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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: mishedlo who wrote (22228)	1/26/2005 2:05:02 PM
From: Haim R. Branisteanu	Respond to of 116555

Recommendation – Dec 28th 2004 - One month later The following investment recommendation was given on Dec. 28th 2004. (see SI post)Company - Braskem S.A. ----------------------------------------------------- Short BAK on the NYSE – average price $50 to $51 (Dec 29th / 31st ) Buy BAK 2007 debentures in Brazilian Real @ 18.5% interest rate Sell Call EUR / Put Real @ 3.666 BRL /EUR – Now BRL /EUR is 3.4881 Selling a 2 month Real Put option @FX 3.60 would have been 4.75% FX Real/USD = 2.6952 - now 2.664 On January 3rd there was a $0.839 dividend to pay as such BAK average price would be $49.5 --------------------------------------------------------- Gains on Short BAK 13.5% (present price around $43) Gains on BAK Debentures 2.5% (interest + $ FX gains) Gain on Real Put Option 4.1% (present BRL/EUR Put option 0.642% @ FX -3.488) --------------------------------------------------------- Total Investment Gain 20%+ or about $200,000 per $ million