Happy Holidays !

Guys and gals:

This will be my last blog before leaving tomorrow morning to Japan & Korea. Our family (including Ace, my son) will spend three days in Toyko, Japan during Christmas and two weeks in Seoul, Korea. This will be a nice needed vacation for all of us.

I will be back on January 10th, 2007.
Whatever thoughts you have, please leave it in the comment section below. I will try to answer them as frequently as I can. Several stocks (in our portfolio) had given back gains lately and our yearend performance won't be as beautiful as I thought it would be. But I do feel very comfortable with our soilders looking into 2007.

Have a beautiful holiday season and may your family have a happy, healthy New Year! For your information, 2007 is the year of the "Golden Pig". Just know that this is a good karma. 2007 will bring many new, exciting ideas for you and me. Take care ...

P.S: Jo, I use GDX instead of GLD because of the leverage it provides. Although GDX has short history, if gold were to go up (we are in a multi-year gold bull market now, we are just resting a little here) GDX will go up much, much more than gold (vice versa). Similar to EXPE versus EXPEZ. I am constantly looking for leverage on my money (the main reason real estate is considered a good investment is because the leverage it provides - only 10% down). I am not interested in the "physical" gold - gold coin sellers to tell you otherwise : ) Don't listen to them and all the talk about how the world will end soon, dollar will free fall, USA will go under etc etc.
Gus, you have a wonderful holiday too!

RICK: love & hate

I have one grand mother left - on my mother's side.
She is now 84 years old and still semi-active. Yesterday, we moved her into an "assisted living" facility in Long Island. Although I felt that this was a good move for her, seeing her cry made me feel uneasy. The facility was clean, professional staff was on board, serves three meals and snacks everyday. I was happy with everything except that most people in that place had some shades of Alzheimers conditions.

My granma's new roommate for instance (she says she was 82) asked us who we were about 5 times. She was like a fish. One quick turn and forgets the whole thing. Do you know why fishes can survive in a small fish bowl? Because after a quick turn, it thinks it is swimming in a new water. The fish bowl seem like an ocean to them. A new place to swim every time.

RICK just made a move yesterday: up 8% on a low volume.
Hopefully this marks the end of selling that started in mid October. The 4th quarter and year-end earnings will be released on December 28th. Investors will try to buy the stock prior to the announcement. That leaves us with only three (3) days of buying before the earnings. Let's watch. Remember, we have not sold any of our holdings in RICK yet. In fact, it is still the largest holding in our portfolio.

I know that some of you were getting worried about RICK. I mean it did had a 35-40% drop between October - December period. It was easier for me to handle this because our cost was $4.80/share. Many of you have much higher cost. For those of you, this should be a welcome time. A time to buy RICK on the cheap. The problem with most investors is that they do not understand the value of holdings.

People only look at the price they bought versus the price now.
If it happens to be higher - they are happy and feel smart.
If it happens to be lower - they get upset and try to sell.
I have no patience for such dumb people. These kinds of people should not be investing in individual stocks. They should buy mutual funds - managed by active human managers. These people should not even buy ETFs (exchange traded funds - which I prefer to mutual funds).

One person had told me "RICK is such a bullshit, low quality company that it fell 35% in such a short time, and for no good reason - I'm selling" ( by the way, RICK was $5.20 when he/she said that). Smart move, oh great one.

The truth is that RICK is not a proven, quality player yet. But then, you all knew that. This company basically buys and manages "strip clubs" (quality ones though). Not a rocket science. Still too small for the big wall street boys to enter this game (excellent!). The reason I liked RICK: 1. the CEO's vision made sense to me. 2. the price was fair. 3. business was simple. Unless there are information I am not aware of (non-public info.), I feel that the business is sound. Let's confirm it on Dec. 28th with all the pertinent financial numbers.

Just so you know, 40% price move up or down is quite "normal" for stocks in our universe. Here's an example: Do you think Apple (AAPL) is a quality company?
Let's look at the price move of Apple in 2006:

January 2006: $86.50
June 2006: $50.16
November 2006: $93.15
Today: $83.05

The move Apple made between Jan-Jun 06' is ( - 42%) then Jun-Nov 06 ( +82%) now back down to $83. Such is a life of stock investor. You now know that 40%+ moves are not only reserved for small, unproven companies. Apple with the iPod does the same thing.

Human emotion is not predictable.
One day RICK is your love, the next it is a bitch.
I am sticking with my love just a little longer until I find out the truth. The truth will be told on December 28th 2006. Merry Christmas!

Comments from you

Comment #1:
You mention that over the long term stocks produce the best returns over cash, bonds and real estate. Stocks(even the lesser known names that you buy)have better liquidity than real estate. Just look at all the "for sale" signs out there! I was also wondering what you thought about shorting GROW. - Anonymous.

Reply: U.S. Global Investors, Inc. (GROW - what a great symbol) through its wholly owned subsidiaries, provides mutual fund management services. It provides investment advisory services to institutions and individuals. First of all, this is a great business to be in right now. Although price went up quickly during the last few months, and this does look over-extended (what isn't these days), I would not reccommend shorting this one. The risk/reward ratio is not good enough. At any time, a bigger money management company can easily step up and offer to buy this one. No debt, over 5X current ratio, over 50% return on assets and equity is too juicy for bigger guys. When market falls, this will too but you have so much better shorts to go after. Let's not mess with the good stock in the right business. For shorting ideas, look below.
P.S: Give at least your first name next time.

Comment #2:
Goldman Sachs ups the 12-month price target of BIDU to $128 today. Do you think it is still a good short target? How about its Jan115 puts? I also like the AXR short and can not find any shares available.-Dennis

Reply: Dennis - thank you for sharing the information with the rest of us. Although I knew this already, other readers may not have. I read a lot and I can not share all the pertinent ideas with you. So here goes my thoughts.
BIDU: Basically, Baidu.com is the Google (GOOG) of China. Sounds great so far. Due to the initial success, many investors are flocking into this company. BIDU is already trying to mimic their success in Japan as well. But people are blindly pouring money into this without thinking. See if you agree with me if I lay the big picture for you like this:
1. With all the success, this company has only $88 million in revenue
2. Current market value stands at $4 Billion dollars - what?
3. Forward PE of 67X ( compare this to Google forward PE of 34X)
4. By the way, Google is not cheap either.
5. They are moving into Japanese market (this will cost money - a lot)
6. Japan will not lay still or bend over for BIDU
7. The Real bad news - Google just arrived in China!
8. Google is hiring the best talent in China (few hundred top ones already)
9. If you were a hot engineer in China, would you work for GOOG or BIDU?
10. BIDU should worry about China, never mind Japan.
11. I will maybe (maybe) consider this at 50% off - no less
12. Now what do you think? Yes, I thought so.
Lastly, using an option is a great idea (however, Acetrader will not utilize options). If you are buying the puts, do not buy Jan. contract. Buy at least a Jun. contract at lower excerise price. I will not go into details but trust me - I have extensive experience with naked options.

AXR: This is simply too pricy. I have no idea why. This is another 50% off candidate. I will not bother with an analysis on this one. I would short this.

P.S: As per my previous blog, I have this funny feeling that the market has not hit the top yet. (we just sold our QID remember?) Which means that both BIDU and AXR might go up further from here. I would wait until the down turn is more obvious before shorting either one. I am assuming that you are not a day trader. For day traders, every day is a potential short day. By following my blog, you will see when I turn decisively negative (when I buy QID back). Do not chase just yet - Dennis ...

PPS: Dear Readers - does this kind of Q & A help you guys? Comments please...

My vacation schedule

This is a good time for me to share my vacation schedule with all of you. Due to the chemo injection in me right now (pretty big needle I must say), I am not in the best of conditions (actually, it is kind of amazing that I am even up and typing at this point). But after telling you what I will be doing, hopefully I will feel much better.

My family will be leaving USA on December 24th (X-mas eve) to the "Land of Rising Sun" (Japan). We will be spending christmas in Toyko (I gotta see this) eating sashimi while watching Japanese Santa on the street. The first Santa my son "Ace" will be experiencing in his life will be a "Japanese" Santa. Great.

We will then fly over to the "Land of Morning Calm" (Korea) and stay there until January 9th. By the way, I mean the South, not North Korea OK? So many dumb (yes, stupid because half of them don't even know where Korea is on the map - so much for American education) people ask me that I have to clearify each time. Just so you know, the North Koreans are not allowed to enter USA. They do not have any diplomatic relations with the U.S.

We (Americans - yes, I am an American citizen) do not like to be friends with any country that wishes to have "Nuclear Bombs" like North Korea. But wait! The Chinese have nuclear bombs, so do India, Russia, Israel, England and even the French have them. Hmmmm, what's wrong with this picture ...

Bottom Line: I will be away from December 24th - January 10th.
I will do my best to keep up with the blog but please understand if I skip it for a few days. You have a wonderful, healthy, happy holiday season as well.

P.S: Within the next 2 weeks, both RICK and PRZ will experience big swings. It could be to the upside (I think) or it could be to the downside (smaller risk). Prepare and adjust your holdings accordingly - if you know what I mean.

Enjoy the ride

I hope you all had a great weekend.
As usual, we had several guests over the weekend and also I spent quality time with my son "Ace" and my family. Tomorrow (Monday) being my scheduled chemo day, I am already feeling somewhat sick everywhere. Human body is truly amazing. I see no reason for me to feel this way except that I am not looking forward to tomorrow (besides chemo, I will be away from studying the market). Well, as I always say, "You can't have everything".

As per my previous blog, I have sold QID at $15.49 on Friday. Until recently, I felt that we have reached the high (QQQQ) for 2006 already (Nov. 22nd). The stock behavior of late, made me rethink my outlook. I feel that QQQQ has a good chance of making new highs before year end. Obviously, if I think this, I should not be holding QID at this time. Bottom line: Acetrader has sold QID for a small profit. We are still holding GDX - continue holding GDX.

As we are coming to the close of this year, I will be writing about various mistakes we have made this year. Although hindsight is always 20/20, I have made several mistakes that I really should not have. Remenber the main 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 enjoying the ride so far - are you?

P.S: I have not sold MATK yet. The highest price on Friday was $24.44/share. I really should not penny pinch here but I will be selling it soon.

QID: Watch carefully

The market made a strong move yesterday.
It looks like this will continue today (it is 8:30am now).
This obviously extended market just does not want to quit. On a closing basis, QQQQ made a one year high on November 22nd at $44.73/share. If the QQQQ moves above this number, I have no choice but to call it a short term bullish pattern. To be sure, I believe we are near the short term top. But near does not mean we are at the top.

Bottom line: There are still a lot of money in the street chasing stocks for the last minute gains. Our economy in general, is in good shape. The inflation is low and stable. The companies are in much better shape (financially) now than ever. Although stock prices are extended, it can easily get more extended. Acetrader followers: Sell QID if it hits our buy price of $51 or if QQQQ hits $44.73 which ever hits first for no loss trade. For the traders, look at the QQQQ numbers and react quickly as I have explained (QID & QLD).

Sell MATK near $25.

Two days ago, I have written about MATK and in it, I have expressed some caution regarding the future of Martek. I have thought about it and this is my opinion:

1. Long-term prospect for the MATK business is valid.
2. Infant formula is 90% of the revenue and it did not grow.
3. Much anticipated "food" deals did not occur.
4. Food products represent less than 2% of revenue.
5. Recent quarterly EPS of 12 cents did not impress me.
6. Restructuring charge will impact 1Q of 2007 business.
7. Next quarter estimated EPS is only 11-14cents per share.
8. During the conference call, the new CEO did not impress me either
9. Management does not have any "deals" they are willing to share
10. Today the stock price went down - this is not a good sign
11. I am quickly loosing interest in this management.

Bottom line: I see the potential to high 20's. I do not see a major down side either. But until a "major" food deal is signed, this stock is going nowhere soon. I am taking my chips else where until I hear better news from the company. Sell MATK near $25 (even this might be a chellenge). The next few days, MATK will swing wildly. Sell it near $25. Let's look for something else.

I am not feeling too hot right now.
Let me keep this one short. Good night...

Enjoy the gift

I live in a nice gated condominium complex in Bayside, New York. I must admit that I am very lucky to live in such a wonderful surroundings. From my bedroom window, I have the view of a beautifully lighted bridge as well as the view of an ocean (this view is worth between $50K-$100K in market value). The ocean side is less than 10 minute walk from my door.

I have the luxury of breathing the clean air (sea side) and drinking clean water (Culligan H2O filter). There is a brand new luxury bus right in front of our condo that goes stright into the heart of Manhattan ($5). I have the HD TV with video-on demand service in my bedroom and the living room. By the way, I have a good sized bedroom since we converted two bedrooms into one. One corner of my bedroom is my office - fully functional with Human-touch massage chair.

Let me put it to you this way, my morning commute is about 2 minutes (if I jump, I can make it in 3 seconds). So why am I telling you all this? First, I think many people enjoy looking into other people's lives - it is somewhat entertaining. Second, I want all of you to know that I am very happy with my life eventhough I am going through one of the most difficult chellenges anyone can endure (cancer is no joke).

I constantly receive many warm wishes from my "fans". I just want them to know that I am doing just fine. But don't get me wrong, I do need your encouragement from time to time (sometimes I cry by myself until I am too tired). I have never experienced "depression" in my whole life - including now. For me, it is hard to understand how a person can get "low" (depressed) in this beautiful life. If you can just stop for a second and take a closer look at your world (from a third person's point of view), I am sure you will find numerous things that are just too beautiful.

What did you do to deserve such a wonderful, loving parents? a child? or a lover? Really, what did you do to deserve being born in America instead of Ethiopia or Iraq? Trust me, you will have entire different set of problems if you were simply born in other places (which will make your current problem look like a child's play). I wonder why you were chosen to be so lucky? Why you?

I don't know.
Let's just enjoy the gift.
We have no time to be upset with ourselves or with each other.

Buy RICK now if you haven't yet.
Buy BTYH if you can wait for a while.
Buy MIDS if you dare.
Buy PRZ if you understand what value is.
Buy GDX if you have heard of supply/demand formular.

Don't buy the market at this point. All of the above are special situation issues.

P.S: Here's an info on MIDS from one of our readers:
http://www.allbusiness.com/finance-insurance/1183422-1.html
Thanks Jo.

MATK: earnings good

Now that I can officially say that I have survived one year as a stage 4 colon cancer patient, I feel as though I have achieved something. You should know that many in my shoes did not make it this far. My next hurdle is making it to the end of 2007.

To most of you, this is "like" a reality show.
Actually, this-is-the reality show. I get to produce the second season for all of you. Occational comments from my audience keeps me in check. If you've been a "regular" without sending one single comment to me, shame on you. I am going to repeat this one more time: "How do I get a steak from you if I don't know who you are?" Give yourself up.

MATK just released 4th quarter earnings after the market close. As I have suspected, Martek Biosciences beat the estimated earnings (its about time). Today MATK closed at $23.36 and I think by tomorrow, the price will be close to $25/share. In addition to the shares I own in the Acetrader portfolio, I have just bought 1,000 shares in my trading account hoping that earnings would be good. I think I got it. I will be selling my trading shares tomorrow for a quick profit.

I am loosing my interest in MATK recently. Depends on how it reacts tomorrow, I might decide to issue a "sell" soon. MATK has been a slow pain in our portfolio. The management have not done their job as smoothly as I expected. In addition, I have just learned that a Korean company found DHA substitute in eggs. I will advise you more later. In the mean time, enjoy the ride.

P.S: We have sold STMP as per my last blog at $15.25/share for a small gain. I do enjoy a good fight but I do not particularly wish to fight with the U.S.Postal Services. I am out.

PPS: Our two most speculative holdings IDWD & MIDS will jump up and down with no mercy. Especially during this time (December) these will fluctuate more due to tax selling and such. Just accept the fact that these will move more than 10% on any given day with no reason. If you can not stomach such swings, get out now. One of these two can potentially go to zero. The other, can easily double to make it up though. These are wild.

Market Falls... Sell: STMP at $15.25

Good morning!
It's Monday morning and I got up at 5:00am. I could not go back to sleep. Thoughts were running through my head. What kind of thoughts? I am thinking about the market (come to think of it, I wonder if it is healthy for me to be thinking about the market just as I get up in the morning, hmmm). But then again, this is why you guys come and read my stuff, right? My curse is your gain I hope (no, seriously, I do not think of this as a curse - you know I love what I do). I am just glad that with the technology we have today, I get to share my ideas with you.

Anyway, sitting on my bed at 5:15am (dark outside still), I am visualizing the stock market charts - the future version that is. What will the market do in the next 6 months? More importantly, what will each of our holdings do in the near future? The truth is that if I knew the answer, my life would be boring - very boring. So, to keep my brain stimulated, I run through the various possibilities (it is now near 6:00am). Then I decided to type. So, here it is.

Dow 30 / SP500 / NASDAQ / QQQQ will all fall from here.
This is my prediction. As most of you know, I have been a little uncomfortable with the general market for sometime ( thus the QID in our portfolio for the first time). Of course I could be wrong, but I could be right. You decide.

First, I went into my IRA (401K) and moved all money to: 10% Stock / 45% Bond / 45% Fixed. This is until we get the 10% or so discount that I am expecting from the market. Next, I looked at our portfolio. Two things you should do now:

1. Sell STMP if you have it. I just placed a Sell Limit order at $15.25/share. Since we bought it at $15.08 this will be no loss trade. To cut long story short, I don't like the fact that U.S.Postal Services is getting into the online postage action. I do not want to compete with U.S.P.S. I don't need the headach at this point. Sell.

2. Buy QID. Recently, we have bought QID in our portfolio at $51/share. This is a short term investment. Well, this will act as a hedge against our portfolio (an insurance). My target for this is $59.33/share. If I were you, I would place a sell limit order (GTC: good-till-cancel) as soon as I buy QID.

P.S: I have added more of RICK at $5.69/share on Friday. Technically, RICK looks terrible. Fundamentally, I don't know why this is so weak lately. All the information I can gather says that RICK is cheap at this point. Toward the end of December, RICK will announce yearly financial. I am going to assume that this will be good. Bottom line: Although things do not look all rosy, I am going to stick with RICK. As I have said before, unless things change fundamentally for RICK, I am going to hold this until ...

My bad: EXPEZ = $9.48

Two days ago, we sold our last remaining shares of EXPEZ at $7.72/share. To be sure this represented a gain of over +72% in a few months. I have also made it clear that this was simply a valuation move and that I still liked Expedia. Another words, I wanted to buy it back again at lower price. I thought it was fairly valued. When we first bought it, it was definately undervalued.

Guess what, I was a little early.
Expedia company just announced that it will be buying back 30 million shares of its own shares! (this represents about 10% of the total company). Wait just a minute, - the company is spending about $600 million dollars to buy its own shares? They must really think it is worth much more than the current price. Of course, they could not do this when the price was much, much lower (like when we bought it). In any case, this is a fantastic news for the stock holders. Companies do not spend this kind of money without really knowing what they are doing.

Today EXPEZ price jumped to as high as $9.98/share!
Had we sold it at this price, we would have had over +110% gain on our investment. My bad. I was a little early - two days early. Bottom line: If anyone still holds EXPEZ, try to sell it at near $10/share (let me know if you do - you lucky sons of xxx, you).

By the way, you should hope that I keep making these kinds of "+70% in a few months" mistakes. I'd rather be a little early than a little late any time.

Trust me, I feel worse than any one of you.

But still --- my bad.

P.S: I will write about RICK over the weekend. (just buy it).
PPS: PRZ went as high as $1.20/share today. Do I hear anyone complaining? We bought this a few days ago at $1.01/sh. This is only the beginning.

Just read the title of my last blog - yes, I am this good.

PRZ: ready to takeoff

Our recent buy PainCare (PRZ) looks like it is finally ready to make a move. A few days ago, we picked this up at $1.01/share. In fact, since November 14th, PRZ has traded near $1 every day. I was very patient this time, buying this at such a good price. Oh, you may not know how good a deal this was until sometime later. I have a feeling most of you will thank me for this again !

If you have missed the original buy alert, go back to the (11/28th) blog. Today, I have witnessed a large (100K) block buy order hitting the tape. Someone definately want to acquire PRZ at current price. People who do not understand the true value of this stock were selling and I believe most of the selling has already occured. At this point, any buying pressure will move the price upward.

I believe PRZ will move up nicely into January.
There will be some tax selling pressure in December. (Remember my last note regarding the "January effect"). PainCare is a perfect "January effect" candidate. However, I feel that buying demand will overcome tax selling in this case. Let's see.

If you haven't bought enough, do so now.

Added: MIDS at $0.60/sh Sold: EXPEZ $7.72

If you recall, I have mentioned a few days ago that I predict December to be a wild swing month for stocks. 2006 so far has been a good year for stocks in general and money managers and investors are all trying to finish the year with a bang.

You should also understand the "January effect" that will influence certain stocks in the month of December of every year. Basically, any stock that fell during the year, will fall more in December because investors will want to sell it to realize the tax loss to offset the taxable gains he/she might have. This will artificially pressure stock price to fall without any regard to the value it may represent. Bottom line: Good time to pick up shares (I mean fallen shares) at discount prices.

Regular readers to my blog understand that I carry two (2) speculative stocks in my portfolio. They are IDWD and MIDS. I will comment on both tonight.

1. MIDS: Please refer to my note dated (11/7th) and read what I said. MidasTrade.com is a start up company. There is almost no information available to the general public except for the company website at http://www.midastrade.com/news2006qanda.htm . The company is in the process of hiring a public relations firm to finally start telling their story. As you know, when this happens, prices usually rise. I have done my own homework to find that its business is real, very real. I have personally talked to the principals of the major brokerage house in Korea to confirm that Midas indeed have contracts to do business with them. The firm is actually making money now. Audited financial will be provided sometime in 2007 (soon I hope). Bottom line: this was my gut pick. You simply wager your play money on this. You simply have to trust me on this. I have been slowly accumulating this and today I just added to my shares at $0.60/share. As of today Acetrader owns 30,550 shares of MIDS at $0.896 average cost. If it falls any further, I might buy one last time during December to lower my cost base. I feel that this will show its true colors in 2007. Wager only what you can afford to lose. Good luck.

2. IDWD: This baby made me so much money this year that all the shares I have (15,000 shares) are all from the profits. Prices went up during November because that was the record date for the 995ad.com dividend (spin-off). I think that some investors are selling because they are already qualified to receive the dividend shares even if they sell IDWD shares. For me, I am going to hold my shares until I hear the final news regarding the buyout at $2.35/share. Isn't it amazing that this is trading below $1 when HLS Worldwide already agreed to pay $2.35 for IDWD without the 995ad.com division? I have to witness how this unfolds. Bottom line: I am holding my shares - either a homerun or strike out.

P.S: I have sold my remaining shares of EXPEZ today as per my note yesterday. I sold it in the morning at $7.72/share which gives me a gain of +73.7%. This was a good pick. I will be jumping back in when prices are better. Busy, busy ...

Which one? (CMGI)

This is the afternoon version, the morning note is below, so don't miss it. Allow me to explain the title "which one?". When investing in stocks, you need to be aware of what's out there.
Would you blindly buy the BMW without driving the Mercedes? Would you just buy Coca Cola stock without looking into Pepsi? Would you simply invest your hard earned money in Citibank stock without comparing it to the Bank of America stock? I hope not.

I am cheap when it comes to buying stocks. I am very generous when it comes to food. Let's go back to August 16th, when I first recommended XMSR (go back and read it - oh, that day I wrote both morning and afternoon versions as well). At the time, everyone loved SIRI: how Howard Stern will make a hugh difference in attracting customers to SIRI. My question was this: Yeh, but at what price? I think if you were to add both salary and stock options Howard received, it amounts to close to $1 billion dollars (5 year contract). What? You can have Howard. In any case, Acetrader bought XMSR at $11.20, same time SIRI was at $3.65. Fast forward December 5th. XMSR closed at $14.32 gain of +27.86% during the same period, SIRI closed at $3.85 gain of +5.48%. Now what do you think?

Case $2: When we bought EXPEZ, I saw three choices.
EXPE: $14.00
EXPEW: $1.51
EXPEZ: $4.36
We could have bought any of the three securities (all Expedia company) that day at above prices. Upon my analysis (details are in the past notes) I decided to buy the EXPEZ. And heres what happened as of today:
EXPE: $18.71 gain of +33.64% (not bad at all)
EXPEW: $1.90 gain of +25.83% (still good)
EXPEZ: $7.96 gain of +82.53% (now do you see?)
There are still lazy investors out there who are buying EXPE & EXPEW everyday. Either they do not know about EXPEZ or they don't understand warrants. BTW, if you think Expedia is about to fall, you should not buy any of them (obviously).

The point is this: I am doing these kinds of homework for you guys. In the process, I hope you can become better equiped investor. Knowledge is something no one can take away from you. As I have said before, you will use this skill for the rest of your life. I sincerely hope that you can take away as much as you can before I cease to be able to continue this work. The average stage IV colon cancer patients have already passed away. I am living on bonus times. Every new day is a present from god as far as I am concerned. I am very content with my life right now. My only wish is that I get to see my son "Ace" grow up into adulthood. I love Ace.

1. As per my note this morning, we bought more of CMGI today at $1.42. This brings our average cost to $1.38/share.

2. I will be selling the remaining shares of EXPEZ tomorrow. I believe we can buy this back at cheaper prices. If I were to sell it at $7.95, our gain would be +82.53% in a few months- do we have a problem with that?

P.S: If anyone beat my performance YTD using our stocks, I would love to hear from you. That's the whole point of this anyway. Use the comment section with first names. There's got to be at least one right?

Sold: IGLD @ $12 (+127%) Buy: CMGI

My chemo yesterday knocked me down.
Thank you to those who sent warm messages via comment section. I really do appreciate it, especially when it comes from those who I barely know except through these pages. I feel that I am getting to know some of you, just like you probably feel that you are getting to kow me as a person, investor and as an artist.
Trust me, investing is more art than science.

Important news:

1. Acetrader sold the remaining shares of IGLD at $12. This represents a gain of +126.84% ! I sincerely hope that many of you took this advantage along with me. In fact, most of you should have better results than me, since I have been yelling about IGLD as its price went below my purchase. Some of you bought this in the $4's. My cost was $5.29
Congratulations and let's move on. (I smell many steaks from ya)
Oh, I still love IGLD. We will be buying this baby back later.

2. I finally got the news I was waiting for.
CMGI has turned the corner and is making money! If you remember, I initially bought half my usual unit on this one (at $1.33). Now I am buying the other half unit to make it a full unit in my portfolio. Something tells me that 6 months from now, this price may look ridiculous. CMGI will hit the new 52week (1 year) high price soon. Buy now. (try not to pay more than $1.50)

3. The market will become very volatile in December. Many professional money managers are trying their best to not look stupid when the year is over. Many mutual funds have less than 10% gain for the year so far. They will try to buy and sell in desparate moves to at least equal the market return (no bonus if they fail). In the end, more than half of all money managers will fail to beat the market (and can you believe that investors pay for them?)

P.S: SIRI is in trouable. This will probably affect our XMSR. Let's keep an eye on this tight.

Have a nice day : )

Performance Update 2006

My surgery last Thursday went as smooth as silk.
This time around, I don't even remember when the doctors put me under. The last thing I remember: I was joking around with the doctors while lying on the surgery bed. When I woke up, I was in the recovery room already. Wow! I love these amzing drugs. When I came home, I did have some pain while urinating but as of today the pain has subsided. If you think about it, it is quite amazing what modern medicine can do today. Too bad, that we have no cure for cancer yet. Well, I guess you can't have everything.

Now here is our YTD performance in 2006:

Index NAV (1/1) NAV (12/1) Performance %

SP500 1,248.29 1,396.71 +11.89 %
Nasdaq 2,205.32 2,413.21 +9.43 %
AceTrader 1,315.32 1,874.34 +42.50 %

As noted above, these numbers are as of last Friday (December 1st, 2006). We were up more than +50% not too long ago, but some of our holdings gave back some recently. Not to worry. Even with those mishaps, our performance is in the top 1% of all professional money managers (mutual funds, hedge funds and institutions). And most importantly, this is not a hypothetical portfolio. We use real money! Our current holdings and our cost is listed below.

Stock Avg.Cost Price (12/1/06) Gain/Loss % Target
RICK $4.80 $6.79 +41.46% $10.10
BTYH $1.04 $0.60 -42.31% $2.40
MIDS $1.03 $1.10 +6.80% $2.75
AUTO $1.09 $1.07 -1.83% $2.16
IDWD $0.76 $1.17 +54.35% $2.75
UTK $13.65 $12.53 -8.21% $28.00
QID $51.00 $53.32 +4.55% $57
PRZ $1.01 $1.02 +0.99% $1.90
GDX $40.18 $41.54 +3.38% $48.00
CMGI $1.33 $1.33 +0.00% $2.45
XMSR $12.89 $14.45 +12.10% $22.50
EXPEZ $4.37 $7.57 +73.07% $9.90
STMP $15.08 $15.60 +3.45% $28.00
NTE $14.97 $16.18 +8.08% $22.00
IGLD $5.29 $11.44 +116.26% $12.00
MATK $26.42 $24.29 -8.06% $38.00
HLS - no value yet (special dividend from IDWD)

The stocks are listed by size of holdings. Another words, RICK is my largest holding in our portfolio. You will notice that the size ranking has changed quite a bit from the last update (9/4 th blog). This reflects our various recent sales to lock in profits. It is very important to be diversified in investing.

As you know, I like to keep my holding size to be about a dozen (12) stocks in our portfolio. Currently we have sixteen (16). This is too many. However, this situation won't last too long:
1. The QID holding is for short term only. As soon as it reaches the target of $57, it will be sold, pronto.
2. Sell the rest of your IGLD on Monday. I still like the company but it went up too fast and we have near +120% gain on this stock in a few months. Let's lock in the gain and wait for better entry later.
3. I will look to exit one or more positions in coming weeks.

This is not a time to be aggressive. The market seems to be tired and it looks like it wants to rest. Let's wait for better prices before buying.

P.S: Our final performance update will be at year-end. Although I will be on vacation (from 12/24/2006 - 01/09/2007) I will try to give you the final numbers. Being up +43% YTD is no small feat. Most professional money managers would die to have numbers like ours. Our most recent two buys (QID & GDX) reflect my cautious stand. Both are up nicely in a few days. Let's see how the market unfolds in December. I am very comfortable with our holdings ...