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BP= Bankrupt Petroleum?

  
Analysis, Education, US Market
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Above is the Monthly chart of

It was a bad day for most stocks , but it was a bloodbath for embattled oil giant BP.

Shares of BP dived 16 percent , driving the stock price to below $30 per share, the worst drop on record for the company. The British energy giant closed at $29.20 per share. More ominously, investors and traders rushed to dump their BP: Trading of the stock occurred at four times normal volume today.

As a result, the asset-rich company is now trading for less than its book value, which is essentially all the assets it has — oil fields, oil rigs and so forth — minus intangible assets and liabilities.

In English, this means that investors and traders think that the company is now actually worth less than all the hard assets it owns. That’s a confidence trade.

Today, BP is worth $91.4 billion. In mid-April, the company was worth $180 billion.

BP will be forced into a pre-packaged bankruptcy hit the markets like a torpedo into a well head.

What is interesting is that companies are usually very quick to respond to market rumors. So far BP has been silent and has yet to issue any statements regarding the speculation of a bankruptcy filing.

I have no other information than what is being reported on the wire services. If BP is to make a statement dispelling the speculation they had better do it soon.

 

THE GOLDEN RULE

  
  Education
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aathegoldenrule

10% of your trades will account for 90% of your profits

1 or 2 months will account for most of your annual profits

1 or 2 days will account for most of your monthly profits

Good investors and traders know that very well. They are ready to press extra hard when realize that they might have a home run in play. They are ready to disappear in 60 seconds when things don’t go as planned.

William Bernstein: There Are Two Kinds Of Investors

  
  Education
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There are two kinds of investors, be they large or small: those who don’t know where the market is headed, and those who don’t know that they don’t know. Then again, there is a third type of investor – the investment professional, who indeed knows that he or she doesn’t know, but whose livelihood depends upon appearing to know.”

William Bernstein

HOPE

  
  Education
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While it may sound innocent enough, hope can be the great profit-killer for traders and investors alike. Hope is a dangerous emotion because it can cause irrational thinking. Hope is the reason some traders add to losing positions — because they are convinced they are correct and hope the market will eventually vindicate them. Unfortunately, the market does not operate under these rules. When you’re trading a stock based on technical analysis, the market is always right.

Before every trade you make, you must make a pact with yourself to sell the stock if it fails to do what you anticipated. If hope sneaks into the picture, prepare yourself for larger losses.

Great NEWS :IMF to provide give €10 Billion to Greece

  
Analysis, Economy, Education
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The International Monetary Fund is looking at raising its share of Greece’s financial rescue package by €10bn ($13.2bn) amid fears that the planned €45bn bail-out will fail to prevent the country’s debt crisis from spiralling out of control.

Senior bankers and officials in Washington and Athens told the Financial Times that the IMF was in talks to increase its aid contribution by €10bn. The fund could make that sum available under a planned three-year loan, according to an Athens-based analyst familiar with the talks.

Investors and policy specialists said that expectations of the size of the three-year package in Washington policy circles had increased to at least €70bn. The EU has so far proposed to provide €30bn and the IMF €15bn. “The fund’s current ceiling for Greece is €25bn and the release of the extra amount is under discussion,” the analyst said. The IMF declined to comment on the size of the package.

Dear Readers & Traders ,We are again first in India to give this NEWS.And in afternoon or late by evening once this NEWS will be out.Then watch huge short covering across the Globe.

Technically Yours

ASR Team

Baroda ,India

Women and The Market

  
  Education
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1.) I suggest that one pays attention to the stocks that could care less if they are purchased or traded. The quiet ones. The non volatile ones.(the best, most stable women are thriving and so busy enjoying their lives they don’t really worry about being snagged, they have more men in pursuit than they can usually manage or have time for.) They are the best catches. They don’t dress to necessarily impress or seduce, they don’t have to.

2.) If the idea of competition stirs interest, don’t get seduced, investors might merely be competing with each other when they should be focused on learning about how the market moves and what she needs at the moment. The male or investor might miss something big being divulged or demonstrated when he worries about the competition. The conversation/connection with the woman or the market must be sustained fully.

3.) Men can NEVER be caught. Men fall in love first. If a woman tips her hand in this regard she is done. Men are suspect if something comes too easily. Unless he’s a narcissist and imagines that he is irresistible or invincible. It doesn’t hit him immediately that he has to have her. If a stock gains lots of attention it will probably lose it’s momentum soon and is probably just flirting with you or using you to create competition for the man she truly wants. Real interest from a woman is steady and climbs deliberately, carefully, without much frenzy. Watch out for those stocks and when you find one commit.

If Trading is War, Is All Fair?

  
  Education
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An article in today’s New York Times focuses on high-frequency traders and the efforts that they are making to avoid regulations that may limit their growing power in the markets.

According to the article, “Critics say traders with access to the fastest machines win at the expense of ordinary investors by seizing on the best deals and turning fast profits before other traders.”

Many attribute last May’s “Flash Crash” to high-frequency trading, although according the article, “Regulators did not blame high-frequency traders for causing the sell-off.”

High-frequency trading firms defend that the technology they utilize to build their business is part of “stock-exchange modernization” and helping to create “a level playing field.”

How do you feel about high-frequency trading? Has its rise affected your own trading? How have you had to change the way you trade to remain competitive?

As one of the comments on the article suggested, would it be foolish to think an average trader can beat an automatic trading professional?

Jesse Livermore's Trading Rules (circa 1940)

  
  Education
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1. Nothing new ever occurs in the business of speculating in stock and commodities.
2. Money cannot be consistently made trading every day or every week during the year.
3. Don’t trust your own opinion or back your judgment until the action of the market itself confirms your opinion.
4. Markets are never wrong – opinions often are.
5. The real money made in speculating has been in commitments showing a profit right from the start.
6. As long as a stock is acting right, and the market is right, do not be in a hurry to take profits.
7. One should never permit speculative ventures to run into investments.
8. The money lost by speculation alone is small compared with the gigantic sums lost by so-called investors who have let their investments ride.
9. Never buy a stock because it has a big decline from its previous high.
10. Never sell a stock because it seems high-priced.
11. I become a buyer as a stock makes a new high on its movement after having had a normal reaction.
12. Never average losses.
13. The human side of every person is the greatest enemy of the average speculator.
14. Wishful thinking must be banished.
15. Big movements take time to develop.
16. It is not good to be too curious about all the reason behind price movements.
17. It is much easier to watch a few than many.
18. If you cannot make money out of the leading active issues, you are not going to make money out of the market as a whole.
19. The leaders of today may not be the leaders of two years from now.
20. Do not become completely bearish or bullish on the whole market because one stock in some particular group has plainly reversed its course from the general trend.
21. Few people ever make money on tips. Beware of inside information. If there was easy money lying around, no one would be forcing it into your pocket.

Warren Buffett: How I Choose The Next Person To Run Berkshire Hathaway

  
Analysis, Education
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“Four years ago, I told you that we needed to add one or more younger investment managers to carry on when Charlie, Lou and I weren’t around. At that time we had multiple outstanding candidates immediately available for my CEO job (as we do now), but we did not have backup in the investment area.

It’s easy to identify many investment managers with great recent records. But past results, though important, do not suffice when prospective performance is being judged. How the record has been achieved is crucial, as is the manager’s understanding of – and sensitivity to – risk (which in no way should be measured by beta, the choice of too many academics). In respect to the risk criterion, we were looking for someone with a hard-to-evaluate skill: the ability to anticipate the effects of economic scenarios not previously observed. Finally, we wanted someone who would regard working for Berkshire as far more than a job.

When Charlie and I met Todd Combs, we knew he fit our requirements. Todd, as was the case with Lou, will be paid a salary plus a contingent payment based on his performance relative to the S&P. We have arrangements in place for deferrals and carryforwards that will prevent see-saw performance being met by undeserved payments. The hedge-fund world has witnessed some terrible behavior by general partners who have received huge payouts on the upside and who then, when bad results occurred, have walked away rich, with their limited partners losing back their earlier gains. Sometimes these same general partners thereafter quickly started another fund so that they could immediately participate in future profits without having to overcome their past losses. Investors who put money with such managers should be labeled patsies, not partners. (more…)

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