* "Everyone ultimately gets what they want from the market. [...] The best measure of your intentions is the result you get." - Ed Seykota (How's that for a zen interpretation of your struggles? - Ed)
* Salacious Rumor: AMD, MU, LXK to go private? Based on a perusal of AMD's cash flows, I can't imagine it, but it's possible a private equity firm has aggressively hacked up their forecast. EE Times has the news:
Rumors are running rampant that AMD, Micron and Lexmark are separately mulling over plans to go the private-equity route, according to various reports. There were other rumors last week [...] but private equity dominated the rumor mills. According to the Idaho Statesman, Micron Technology Inc. is rumored to be a buy-out candidate amid wild activity with its stock late last week. CNBC late Friday (May 25) reported that private-equity giant Blackstone Capital Partners is interested in Micron (Boise, Ida.).
Last week, rumor had it that ''Lexmark, Micron and AMD were all on the verge of going private,'' according to a report from SG Cowen Securities. Micron lost money in its recent quarter amid a downturn in the DRAM and NAND flash markets. Advanced Micro Devices Inc. (AMD) is struggling and is seeing red ink. Freescale, NXP and others went the private-equity route last year.
* Aspiring professional investors take note:
Steinhardt doesn't think superior portfolio management can be taught. "The greatest teacher is experience," he says, noting that his own stock-trading days began at 13 when his father gave him more than $5,000 in shares of two companies. "By the time I graduated from Wharton at the age of 19, I had more trading experience than most people have at the age of 30 or 35," he says. "I made more mistakes by the age of 19 than most people make 10 or 20 years later into their lives."
It's important for a hedge-fund manager "to really feel miserable" for their mistakes and to be galvanized by "the sense that their own personal security is at risk. I felt that more than once," he adds, implying that these factors are missing in today's more comfortable and well-compensated hedge-fund world.
Ed's interpretation: you're mostly on your own as far as learning about investing, there is no substitute for real trading experience, and when you do figure things out, make sure you align your interests with any outside investors.
* I've started looking at unusual call activity as a means of humoring myself while I drink my coffee in the morning. Recently, two interesting names came to my screen, both with 15-20x the normal volume of calls: Commerce Bancorp (CBH) and OptionsXpress (OXPS). Commerce is rumored to have good news pending on an OCC investigation into related party transactions by executives, and OptionsXpress is rumored to be an acquisition target...by E*Trade.
Reuters: "Given the recent consolidation among online brokers, the rumor might have some merit," said Frederic Ruffy, analyst at options education firm Optionetics in Redwood City, California. OptionsXpress declined to comment. E*Trade Financial was not immediately available for comment.
Both of these are plausible outcomes, and I think that the news would lead to happy trading for both...so I'll be watching. Emails and comments welcome. - Ed
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