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Strategies & Market Trends : Value Investing

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To: - with a K who wrote (23631)	3/23/2006 6:19:07 PM
From: E_K_S	of 78702

Hi with a K - I have seen no forecast for rates to rise but you really can not forecast this with any accuracy. I am looking at the long term trend with this investment and trying to accumulate a position at some reasonable "value" price. I am learning fast that this is a sector that is very price sensitive to the day rates and if your ships do not have a lot of long term leases it can be a wild ride. I hope it will work the same way when day rates move higher. DRYS only has about 40% of their ships locked in with long term contracts 24 months or more. Therefore they are subject to these wild swings in price as day rates change. The only positive thing is you do receive a pretty good dividend. I like your idea of buying a basket of these companies to help diversify specific company risk. EXM looks interesting and may have good value too. At least we are buying at the lows w/ PE's below 3. It's hard to know when they will turn the corner but it will eventually happen as long as they have enough cash to stay in operation. DRYS new credit facility will make this happen. EKS

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