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.
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.
posted by Jaewoo | 8:40 PM
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