Year 2009 Recommendations: Report Card

Now that 2009 year is over, it is time for report card on market predictions and stock recommendations I have been doing on my weekly posts.

Here are macro predictions and actual:

• DOW would cross 10000, it did it Oct and stayed mostly above that level for last two months.
• Oil would touch $80, it did touch $80 few weeks back and stayed very close to $70-80 range for most of last 2 months
• GDP would start growing in Q3, it did started growing - in fact it grew more than my prediction
• Financials and REIT would recover, they did as soon as stress tests were completed

In all, macro predictions were more or less came out to be accurate and that helped me pick my weekly predictions.

Here is summary of report card of weekly predictions (assuming one invests about $1000 in weekly stock recommendation at recommended stock price)

• Overall return: 80% (assuming dividend investments). By any standard this is winning performance (in comparison: S&P up by 23.5%).
• Best stock: XL with 354 % gain;DDR-PG: 296%
• Worst stock: YRCW: -79%
• Stocks with positive return: 26 (72%); negative return: 10 (286%)

Here is total report-card:

Symbol	Trade Date	Shrs	Price Paid	Holdings Value	Gain/Loss	Gain/Loss %	Price 12/31	Notes
ACAS	13-Apr-09	400	2.3	$976.00	$48.00	5.17%	2.44	Target:$3.60
BCS	7-Feb-09	200	5	$3,520.00	$2,512.00	249.21%	17.60	Target: $10
BCS-PD	7-Feb-09	100	9	$2,486.00	$1,578.00	173.79%	24.86	Target: $18
CENX	8-Jun-09	160	6.06	$2,590.40	$1,612.80	164.98%	16.19	Target: $9
CHK	8-Sep-09	50	22.22	$1,294.00	$175.00	15.64%	25.88	Target: $30
CMZ	14-Sep-09	900	1.12	$828.00	($188.00)	-18.50%	0.92	Target: $1.60
CNO	3-Aug-09	300	3.25	$1,500.00	$517.00	52.59%	5.00	Target:$4.50
DDR	6-Apr-09	400	2.51	$3,704.00	$2,692.00	266.01%	9.26	Target: $4.50
DDR-PG	6-Apr-09	200	5	$4,000.00	$2,992.00	296.83%	20.00	Target:$7.5
DPTR	26-May-09	600	1.7	$624.00	($404.00)	-39.30%	1.04	Target: $3
DRYS	25-Jan-09	100	9	$582.00	($326.00)	-35.90%	5.82	Target: $15
EROC	14-Sep-09	250	4	$1,447.50	$439.50	43.60%	5.79	Target: $6
FIG	6-Jul-09	333	3	$1,481.85	$474.85	47.15%	4.45	Target: $5
GE	22-Feb-09	125	8	$1,891.25	$883.25	87.62%	15.13	Target: $12
GNW	2-Nov-09	100	10	$1,135.00	$127.00	12.60%	11.35	Target: $15
HIG	19-Jan-09	100	12	$2,326.00	$1,118.00	92.55%	23.26	Target: $18
HUN	4-Jan-09	300	3.3	$3,387.00	$2,389.00	239.38%	11.29	Target: $6
IDG	1-Mar-09	200	5.5	$3,938.00	$2,830.00	255.42%	19.69	Target: $12
LNC	27-Jul-09	55	18.5	$1,368.40	$342.90	33.44%	24.88	Target: $30
OIL	12-Jan-09	50	21	$1,294.00	$236.00	22.31%	25.88	Target: $33
PCX	1-Jul-09	150	6.4	$2,319.00	$1,351.00	139.57%	15.46	Target: $9
PDS	20-Apr-09	300	3.33	$2,175.00	$1,168.00	115.99%	7.25	Target: $6
PEI	17-Aug-09	175	5.8	$1,480.50	$457.50	44.72%	8.46	Target: $9
PLD	30-Mar-09	200	5.5	$2,738.00	$1,630.00	147.11%	13.69	Target: $9
PMI	5-Oct-09	250	4	$630.00	($378.00)	-37.50%	2.52	Target: $6
PNX	31-Aug-09	400	2.8	$1,112.00	($16.00)	-1.42%	2.78	Target: $4.50
RF	26-May-09	250	3.8	$1,322.50	$364.50	38.05%	5.29	Target: $6
RQI	4-May-09	300	3.25	$1,821.00	$838.00	85.25%	6.07	Target: $4.50
SFI-PE	28-Sep-09	150	7.7	$1,093.48	($69.51)	-5.98%	7.29	Target: $12
SNV	-	1,000	2.03	$2,050.00	($2.00)	-0.10%	2.05	Target: $4
UNG	24-Aug-09	100	11.5	$1,008.00	($150.00)	-12.95%	10.08	Target: $16
URE	27-Apr-09	300	3.5	$2,067.00	$1,009.00	95.37%	6.89	Target: $5.25
VEIEX	16-Nov-09	40	26	$1,036.40	($3.60)	-0.35%	25.91	Target: $30
XL	15-Feb-09	250	4	$4,582.50	$3,574.50	354.61%	18.33	Target: $6
XTEX	15-Jun-09	250	3.99	$2,150.00	$1,144.50	113.82%	8.60	Target $6
YRCW	22-Sep-09	260	3.9	$218.35	($803.65)	-78.64%	0.84	Target:$6
Total				$32,019.53	$30,167.53	79.37%

So overall 2009 was interesting year and kept me going with my blogs and recommendations. Let's see how 2010 turns out - I do have some macro predictions and some interesting recommendations for 2010. But for that you would have to wait till 2010 actually starts.

Till then, Happy New Year !

/Shyam

Copenhagen: Lost Opportunity !

Finally the much hyped UN climate summit at Copenhagen got over last week. What a dis-appointment especially when there was so much anticipation created by arrival of 100+ world leaders (or should I say politicians since no one really demonstrated any leadership to save the our only planet). The leaders failed to take forward looking decisions and no meaningful accord was reached. Going forward such summits should be limited to countries which matter when it comes to climate control - those would be G20 forum since those countries are responsible for nearly 80% emissions.

We are almost at end of 2009 - only one week remaining which would be slow week for markets since many folks have already gone on holidays. The markets are near their yearly highs and would most likely close year near these levels. DOW would likely cross 10500 next week. Since companies have not started warning pre-announcements, Q1 results should be decent. In anticipation of that, DOW would march and cross 11000 by end of Jan 2010.

Recently housing market and energy markets have started showing quite a bit of activity. Considering that, I would still consider my previous recommendations as potential buys during these slow times: SNV ($2), ING ($9.80), GNW ($11.70), EROC ($5) and XTEX ($7)

That's all for now. Happy Holidays !

/Shyam

S&P: CY 2009-2011 = CY 2003-2005

Someone has said "If you want to predict future, look into past". And when it comes to investing, studying history and psychology is more profitable than studying finance and accounting (that is also required but without understanding basic human traits, numbers can fool you)

So let's look at recent past when economy came out of last dot.com induced downturn.

• Sept 2000: S&P at 1520; Oct 2007: S&P at 1556
• Mar 2003: S&P at 829; Mar 2009: S&P at 684
• Dec 2003: S&P at 1096; Dec 2009: S&P at 1100

As you can see, the levels are so much similar - only difference is that last time markets went from high to low over the period of 30 months whereas this time it happened in 18 months.

So looking at 2004 and 2005, let's predict what could happen in markets over next couple of years:

• Mar 2004: S&P at 1156; Prediction: S&P could be 1150 to 1200 by Apr 2010
• Summer of 2004: S&P at 1050; Prediction: S&P could test 1050 by summer of 2010
• 2004 year-end: S&P at 1212; Prediction: S&P could be 1200-1230 by 2010 year-end
• 2005 year-end: S&P at 1250: Prediction S&P could be 1250 to 1300 by 2011 year-end

If these predictions came true, we are looking at gain of 5 to 10 % in one year and 12 to 18% in 2 years. Not bad if we know in advance !

So while there would be quite a bit of volatility in the markets over next 12-24 months, if you believe long-term trends are towards upward direction, just relax, invest at regular intervals and enjoy your holidays.

Cisco celebrated it's 25th Birthday - here is small video which Yash and Isha created.

Have a great week !

/Shyam