Comments on Fund My Mutual Fund: Bookkeeping: Restarting LDK Solar (LDK)

Actually agg has been getting killed - go look at ...

2008-07-02T12:59:00.000-04:00

Actually agg has been getting killed - go look at Deere, Agco, CNH Global etc. Only fertilizer subsector and Monsanto to some degree have held up. So you have to discern. And even fertilizer has pulled back to some support levels yesterday mid day.

Nat gas is in its own world. Maybe thats the last general that needs to fall before we can signal the all clear.

Hoping for another day or two like this in coal myself to build up positions.

Coal got killed today.. Gas & Agg are two still st...

2008-07-02T12:54:00.000-04:00

Coal got killed today.. Gas & Agg are two still standing.

BD, I hope you were being sarcastic in my "timing"...

2008-07-02T11:57:00.000-04:00

BD, I hope you were being sarcastic in my "timing" with solar.

This is the 1 sector that has beaten me senseless. Hence I am employing the George Costanza methodology in this 1 sector since it seems to act completely different from every other sector. Instead of buying strength or breakouts or buying fundamentals... I am simply buying when they crater knowing the lemmings will be back. Not short term trades, and I have no clue which one will be the 'favored son' next time the sector rallies. I've been wrong every time trying to buy the "cheapest" so I am simply spreading across multiple names hoping 1 hits the jackpot on the next uprising. But as for timing - solar has been my arch enemy.

sdk, I don't know the answer to your query. My question to you is if you want to play this trend of livestock rising what is your alternative? In a world of few alternatives this is my only way to play the sector. Much like my Ultrashorts I own things I don't necessarily want to own but without ability to own futures directly (commodity account) or short individual name I have to go with what is available to me.

So I'm sorry I don't have the exact answer - the simplistic strategy of "crop shortage, ETF must go up" worked wonders in DBA in 2007 so I assume it will work similarly in late 2008 and early 2009 in COW. I don't see why they would act differently.

Hey Mark, I posted this comment some time ago but ...

2008-07-02T11:47:00.001-04:00

Hey Mark, I posted this comment some time ago but dont recall seeing a response so maybe you might have missed it. Anyway, with regards to COW, I'm still confused as to what exactly you're buying when you invest in that ETF. I understand its 60% Live Cattle Futures and 40% Lean Hogs...but I'm not sure its as simple as the premise that "if Hog and Cattle prices rise 30% over the next year, COW will rise 30%". The reason for my concern is that at the moment, futures contracts for next year on both of those livestock are trading at a significant premium to the nearby contract prices (i.e. the ones expiring in July and August). So hypothetically, the 2009 futures are trading at a 30% premium to current prices (say current contract price is 100, but the Jan 2009 futures contract is priced at 130). So essentially, unless livestock prices EXCEED that expectation of a 30% rise, than COW won't rise. Have you thought about this aspect? Looking down the road at futures prices for next year, is it possible that the expected rise is already "priced in" to COW? I think its more complicated than just, "buy COW, meat will be more expensive next year." Thoughts???

I don't know, man. Looks like a falling knife. I...

2008-07-02T11:47:00.000-04:00

I don't know, man. Looks like a falling knife. I got ass raped in LDK today (overnight hold). I'd like to get back in but I'm going to wait until the bloodletting stops. I think $30 is a safer entry.

But you've had very good timing in the solars in the past so you're probably right. Good luck!