Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : Big Dog's Boom Boom Room -- Ignore unavailable to you. Want to Upgrade?

To: GaAs52 who wrote (66051)	6/16/2006 12:03:04 PM
From: Umunhum	Read Replies (1) \| Respond to of 206316

Mr. Aubrey McClendon needs a prudent financial advisor. Apparently, he finances these purchases with margin using his current CHK stocks as collateral. How can it be sensible when one owns ~25 M shares, with cost basis at low single digits or less, and then goes on margin to increase his position by a percent or so at ten times + of his average cost basis. Averaging up is a practice that is employed by many of the extremely successful traders. Averaging down is a practice that is employed by many bankrupt traders. If you haven’t read these books I highly recommend them: amazon.com With all due respects to Mr. Mclendon and his success at CHK, these purchases are nothing nore than cheap shots to hype the CHK stock price. Or they could be that he believes his stock is worth over $50 a share and the market is only valuing them at $30. I will be a CHK owner when CHK buys ng properties when ng is at 52 week lows, not 52 week highs, and using its cash flow for purchases rather than issuing CHK stock, which was deemed to be extremely undervalued. CHK's business model is an extremely brilliant one. He buys reserves in the ground at $2 and hedges them at $9. After a couple of years of production, the purchases pay for themselves. I highly recommend that you read CHK’s investor presentation. I couldn’t disagree more with everything that you wrote: library.corporate-ir.net