January Effect 2006 Message Board

STOCKTALK

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Strategies & Market Trends : January Effect 2006

IWM 262.16

+1.0%

4:00 PM EST

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To: Q. who wrote (11)	12/28/2005 11:24:08 PM
From: RockyBalboa	Read Replies (1) of 79

Speaking of YAKC this one looks definitely interesting. Somehow, I omitted HRT and also DVW not because they are amex stocks but perhaps of stock price and weak balance sheet. Some of my picks are doing well; also I see the med-design company (MEDC) coming back to life. Todays specials included Vesta (VTA) which traded very low afterhours with fills as low as 56c. Some of my picks continue to trade lower, including ECR; which seems to be in a less favoured spot (it is a subprime mortgage lender; Firstplus, UC, FACO come to my mind). Nonetheless the stock recently paid a dividend of 0.18; reflecting a yield of nearly 30%. I'll likely keep it until it declares a cut or suspension of the dividend. If someone has an idea how to borrow UALAQ I would be thankful. Its stock price and price differential to superior instruments (like the 2 classes of UAL preferreds) is simply off the chart. A word on bond yields; the curve has inverted with 10 years below 4.40 and the March Eurodollar at a sturdy 4.75% wiping off several trading positions which aimed at a normalising yield curve; all that happens close to the end of year right into the face of a good consumer confidence number. Many observers point out that sellers want to see levels tested before selling begins in earnest, and it is window dressing time; no one is getting into the way right now. I have bought my (bear) positions across the curve today. For the patient guys, volatility is often returning close to the expiry of the current contract latest but this time it should not take that long. (Ed: If by magic, the fed is about to pass some rate hike until March the Eurodollar will not settle at 4.75; but currently the contract is not moving at all implying little change in politics. If the slowing down had some merit, the short term contract would be an obvious buy).

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