock is at $1.03 instead of $2.03/share. I have told you many times that this is a potential homerun stock. At the same time, if things don't workout, shares will fall like a rock. At this point, my 20,000 shares were bought with the house money. If you read my past notes, you will see that I have taken numerous profits from IDWD already. You read the news and decide for yourself.

Yesterday, I said that GOOG will hit new all time high this year. Guess what? GOOG is up about $37 after hours trading at $457 per share! Just yesterday, it was going for $418. Nice timing on my part...

Traders: Told you yesterday that I have shorted AXR. Today it fell over $5 per share - down 7.2%. I have covered for now - too much too soon. Good chance of bouncing up before falling again. Please understand that AXR shareholders are not used to its stock falling. They are likely to act like lemmings - follow each other to fall off a cliff one by one. Another perfect timing on my part - getting lucky too often, I must say : )

XMSR fell too hard today. I went long XMSR at $11.27/share. Will take between 2.5-3.5% and I am out. I generally do not wish to hold positions overnight in my trading account unless I have to. I normally buy between 1,000 - 3,000 shares and will leave the position if I have a minimum of $1,000 gain or higher. I call this "sniper" trading.

One bullet, one kill, I am out before you know it.

Smile: IGLD

Just so we are on the same page, I am having difficult time eating anything solid. The mouth sore is here again. This will last at least a week. Trust me, I know. The worst part is that I am a person who really enjoys food. I weight about 140 pounds now. I don't eat a lot but I enjoy good food. Let me put it to you this way; during college (Washington University) I was the head of my fraternity "Tekes" (TKE: the largest social fraternity in USA - President Regan was a Teke too). In addition, I was the chair for the "food commitee". Yes, my responsibility was to find good food at great prices. By the way, the commitee still meets to this date. Basically, I have been a chairman for over 15 years now. Remember our deal: Anyone who reads this blog regularly, buys food for me when we meet. I never meet with anyone without food being involved somehow.

The Dow has officially touched 12,000 level and as I expected, the market is ready to take a brief rest before resuming the up trend. My QID holdings in my trading account is becoming very profitable indeed. This will last at least a few more days. Today, I will update you on a new rising star in our portfolio: Internet Gold (IGLD). This has been hitting new highs for a while. Anyone who still does not own this yet: Woooo, I am sorry, I only told you 10 different times : )

This is why you want to own IGLD:

1. Internet Gold is the "mother" company of two different companies.
1a. Smile.Communications: International telephony business
1b. Smile.Media: IP media business in Israel

2. The company recently rebranded itself under "Smile" brand.

3. :-) this is the logo.

4. Over 20 consecutive quarters of positive net income and positive cash flow - wow.

5. Last quarter: Revenue +29% Operating Income +43%

6. Just bought controlling interest in 012-Golden Lines (this will be part of Smile.Communications)

7. Smile.Communications is now the #2 player in Israel's ISP and international telephony business.

8. Smile.Media owns the MSN of Israel - nice.

9. Mr. Eli Holtzman, the CEO of IGLD, was also the CEO of Israel's largest advertising agency and he will now focus his efforts on investors relations (most investors do not know about IGLD - but you do)

10. IGLD is a "controlled company". Shaul and Yossef Elovitch (brothers) own 12,683,135 of the 18,431,500 million shares of IGLD (this represents about 69.74% of the company and they told me that they are not selling).

Bottom Line: As the company grows and more investors get introduced to IGLD, the stock price ($7.58) will go up nicely. Most of us bought this in the $4's and $5's. We will be selling (maybe) in the $10's and $20's - it's that simple. Please visit the company website at www.igld.com

Aren't you glad that you have someone doing all the homeworks for you? And I do this in quite a detailed basis. I do deserve food when we meet OK?

Traders: I still hold QID. Took profits in shorting PCLN (shorted $40.82 covered $39.99). AKAM looks oversold (I love its business) looking to go long anytime now. Just shorted AXR - will let you now. The market will slow down a bit before jumping again.

P.S: Google (GOOG) now at $418 will go onto an all time high soon (all time high was at $475).

Motorola Q: BTYH

Regular readers know that I suffered a major sore mouth about two weeks ago. Basically there is no cure for this and you simply have to wait it out until the sores heal back which takes about 10 -14 days. That was bad. I could not eat for two weeks.

Now, do you know what's worse? Can you imagine what it feels like to eat things that taste like plain paper? Chicken, beef, shrimp, you name it - they all taste like chewing white paper. Luckily, this is a temporary situation I was told. Chemo therapy does many weird things to your body. It slowly kills you. I just hope to god that those cancer cells are suffering more than I do.

Great news: Bad Toys (BTYH) just announced that it filed necessary papers to go ahead and spin-off the Southland subsidiary with the SEC. BTYH will distribute 75% of the new shares to the existing shareholders (that's us). It will keep the remaining 25% with the BTYH shares. Why is this a good news? Because I feel that the new Southland shares will fetch much higher multiple than it currently gets. Translation: Higher stock price ahead. The actual approval has not come yet but I see no reason why this will not occur. You should all know that Acetrader bought extra 10,100 shares at $0.62 on October 5th. We now own 30,100 shares.

IDWD is coming up with many good news fundamentally. However, the price has not been with the program if you know what I mean. Potential homerun candidates will do this to you. It is trying to get rid of weak hands. I will be hanging tough since I am playing with the house money at this point. We took several big profits on this one in the recent past. HOLD.

I just got my first ever PDA cell phone. The "Motorola Q" is the name. Now, I can trade stocks while I am in the hospital bed with needles sticking out here and there. I am officially dangerous. I will let you know the first stock trade excuted on my phone soon. What a technology! This is why I am so bullish on QQQQ long term.

Short term wise, I am short QQQQ now. I truly feel that the market is over extended. I do not see much gains without some pull back soon. Thus, I am bearish in the short run. Although I did not publish in this pages, I went short ICE three days ago. Shorted at $87.50 covered at $84.50 but it is now at $77.30! Ouch. Do you want my next trade idea? I am looking at three short candidates: PCLN $41.09 / OMG $58.07 / AXR $65.89 (these are closing prices).

Tomorrow, I will probably short PCLN in addition to the QID I already own.
Good luck Gus!

MidasTrade.com: MIDS

Another weekend has passed.
Do you even realize that there are only 10 weekends left in this year? Next month (November) is my one year anniversary of being a "cancer" patient. This is a good sign - the average survival time for stage IV colon cancer patient is about 9.5 months. Now, officially, I am above average. Obviously, the next key date is November 2007! Wish me luck...

United States has a population of just under 300 million people. If you were to count by the number of "households" we have over 100 million households. Guess how many of these households are consist of "married" couples? Try less than half! We now have more "divorced" or "single" houses than married family households. This is a problem. A real problem for those kids. Sometimes having both a father and a mother isn't enough. If you are missing one, you are really missing a lot. The real sad part is that many of those kids do not even know what they are missing. We really need to do a better job in this regard. Let's spend more quality time with our kids: sons/daughters/cousins/nephews/neighbors and grand kids.

One of the more quiet stock in our portfolio is Midas. The truth is that there were no real news to report to you recently. Please re-visit my article dated 8/4 and 7/31 (this should help). This company is young and new (trade in the Pink sheets) so it is very difficult to get detailed info. However, I have done my own due dilligence and I feel that this offers more upside than down side. Connecting the investors between Korea and the U.S. is a big deal. Koreans love to trade. They trade a lot. And, they have the money! I have confirmed that MIDS has signed deals with the top Korean brokerage houses. Please read the latest news below:

BUENA PARK, CALIFORNIA, Oct 13, 2006 (CCNMatthews via COMTEX) -- MidasTrade.com Inc. (PINK SHEETS:MIDS) will host a conference call for shareholders and members of the financial community on Monday, October 23, 2006 at 4:00 PM EST / 1:00 PM PST. The conference call will be hosted by MidasTrade.com President, Jay Lee and will provide a corporate update on the company's activities. The company welcomes questions from the investment community, which may be sent via email to info@midastrade.com no later than Wednesday, October 18, 2006.
The business of MidasTrade and its wholly owned subsidiary Midas Securities has always centered on providing the Korean marketplace access to the U.S. stock and futures markets. In the last year, the company has expanded its business with the addition of U.S. access to Korean markets. This conference call will allow investors and shareholders to listen to a live update by Mr. Lee on company progress and its business plan for both Korea and the United States.
To join the Conference Call simply log on at www.vcall.com/IC/CEpage.asp?ID=110234 or call toll free 888-406-0474 or international dial in call (804)327-8491.

Acetrader bought MIDS back in August and we now own 8,700 shares at an average cost of $1.37/share. If I get a better feel for this, I will be buying more. Until then, let's hear what the management has to say on the 23rd of this month. It could bring on a positive news. Let me just tell you this:
Back in November 2004, MIDS went from $2.20 to $4.50 then during September 2005, MIDS went from $1.97 to $4.70 and during this June 2006, it went from $1.66 to $2.55. Do you see what I see? Any positive news will rocket this stock up quite a bit. And this time it will be different. MIDS will actually start to make money instead of mearly setting things up. Every portfolio needs a potential home run stock. In our portfolio, IDWD and MIDS fills this need. MIDS is second riskiest stock in our group. You decide.

Quick updates

My chemo injection ended yesterday. After three days of non-stop chemo action, I am sometimes too tired to do anything. Yesterday and today was such days. So, excuse me until I feel better and I will be short and to the point.

As you can see, the market is on fire!
I am afraid that it is too much too soon but who's complaining? Just like our "Big Picture" story (please refer to our "Big Picture" notes), 4th quarter of 2006 will be nothing but excitement! Let's get to the juicy news first:

RICK: Damm near all time high. RICK just acquired a new 22,000sq. club in Austin, Texas (51% stake) for about $1.5 million dollars ($500,000 cash and 125,000 RICK shares). This is a great deal! Now RICK owns and operates 13 gentlemen's clubs. It is doing just what it should be doing. One of my favorite stock.

IGLD: Today, this stock hit a 52 week high! And this is going higher. Many of you bought this near $4's. Congratulations! I will write about this one soon. Don't chase it, market will take a breather I think.

IDWD: I know this is speculative but what a story! Anyone who can read, please read the latest news on this baby. It is exciting. Too many people think this story is fake. I can not confirm it personally but I am placing a wager on this. You decide for yourself.

EXPEZ: Slowly but surely, this is creeping up. It closed today at $6.30/share, most of us bought this in the $4's. Yeh! Do not worry about nay sayers out there. Keep buying, period. We will sell this in the $10's OK?

UTK: Anyone who do not own this: shame on you! Buy it now. My top three favorite holdings.

I have been "short" QQQQ last few days (for my trading account). So far, it looks like I am wrong on this. I will be holding this position for the next few days. Let's see.

P.S: This is not the time to chase a stock. Everyone is excited now about the Dow hitting new highs everyday. Wait for better prices unless I told you to get in now (like UTK). Tired already....

Gift: open the box

It was the worst day at the hospital.
I arrived at Memorial Sloan just before 9 am. Quick blood test by 9:45. Then I had to wait until about 4 pm to strat my chemo injection. Most of you know the doctor had to delay my chemo for a week due to terrible sore mouth I had to deal with. Anyway, waiting for something all day takes a hugh amount of mojo out of you.

I don't feel too sexy right now.
Once again, most of you should know that I generally feel "too sexy for my shirt". I could not sleep well; the time now is about 3 am. But don't worry, by dawn, I will be back to myself again - feeling too sexy to be alive yet another day : )
The truth is that my life is full of excitement due to my condition. Let me offer you an example: I just saw the new movie "The Departed" (excellent movie - I am going to see it once more - I am thinking of several Oscars with this one) and I just suddenly felt how lucky I am living in this fabulous country, safe and orderly, ice cream in one hand, in the dead middle of afternoon, watching such a fantastic performance by people I enjoy (let me name these guys: Jack Nicholson, Matt Damon, Mark Wahlberg, Leonardo DiCaprio and it was directed by a legend, Martin Scorsese).

Gentlemen, you don't get much better than this. Right now, people are dying (being killed) in Sudan, Iraq, Afganistan, North Korea and many other places. Whether you like to admit it or not, these are our brothers and sisters. Far related but never the less RELATED. I just hear people complaining all around me. The egg was not cooked right, the movie don't start until one hour later, that car is going too slow, the temperature is a bit too cold, I need a new car, my girl friend is ugly, my boy friend is gay, my boss is an asshole, my brother is a moron and so on and so on. Do you know what I mean? One day (when I get out of this) I will have to thank god for what he/she had given me - an ability to see good things in life, an ability for me to enjoy every single day, making me realize that I don't have the time to be upset.

You know what? God gave you the same gift too.
Some of you simply forgot to open it yet. I suggest you open it soon. I know people who have lost the BOX.

MATK: Didn't I tell you a few days ago that a new revenue source will emerge? And that will make this stock to move? MATK went up as high as $24.73 (+12%) but it closed at $23.69 (+7%). Guess what, there will be more , larger food deals coming soon. Buy it and hold it please!

IDWD: In my last note, I said that there better be some good news regarding this company and that it is testing my patience. Well, someone heard my talk. There was a good news on Monday. The company said that the buyout at $2.35 will occur soon (check the news yourself at Yahoo.com/fanance). Some investors think IDWD is lying (hence the $0.87 price now), I however am willing to wager, I just bought another 5,000 shares at $0.85 per share. Thank god I had plenty of time waiting in the hospital and that they have several computers for my use. This brings my holdings to 20,000 shares and my average cost is now $0.756 - just remember that this is the riskiest stock we own. It's going to be a homerun or you're out!

Yes, I have said that the bull market is here and now. Please understand that day-traders do not add "value" to a stock fundamentally. However, they serve an important role of a "market maker" adding much needed liquidity to the market. Common stocks of a public company is more valuable than a private company stock of equal value. Why? Due to instant liquidity. It is called the "liquidity premium". Day-traders buy and sell in an instant. We can be in a bull market (long term) and have traders be shorting (short term). I am currently shorting QQQQ now (next few days only no matter what). This is why I have separate investment account (long term) and trading account (short term). It is now 4:13 am. Let me try to get some sleep.
Chemo sucks.
Take care of yourself (be happy).

Expand your lungs: RICK

Did you have a good weekend?
As usual, I enjoyed a beautiful weekend myself. I went hiking in the mountain yesterday (cancer cells hate fresh oxygen you know) and also visited my brother at his work site. May I suggest you try to control your breathing at least once a day (takes about 5 minutes). What you are trying to accomplish here is to teach your lungs to take in deep breaths (thus more oxygen intake). Did you know that if you deprive cells in your body of oxygen, those cells are much more prone to turn cancerous? People who do not regularly excercise, utilize only 50% of your lung capacity. Just think of your lungs as a giant filter for your body (by the way, the liver is filter for your blood). Learn to slowly breath in deeply (as deep as you can) and let it out in a similar tempo. Repeat this for a few minutes and your body will appreciate what you just did.

In addition to taking in more oxygen, you are letting out bad (harmful) chemicals out of your system. Just know that your body produces many types of bad chemicals while digesting, fighting germs and reparing your body. The only way of letting these out is by breathing out those harmful gases. Just breath in deeply once in a while: expand your lung capacity.

The market seems to be overbought.
I am obviously bullish on the market in general but I also think that it will have to rest before resuming its uptrend. This week, many investors will try to take profits. Techs and financials look poised to go down a bit. However, let's not get confused. WE ARE OFFICIALLY IN A BULL MARKET NOW. Stocks will move much higher in the coming months. We need to be fully invested. Traders will take profits or go short.

RICK: After good news, RICK always go down a bit before going back up. This happends because shareholders base is not deep enough. Nothing to worry about. In fact, if you are a buyer, you need to welcome these events. As I have said before, I expect September quarter to be a record quarter. Get in before this moves away from ya for good.

IDWD: There better be some sort of news this week (I mean good news). It is testing my patience. You know, I am generally a very patient guy. Let's see.

AUTO: Guess what, this looks to be moving up a bit.

I will be receiving my chemo therapy tomorrow.
Good luck with your buying this week. I have more buying orders for BTYH (I will stop at 40,000 shares). Teach your lungs to take deep breaths. Chow.

Patience: RICK/XMSR/EXPEZ

Patience is virtue.
As most of you know, I am an Asian-American. Growing up in america under american education system, it was quite easy for me to excell in various subjects. I was even a captain of my high school archery team. Yes, we had an archery team. One of the basic aspect of asian culture is learning to be patient. We (excluding those who were born here where they do not have asian cultures) do not talk back to elders (parents, teachers or for that matter anyone who are older than us) and we try our best to listen to the rules. We do our homeworks in time, study when we are told and generally follow the rules of our homes, schools and societies. As you know, it takes fair amount of patience to accomplish all of the above.

Why do I bring this subject matter? Because I would like to remind you of what we are trying to accomplish here. Here are bullet points ( I love bullet points):

1. Investing has no time limit. Most of us will still be investing until we are in a deathbed (we need to leave some $ for our kids and loved ones).

2. When we buy a stock, we try to own it for at least 1-2 years. Actually, I wish we never sell.

3. We only sell a stock if a. price jumps to our target price quickly b. business sours c. better opportunities for our dollars elsewhere.

4. Daily price movements should not bother us. That's the nature of the stock market. It goes up and it goes down. Generally, it goes up more than it goes down on average.

5. When things look and feel bad, you can get things for better price. If you like something, chances are other people like them too - this never results in good prices.

Please digest above facts. Stop being too emotional.
Be patient.
Now, here are relevant info regarding our holdings:

RICK: The third quarter (ending 9/30) results should be another record breaking quarter. September sales were 40% better than last year. Tomorrow, the stock might go above $9 for the first time! Now, you know why this is our largest holding.

XMSR: During the third quarter, XM only signed on 288,000 new subscribers. So, as of 9/30/2006 XM has 7.2 million subscribers vs. SIRI's 5.1 million. XM is expecting to add another 500,000 new subscribers during this last quarter to end the year at 7.7 - 8.0 million. Let's do the quick math: 8 million people x $12.95/mo fee = $103 million dollars per month revenue. Another words, $1.2 billion per year! Yes, that was billion with a "B". Just buy this now at current price OK? Do not listen to others who thinks this company will go under ( this is why XM is at $11 instead of $21). Re-read my XMSR writeup a few days ago. I will be buying more if it falls more (my cost now is at $11.20/share). I wish this goes under $10! So should you.

EXPEZ: This is a warrant. Warrant acts like a long-term call option on a stock. The warrants are used to "sweeten" the package when companies try to raise money by issuing stocks. So, companies offer warrants in addition to the stocks when selling shares. EXPEZ is a warrant that gives the holder "a right" to buy Expedia stock for "$11.56" until "2/4/2009". Warrants have two (2) values: Intrinsic value + Time value. The current intrinsic value for EXPEZ is $4.49 ($16.05 EXPE price-$11.56 contract excercise price) thus the time value is only $1.51 ($6 EXPEZ price - $4.49 intrinsic value). Bottom line: EXPEZ is too cheap! You are only paying about $1 for the right to buy EXPE stock for $11.56 anytime until February 2009! God only knows how much Expedia stock will be worth in 2009, but for EXPEZ holders, we only have to pay $11.56! Do you get it now? (most people do not). Buy this now - I mean now. Please refer to my past article dated 5/25 and 7/13 and 7/14 for more info.

IGLD: I will write about Internet Gold in detail later. For now, just know that I am moving this one up into the same group as the RICK/UTK/MATK (we may never sell). The business is fabulous. They are growing nicely. Some people agree with me, the stock is up over 50% during the last 2 months. It will go higher. Double digits in a year - that's my call.

BTYH: I just bought 10,100 share more today at $0.62 per share (Acetrader now owns 30,100 shares). I will be buying more if this falls to $0.59 - wish me luck.

OK, I am officially tired. See ya tomorrow.

Big Picture V: updates

First trading day of October 2006.
We have now officially entered the 4th quarter of this year. It's time to revisit my usual "Big Picture" segments in order for us to get ready for the last ride. Here's my take on the investment environment today:

1. Stocks: we will see new highs for this year during 4th Q.

2. Interest rates: Definately no change before and probably no change after the election season (November). So, rate movements will not hurt us (Bernanke talk might).

3. Election: Republicans will keep the Senate; Congress is a toss up. Republican control will enable Mr. Bush to finish the job ( like it or not, this bull market is a direct result of Mr. Bush's economic policy of low taxes).

4. Gold/Oil: Commodities such as gold and oil has lost its mojo. Most are hitting new 52week lows. Did you know that the best time to buy gold stock is in the 4th quarter? This winter, we might finally buy into gold related issues. Stay away from these fr now.

5. Bonds: Who cares? Rates probably will come down early next year. Not a bad investment if you are looking for 5% annual returns.

And what about our portfoilios?
I will do you a favor by placing our stocks into different catagories:

* Buy now and hopefully never sell unless: RICK / UTK / MATK (be patient with these, do not try to trade these either. You must own these if you are a long term investor: our core)

* Buy now and sell it when price target is reached: XMSR / NTE / IGLD / EXPEZ (on every Performance updates, price targets are updated)

* Potential home run or we will sell it: MIDS / IDWD (you never know with these guys)

* Down but not out - double down please: BTYH (buy more near $0.60's)

* Testing my patience - near sell but not yet: AUTO (do not sell unless it closes near $0.90- $0.95 area: this has potential to jump toward $2 in a heart beat).

That's all folks.
How do you like my presentation? Did this help?
Good luck in October!

Why Acetrader?

Originally intended for friends and families (and mostly for myself), Acetrader was designed to educate and communicate with people close to me and my family. Somehow the community grew to a few hundred within the last few months. As long as we learn and respect each other, I guess I see no harm in sharing information with "strangers". You will not be considered a "stranger" as long as you introduce yourself to us (through the comment section). I have had many pleasures in meeting like minded people through this blog. In fact, some have came and met with me in person (we went out, dined together and even went on hiking together for some). Please try to introduce yourself when you send me a comment for the first time (your name & where you are from is sufficient). I like to have some feeling when sending your answers. Thanks.

I like to offer my sincere gratitude to those who have prayed for me. Although I truly believe I might be the top few percent of people who may survive (defined as living 5 or more years) stage IV colon cancer, the real statistics show that over 90% die within the first five years with average survival time of about 9.5 months. Since my surgery was back in November 2005, I have offically passed the "average" survival time by 2 months! Yeh!
Yes, I am still ticking and feeling awsome.

So, in the mean time, why follow Acetrader?
Does it offer value; enough to spend about 10 minutes of your time logging in and read? Well you decide. My goal isn't to increase traffic to my site (notice I do not have google ads?). My goal is to touch someone that may be helped by my efforts. It would give me pleasure in knowing that I am helping someone. Being financially independent, should be the goal of every man and women. It is very difficult to help others when you are in need of help yourself. I also have noticed that people who are financially comfortable have more compassion toward others. Basically, they can afford it. Time, compassion, energy, will power, creativity are all connected to MONEY.

Do you know what is the biggest challenge in stock investing is?
#1. When the stock price moves up, is it time to sell or buy?
#2. When the stock goes down, is it time to load up or dump it?

Well, that's why you might want to read Acetrader.
Case in point #1: when we bought PRZ near $1 and it quickly moved near $2 within two months, I advised you to sell. It is now at $1.37
Case in point #2: our worst performer BTYH is down from $1.46 (our cost) to current $0.63/sh. I just told you (yesterday) that I am adding more at these levels (meaning - buy). How much clearer can you get?
Case in point #3: Our top holding RICK went from $4.80 (our cost) to current $8.14 in just over 6 months. What to do? I said this many times, RICK will trade in double digits soon (meaning - buy). Why would I still own 5,250 shares (which is much bigger than my usual unit) if I thought that it is fairly or over valued? Take a hint: this is our largest holding still.

The best way to follow Acetrader:
1. Decide on your unit size for one stock (Minimum should be at least $2,000 due to trading costs)
2. Among the stocks in our portfolio, pick your first few until you have all the stocks (diversify I say; but do not over diversify 12-15 is more than enough).
3. Print and Read previous notes ( this will ensure that we are on the same page)
4. Ask questions and share ideas with us.
5. Go to #1 and increase the unit size (our unit size is about 15-20K).

Answers to yesterday's questions in comment section:
1. I have no idea what "Iners" means. Please re-send.
2. QID is not illiquid for most of us. For my trading account, I trade between 1,000-3,000 shares. The average volume of QID is over 1.3 million shares per day. This is more than enough for small investors like us. We simply do not engage in "futures" period. LEAPS are more expensive than ETFs (bid/ask spread) and besides, my average time in QID is less than two days. One do not get into LEAPS for a day or two.
3. IDWD is a speculative hold. Remember, as I have said many times, this is the most risky stock we own. Having said that, we have made serious money on IDWD, moving in and out. Please read all the recent news regarding the stock. There are simply too many good things going on with this company right now. Let's give the management another week so so.
4. Jo: How are you?
5. Please go back and read my analysis on XMSR. This is a "buy" right now.

Let's get one thing clear: I will not sell or buy anything without letting you know ASAP. With some exceptions, I write almost every trading day. You will know if I thought XMSR is no good anymore. Although things can change overnight, they rarely do. Buy means buy until I say otherwise. Do not listen to too many people or news. Pick your advisors (quarterbacks) and stick with them until you feel he/she is wrong for you. Trust someone.

Bad Toys: BTYH

So, I have been on pain medication for a week now.
I am basically on a liquid only diet (too much pain to chew). Drinking water is a pianful process believe it or not. But it is getting better - I should be back to "normal" by next week. As soon as I can chew and eat food, I am getting me a juicy steak & a big lobster. There is a famous steak house called " Uncle Jack's" near my house (rated five star I mind you). They know steaks. I prefer T-bone to a filet and I have to have creamed-spinich. I also prefer mashed sweet potato to a regular potato. Coffee is my favorite drink. And I always have some kind of desert. Hopefully, this will help you to know what & how I like my steaks. Hint. Hint.

The market will be taking a breather next week. It will not affect our investment portfolios all that much but for active traders, next week will present some quick trading opportunities. Volatility will return in a big way. The basic thesis has not changed: keep adding to our holdings for higher prices later.

BTYH: This has been our worst performer in the portfolio thus far. Over this weekend, I had to decide whether to hold or sell Bad Toys Holdings. Went over the financials and various news and technicals regarding this stock. And I have came down with a final conclusion: I am buying more at this price. At around $0.60 per share, it represents value. It can easily double within a year. My rules are simple: if I find an investment with potential "double" within 2-3 years, it is a buy. If it has potential to double in a year or two then, it is a "must buy". BTYH is a "must buy" then. This stock is falling because it desparately needs to refinance its debt holdings. These debts were incurred in aquiring the ambulartory business. Because this is a small company ($14 million market cap now) it is having some difficulties in getting loans with decent terms. But this will be done eventually one way or another. BTYH can always seek private financing using equity but the CEO does not wish to dilute shares using equity at these low levels (smart). Remember that the CEO, Mr. Nunan owns over a third of the company (over 8,000,000 shares) while receiving less than $80K in salary annually. So here is my final analysis:

1. I am willing to bet that Mr. Nunan will do whatever necessary to get this financing done.
2. This is a company with over $45,000,000 in sales
3. It is very profitable with EPS of $0.22/share
4. Current PE ratio is 3 (can you believe it?)
5. Shareholders equity has been going up every quarter
6. Once financing is complete, it will split into two companies
7. Worst case: the company will be sold at higher price than now
8. POSITIVE cash flow every quarter!
9. Technically, it is near the bottom.

Bottom line: I will be buying (currently Acetrader owns 20,000 shares) 10-20k shares next week to average down my cost. I will let you know when the trade excutes.

For my trading account, I have fully accumulated JNPR short position as of last Friday. I now carry 5,000 short JNPR at $17.31 and 800 of QID shares. Monday will be interesting....
Both of the above positions will be cleared within the next week. I will keep you informed.

P.S: Did you all see RICK move on Friday?