Seeking Alpha by Adding Beta

I have been wanting to write blog for some time but life got busy with kids, MBA, work and Hawaii vacation. Finally taking the opportunity of new year 2007, I decided to write up my thoughts. Reader beware - it's just free-flow of my thoughts spanning from my recent reading, movies and some investment ideas. First of all, Happy new year to all folks who happen to come across this post ! Last week saw quite a few movies like "The Night At Musuem", "The Good Shephard" in theatres and saw "The Inconvinent Thruth: Global Warming" and "World Trade Center" on DVD. I liked all 4 movies - they were covering completely different topics but I happen to like all of them. I liked acting of Matt Daemon in Shephard, family friendly comedy of Museum and the presentation of global warming problem by Al Gore in Inconvenient Truth. This really opened my eyes and I am glad I saw it with my son Yash. Not only do we need to educate our generation and act on it bu...

Much awaited part II of Munnabhai movie came in this weekend. We went to see the movie w/ Milind and Prashant's families. We went for 7 pm show to Naz theatres but it was sold out and we got tickets for 9 pm show. Overall the movie was excellent - after long time some good Hindi movie worth writing has come up. The dialogues, script was funny and it also achieved delivering some social message - basically the values about Gandiji's techings which all of us Indians have forgotten. The duo of Sanjay Dutt and Warsi had a great chemistry. I would definately recommend seeing this movie even if you are not a fan of Hindi Movies like me. Labor day weekend is good break for me before I fully get into my MBA studies...Yash had a Bhajan singing program in cultural activities in Ganeshotsav program. Yash's singning has been improving. He has started singning Mitwa song pretty well. Read about Coke+Mentos fountain. Yash wanted to try it out. The concept works but fountain was not a g...

Everyone is talking about YouTube and within few months it has become "the" company - similar to Myspace. I thought let me check out it - especially when "OK GO" song video which was uploaded on YouTube few days back came on VH1 Top 20 Countdown Myself and Yash decided to give it a try by creating our own video and upload it on YouTube. Check it out and please rate it: Yash's Boom Chika Boom

We were discussing on how to get steady income from stocks which one is owning for long-term and do not plan to sell anytime soon. Basically lot of us own stocks through ESPP or boughts stocks which we are not planning to sell due to company's long-term prospects. e.g. I have bought some EBAY when in was in mid thirties and not plan to sell anytime soon - one because it is in mid-20's and other reason is that I believe it will go back to low 40's in 18 month. However just holding the stock is not doing any good to my return. Basically here is how it works in layman's term: If you have 100 shares of of a stock say EBAY (which is selling at $ 27.15). If you are willing to sell the stock in one month if it goes to say 30 (about 10 % return in one month). Just sell a covered call option for Sept 30 which would net you about $ 30 before commission (about $ 21 after commission). If stock goes about 30, you may have to sell stock at 30 giving you 10 % return in one month. If s...

Over the weekend, I just completed a nice read of "Five point someone" written by Chetan Bhagat, 1995 IIT graduate from IIT Delhi. It is nice read about student life in IIT which is applicable to student life in any engg college in India. Some folks take it as 4 years of mugging and some folks go to extreme of just getting by enough grades to get a degree. The book was more about "what not do in IIT". It reminded me of my days at IIT Kanpur even though they were much different than what is mentioned in the book. It's nice read on sunny afternoon@beach. My next read is more serious: The end of faith by Sam Harris. So relavent to current events around the world with Israel/Hezbollah conflict, bombings in Mumbai, US war in Iraq and nuclear standoff with Iran. I have my own opinions but that's for later writing. Myspace has selected Google as ad provider. Great win for Google considering MySpace traffic is going gang-buster and that's more sticky than anyth...

Finally the rumors of Sandisk buying M-flash became real - it's good that I did not sold few shares I had in M-flash. I think it makes a great deal since Sandisk buys a good company (except some stock options enquiry) with excellent technology in a growing market and at the same time gets access to critical patents and royalty income stream. Looks like the pace of consolidation in technology industry is gaining quite a bit of momentum. The article in WSJ on technology industry matruing was really good. Basically it says that technology industry has become matured and has already grown as much it can. Extending this logic, I beleive that market valuations in technology industry is not going to grow to 1999-2000 levels ever (tech industy accounted for 34% of S&P 500 valuation in 2000 - now it's 14-15 %). Maarket would move the valuations from one tech company to another company. e.g. Most of networking industry valuation is concentrating in Cisco whereas some of the internet ...

After a long break I am writing on my blog - I was off to India for my vacation and before that was too busy in finishing first year of MBA. Now that I have off from MBA@Berkeley, I can spend some time in writing up some stuff. Today AMD bought ATI technologies and that brought me to think - should Intel buy Nvidia. I think it will fit very nicely. First of all, Intel, unlike AMD can digest acquisition like Nvidia even if they paid about $8B (for about $ 23 per share). It would get Intel into graphics chip market which is grwoing faster than Intel's own business and fits well with it's focus on PC business (unlike its communication business). After AMD/ATI deal, Nvidia is also last pure playin this space. All other parameters like P/E, P/S ratios are comparable and even lower than Intel. Last but not least, it's right across the road from Intel head-quarters in Silicon Valley. Continuing on the theme of in-organic grwoth, I do believe that SanDisk should buy M-systems to ex...

I am not sure if I am qualified to write what title suggests but let me wtite few lines anyway. Reading the annoucements coming out of CES at Las Vegas and reactions various internet companies were getting from Stock Market, it was almost feeling like 2000. Google going up by 20 bucks, EBAY and Yahoo making their own movements. So what are the main significant annoceuments and how it may change the landscape: 1) Skype going everywhere: This is one of the most significant development happening. I did not think it would happen so quickly. Now you can get a skype-enabled phone which you can use in wi-fi hotspots to make free calls. So technically when cities like SFO becomes wi-fi cities, you don't need regula phones at all ! This is far fetched but still reality is very close. In my opinion, all telcos need to watch out this fast changing development very carefully and move aggresively to play a role in that. EBAY made a very smart move by getting Skype even though it was completely ...

As continuation of my predictions for 2006, I thought let me create a sample tracking portfolio with timeline of 1 year and see how it performs. Since I do not have spare $50K to invest, best way to test my analysis of some of these stocks is to actual create paper portfolio and track it for its performance. I created this on Jan 3 morning so I assumed Dec 30 closing prices for buy. Symbol Shares Price Comm Amount Notes RIGL 200 8.10 10.00 1,630.00 Fallen Pharma company SIFY 500 10.76 10.00 5,390.00 India + Internet, what else you need ? PALM 200 31.75 10.00 6,360.00 Treo700 + RIMM woes EBAY 200 43.43 10.00 8,696.00 Auction growth + Skype CKCM 500 21.00 10.00 10,510.00 RFID play BBI 1,000 3.75 10.00 3,760.00 This is not going BK so it would recover ELN 1,000 13.90 10.00 13,910.00 Tyasbari returning to market in Apr06 Total paper money invested: $ 50256 My target for this paper portfolio is to return 15%. Let's see how it does in 2006 ! /Shyam

Since this is first time I am writing blog on a new year eve and I am kind of fond of predicting some of the stock actions, I thought let me put it in writing so I can evaluate if they were on target or not. Some of these may be obvious but nonetheless let me put them in writing. I am willing to take bets (Bhandi - are you up for it:-) Top 5 stock predictions: Google: Google hitting $ 500 (pre-split)in next 6 months (before 7/1/06), gets included in S&P and gets split PALM: Will hit $ 40 by year-end Apple: Will split 2:1 and hit $ 42 after split ($ 84 before split) EBAY: Will cross $ 50 in next 9 months (before 10/1/06) Click Commerce (CKCM): An RFID vendor will cross $ 30 (currently at $ 21) Mutual Funds: - Japan and Korea based mutual funds continue to do well. Watch out for Profunds Ultra Japan and fidelity Korea funds - Health care industry would continue to return decent returns Indian stocks: - BSE index will cross 10500 by year end - Aptech will touch 200 in one year (curre...

This was first cal game we went. Yash, Mark are having good time during half-time. It was fun to watch first college football game. Now that I am cal student, I have started taking interest in college football and it is pretty interesting. I just saw Adam Sandler's The Biggest Yard - good entertaining movie. Today my second half of Fall semester started with accounting and and markting classes in EWMBA. Both pref are pretty good and keep discussion interesting. Accounting prof Suneel is good at making fun of accountants and keep a subject like acct interesring. Markteing is whole new area for me so understanding those concepts are useful. Good thing is there is no mid or final term exam even though project sounds scary...but hey you can't learn just by reading books. So for now I am enjoying and learning my MBA. Looks like Apple stock has already paid for my "nano". Friday was the day for Google. I should have done some more study and bought Oct 220 options which were...

I have been monitoring Apple stock for quite some time and I have always admired Apple as a great innovator in computing and now music players and great marketer. I got excited by their introduction of ipod nano and went with my son Yash to check it out in Apple Store in Valler Fair Mall. It was so cool and neat that Yash wanted to buy it immediately. I mentioned to him that we will buy over Christmas and started thinking how can I use this cool nano. I started a competition on my group on whoever fixes most defects from Sept to Dec05 timeframe would get a ipod nano. We call it as "nano" race. And the group got really excited about this race and I am seeing about 30-40% increase in defect fix rate than normal conventional times. My conclusion is that folks get motivated more by public recognition and competative spirit of race. Now coming to nano for myself or Yash, I decided that I will buy nano only with money made on Apple. So I went and bought 100 shares of Apple at aroun...

Finally my EWMBA as Haas has started on 8/20 with first day at Berkeley campus. First day was pretty good - it was like having 6 day work-week. The jorney till now was started last year around Dec time when I decided to pursue my MBA and started preparing for application. After GMTA, Tofel, Essays, Reco, Admission, waiting for confirmation for admission, stats pre-req course completion and attending Haas Orientation in first week of Aug - it was already a long journey and since I survived this, I am sure that I would survive first year in which we have to complete 9 courses and total 3 years to complete my MBA. First half of first semester has two courses - one on Micro-economics and other on Organization Behaviour. Both are interesting courses and should be directly applicable to my job to some extent. Instrcutors are good. Home-work and studies have started with reading of case-studies and problem set solutions. Before it starts with full speed, I went for a round of bridge with Bhan...

Over the 4th July long weekend, I am alone since my family is in India on extended vacation. This is good time for me to catch up on my reading. I went to Borders and bought "The world is Flat" by Thomas Friedman. I had just onto second chapter and I must say that it is MUST read for anyone educated and want to get ready for this changing world order. Fortunately for us indians, the new order is much more beneficial for India (and China). I liked his concept of Globalization 1.0, 2.0 and 3.0 phases. First phase from was 1492 to 1800 when countries went on to discover other countries in search of wealth and eventually colonization came in. In 2.0 (from 1800 to 2000), big companies starting from East India Company to today's IBM had power and went across globe to become multi-nationals. In 3.0 which has started post 2000, individuals would have the power. Currently reading 10 factors which caused the world to become "flatter". More later on this reading....

When I was in India for 3 weeks from Jun 8 to Jun 26, I used to read Economic Times and watch one of the business news on NDTV or Aaj-Tak. The stock market was so hot that it reminded me Nasdaq of 1999-2000. However there was a small difference. Most of the increases were based on solid fundamentals and Indian stock market is still trading at P/E of around 15 even at this peak. I correctly predicted that all reliance stocks would jump as soon as settlement between Ambani brothers is reached and they did. I was at Solapur when this news came and I told to my brother-in-law to but Rel Cap at 282 (that day it jumped 20 % from 234) and told him that it will reach 500 in 2 years. It is already at 374. Just read that Reliance Cap has bought 51 % of Adlabs which is in entertainment and multiplexes. The stock has already jumped from 150+ to 270+ in past 2-3 weeks. I need to watch this since my guess is that this will also reach 500 in 2 years or less. More on Indian stock market and stock tips...

While going to India 4 weeks back, we had a stopover at Singapore for about 8 hours. We took the advantage of free singapore trip offered by Singapore airport. I must say that it was great trip to see city again after 10 years (we took first trip in 1995). The trip had a very good boat ride along downtown area. Singapore is the greenest city I had seen.

I was in India for 3 week vacation. It was a great vacation meeting with all family and friends. We went to few places line Vani near Nasik. We also went for a marriage on my wife's side family and from there we went to Panhala near Kolapur. It was short but exciting trip.