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"Why should the billionaires have all the fun?"TM
The ‘Game' in a nutshell
Professor Smarba supplies ‘the team'.
The stock market supplies the action.
The experience empowers you.
Ford Motor Company 4.25% of 2036
The Profit-Taker Copyright 1978, 1980,1986, 2009
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Did Ford CEO Alan Mulally annouce the best quarter for a decade?
On the contrary!
He said Ford lost $1.4 billion in the first quarter as it contended with the worst quarter
for the industry in 26 years. Excluding special items he said it lost 75 cents per share,
versus a profit of 20 cents per share a year earlier
So why the surge upward?
Ford is considered to be the healthiest of the three Detroit automakers.
The analysts surveyed by Briefing.com thought it would lose more or $1.23 per share.
Sufficient good news to create an upward wave of 16% in this dreary market.
More about what our Game options are in next weeks 'Professor Smarba's Weekly
Gamers! What are the next orders to ride these crests?
(Scroll down this page to 'The Profit-Taker Game Plan')
Our next orders are?
Place just 2 orders this time with your broker. The other on the immediate downside.
1. Cancel previous open order of Ford Motor Company.
2. Cover ('buy-in') 1322 shares of Ford Company at $4.67.
Please click here to verify prices
In a Nutshell
2009 Orders Filled Profit (Loss)
April 6 One half Profit-Taker Strategy set up.
73 bonds at $410.00 each.
3967 common shares sold short at $3.25.
April 6 1322 shares sold short at $3.96 per share = $938.62 per plan
April 24 1322 shares sold short at $4.67 per share = $938.62 per plan
April 24 1322 shares sold short at $5.39 per share = $1890.46 per plan
'LOCKED-IN' PROFIT TO DATE: 382 %
(Based on our game investment of $20,000 plus a conservative 50% margin of $10,000)
THE PROFIT-TAKER GAME PLAN
(Ford Motor Company., Common Stock)
Stock Price ($)
*5.39 Long-term Goal (Uptrend)
4.67 Sub Goal 2 (Uptrend)
3.96 Sub Goal 1 (Uptrend)
3.25 Initial Purchase Price
2.17 Sub Goal 1 (Downtrend)
1.08 Sub Goal 2 (Downtrend)
0 Long-term Goal (Downtrend)
*Underlined blue is price of last 'filled' trade.
Click here to verify these prices.
Please Note Well:
In the beginning on April 6, 2009...
We bought 73 bonds. CALCULATION: $30,000 ($10,000 of which is margin) divided by $410.00
(price of a convertible bond) = 46 bonds.
Total investment = $29930
We started plan as a one half hedge. That is, we sold short 108.696 shares per convertible
bond, for a total 3967 shares sold short.
73 bonds x 108.696 shares per bond = a total of 7935 shares. So a one half hedge is 1/2 of
7935 or 3967 shares sold short.
Always sell short 1322 shares on each move to an upside sub goal.
Simply divide the total 3967 number by the 3 upside sub goals which then equals 1322.
Always cover ('buy in') 1322 shares on each move to a downside goal.
(That is, 3967 shares sold short divided by the 3 downside sub goals).
Gamers! Our long term goal on the upside is set at 66% (50% + the 16% premium) in this 'Live'
#1 Choice (April/09).
Follow along gamers! Our 'Live' #1 Choice (April/09) is chosen because it has the potential to be
another truly informative and entertaining selection.
CONVERTIBLE BOND FACTS:
(Ford Motor Company, 4.25% of 2036)
CONVERTIBLE PRICE: $410.00 or 41.00 %
NUMBER OF SHARES: 108.696 per bond
CONVERSION VALUE : $353.26 or 35.326 %
PREMIUM : 16%
TERM CHANGE: None
MATURITY: December 15, 2036
CURRENT YIELD 10.36 %
ISSUE SIZE: $ 4500 MILLION
INTEREST PAYMENT DATES: June 15 and December 15
CALL PRICE: No call price
UNDERLYING COMMON STOCK FACTS:
(Ford Motor Company)
HI (52 WEEKS): $8.79
LO (52 WEEKS): $1.01
VOLATILITY (%) (52 WEEKS): 239 %
HI (LAST 3 MONTHS): $3.25
LO (LAST 3 MONTHS): $1.58
VOLATILITY (%) (LAST 3 MONTHS): 51 %
HI (PREVIOUS 10 DAYS): $3.25
LO (PREVIOUS 10 DAYS): $2.63
VOLATILITY (%) (PREVIOUS 10 DAYS): 19%
EXCHANGE: New York
MARKET CAPITAL: $7.79 BILLION
NATURE OF BUSINESS:
Ford Motor Company (Ford) is a producer of cars and trucks.
At this point in time no more needs to be said.
Company Official Website: http://www.ford.com
(Ford Motor Company)
Is the premium on the bond under 20%?
Of the situations being considered, how does
the volatility of this common stock compare
with the other candidates?
Is the market price of the convertible bond
under $1000 (par value)?
Does the yield (%) paid by the bond, less the
common stock yield, at least offset the interest
paid to your broker for margin privileges?
Does the company pay dividends on the stock?
( The investor must pay declared
dividends on short sales).
Is there a record of convertible premiums?
Does the company have assets in excess of the
face value of the bonds?
Is the company in an industry in which there is
a possibility of growth?
RECENT EVENTS POSSIBLY INCREASING VOLATILITY:
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Transit Connect Family One could help young families to drive green, built on a spacious yet
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Aimed at small business commercial applications, the Transit Connect goes on sale in the U.S.
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