Time to trade financials?

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Nov 27, 2008 6:25 am

I see a lot of interest in UYG, BAC, etc. by the average investor. Same thing with the auto makers although I wouldn't touch the common. Seems like we have some momentum going for a tradeable rally. Any takers?

Nov 27, 2008 11:04 am

GG, I traded the UYG successfully twice during the past several months. Bought it again, WAY too early as it turns out, on this last leg down. Still confident I will make substantial $ on the trade. I love the idea of a basket of stocks using leverage. You get all the volitility of any of the common stocks without all the bankruptcy risk of any single one of them. Short story long...yes, I'm a taker.

Happy Thanksgiving, all!!!!!!!!!!

Nov 27, 2008 11:38 am

I don't think every stock in that basket is going to zero so buying it as a single digit midgit would seem to be a good bet. I am not a long term holder though. I would flip if it runs 25% or so.

Nov 27, 2008 11:43 am

I'm with you on being anti-long-term-hold of UYG. I do think, though, that even at the last close price, there is a double in it short term.

Nov 27, 2008 11:55 am

Our (RJ) analysts have been saying all along that WFC, BAC and JPM are going to emerge from this mess as the stronger of the bunch.  I've been buying BAC quite a bit, in many cases a bit too early, but we'll see.  They had affirmed the dividend, but then came the MER buy, and that got chopped in half, so that 14% yield is down to only 7%.  Can that hold?  Will BAC emerge from this cycle stronger?  Will Robin escape the extra strong embrace of Cat Woman's thighs?  Tune in next week, same Bat time, same Bat channel.

Nov 27, 2008 12:32 pm

There is a spread if you buy Mer and it converts to BAC, something like $1 per share based on the closing price of mer/bac.  Wouldn't that be a pretty good play if you don't mind holding BAC (assuming the deal goes through and how can it not)?

 
There is probably debt from BAC/WFC/JPM that is decent too. I was in BWF (Wells pfd) but that flipping thing can move 3-4 bucks in a heartbeat if the common is getting trashed.
Nov 27, 2008 12:41 pm

http://www.bloomberg.com/apps/news?pid=20601087&sid=awQW0S7tW5ww&refer=home




Might be a good omen for a shortened/light volume Friday.
Nov 27, 2008 8:51 pm

Loaded up on UYG last week at 3.60 or so

Nov 27, 2008 9:00 pm

nestegg,
 So you're that bastard that actually bought at the bottom!!!! LOL.
 Great call. You stand to make a killing, IMHO.

Nov 27, 2008 9:13 pm
YHWY:

nestegg,
 So you're that bastard that actually bought at the bottom!!!! LOL.
 Great call. You stand to make a killing, IMHO.



I had been holding out for aq while and finally had the balls to pull the trigger bought for me and some clients as well.

Nov 27, 2008 9:15 pm

Nest,
 Balls is right. Yo are the man! I am in, AGAIN, at $7.40. Still think I can make a dime, just not a dollar, like you. Great call!!