The Original Profit-Taker
TM
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
| or "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. ___________________________________________________________________________ #1 'LIVE' Choice for December 2009 (First posted before market opening on Mon., December 7, 2009. Based on closing prices of Fri., December 4, 2009.) (#2 Team) Air Tran Holdings, 5.25% of 2016 Same crew, different convertible |
________________________________________________________________________
2009 Orders Filled Profit (Loss)
________________________________________________________________________
December 7
Buy 29 bonds at $1060.00 each
Sell short 2379 common shares at $5.16.
(Based on our game investment of $15,000 plus an additional conservative 50% margin of
$15,000)
______________________________________________________________________________
2010
________________________________________________________
September 28
Sell short 793 shares at $6.19 $816.79
(Lock-in profit)
______________________________________________________________________
September 28
Sell short 793 shares at $7.22 $1633,58
______________________________________________________________________
FINAL SCORE
TOTAL ANNUALIZED
'LOCKED-IN' PROFIT : 20%
(Based on our game investment of $15,000 plus a conservative 50% margin of $15,000)
______________________________________________________________________
THE PROFIT-TAKER GAME PLAN:
Air Tran Holdings
Common
Stock Price ($)
8.26 Long-term Goal (Uptrend)
*7.22 Sub Goal 2 (Uptrend)
6.19 Sub Goal 1 (Uptrend)
5.16 Initial Purchase Price
3.44 Sub Goal 1 (Downtrend)
1.72 Sub Goal 2 (Downtrend)
0 Long-term Goal (Downtrend)
*Underlined blue is price of last 'filled' trade.
Gamers! To verify current price, click here.
-------------------------------------------------------------------------------
Please Note Well:
In the beginning on December 7, 2009...
We bought 29 bonds. CALCULATION: $30,000 ($15,000 of which is margin) divided by
$1060.30 (price of a convertible bond) = 29 bonds.
Total investment = $30748.70
We start our plan as a half-hedge. That is, we sell short half the shares represented by our
29 bonds which equals a total of 2379 shares sold short.
CALCULATION: 29 bonds x 164.042 shares per bond = 4757.22 shares. So a half-hedge is
½ of 4757.22 or 2379 shares sold short.
Always sell short 793 shares on each move to an upside sub goal. That is, 2379 shares
sold short, divided by the 3 upside sub goals = 793.
Always cover ('buy in') 793 shares on each move to a downside goal. That is, 2379 shares
sold short divided by the 3 downside sub goals = 793.
________________________________________________________________________
CONVERTIBLE BOND FACTS:
Air Tran Holdings 5.25% of 2016
CONVERTIBLE PRICE : 106.03% or $1060.30
NUMBER OF SHARES: 164.042 shares per bond
CONVERSION VALUE : 84.65% or $846.46
PREMIUM : 25%
TERM CHANGE: 0
MATURITY: November 1, 2016
EXCHANGE: Over-the-Counter
CURRENT YIELD : 4.95 %
ISSUE SIZE: $ 100 MILLION
INTEREST PAYMENT DATES: May 1 and November 1
CALL PRICE: No call price
CUSIP : 00949PAD 10
INDUSTRY: Air Transport
________________________________________________________________________
UNDERLYING COMMON STOCK FACTS:
Air Tran Holdings
PRICE: $5.16
HI (52 WEEKS): $8.68
LO (52 WEEKS): $2.44
VOLATILITY (%) (52 WEEKS): 121 %
HI (LAST 3 MONTHS): $6.97
LO (LAST 3 MONTHS): $2.85
VOLATILITY (%) (LAST 3 MONTHS): 80%
HI (PREVIOUS 10 DAYS): $5.20
LO (PREVIOUS 10 DAYS): $4.10
VOLATILITY (%) (PREVIOUS 10 DAYS): 21%
EXCHANGE: New York
MARKET CAPITAL: 694.39 Million
DIVIDEND: NIL
SYMBOL: AAI
_______________________________________________________________________
NATURE OF BUSINESS
Company Official Website: www.airtran.com
_______________________________________________________________________
2009 Orders Filled Profit (Loss)
________________________________________________________________________
December 7
Buy 29 bonds at $1060.00 each
Sell short 2379 common shares at $5.16.
(Based on our game investment of $15,000 plus an additional conservative 50% margin of
$15,000)
______________________________________________________________________________
2010
________________________________________________________
September 28
Sell short 793 shares at $6.19 $816.79
(Lock-in profit)
______________________________________________________________________
September 28
Sell short 793 shares at $7.22 $1633,58
______________________________________________________________________
FINAL SCORE
TOTAL ANNUALIZED
'LOCKED-IN' PROFIT : 20%
(Based on our game investment of $15,000 plus a conservative 50% margin of $15,000)
______________________________________________________________________
THE PROFIT-TAKER GAME PLAN:
Air Tran Holdings
Common
Stock Price ($)
8.26 Long-term Goal (Uptrend)
*7.22 Sub Goal 2 (Uptrend)
6.19 Sub Goal 1 (Uptrend)
5.16 Initial Purchase Price
3.44 Sub Goal 1 (Downtrend)
1.72 Sub Goal 2 (Downtrend)
0 Long-term Goal (Downtrend)
*Underlined blue is price of last 'filled' trade.
Gamers! To verify current price, click here.
-------------------------------------------------------------------------------
Please Note Well:
In the beginning on December 7, 2009...
We bought 29 bonds. CALCULATION: $30,000 ($15,000 of which is margin) divided by
$1060.30 (price of a convertible bond) = 29 bonds.
Total investment = $30748.70
We start our plan as a half-hedge. That is, we sell short half the shares represented by our
29 bonds which equals a total of 2379 shares sold short.
CALCULATION: 29 bonds x 164.042 shares per bond = 4757.22 shares. So a half-hedge is
½ of 4757.22 or 2379 shares sold short.
Always sell short 793 shares on each move to an upside sub goal. That is, 2379 shares
sold short, divided by the 3 upside sub goals = 793.
Always cover ('buy in') 793 shares on each move to a downside goal. That is, 2379 shares
sold short divided by the 3 downside sub goals = 793.
________________________________________________________________________
CONVERTIBLE BOND FACTS:
Air Tran Holdings 5.25% of 2016
CONVERTIBLE PRICE : 106.03% or $1060.30
NUMBER OF SHARES: 164.042 shares per bond
CONVERSION VALUE : 84.65% or $846.46
PREMIUM : 25%
TERM CHANGE: 0
MATURITY: November 1, 2016
EXCHANGE: Over-the-Counter
CURRENT YIELD : 4.95 %
ISSUE SIZE: $ 100 MILLION
INTEREST PAYMENT DATES: May 1 and November 1
CALL PRICE: No call price
CUSIP : 00949PAD 10
INDUSTRY: Air Transport
________________________________________________________________________
UNDERLYING COMMON STOCK FACTS:
Air Tran Holdings
PRICE: $5.16
HI (52 WEEKS): $8.68
LO (52 WEEKS): $2.44
VOLATILITY (%) (52 WEEKS): 121 %
HI (LAST 3 MONTHS): $6.97
LO (LAST 3 MONTHS): $2.85
VOLATILITY (%) (LAST 3 MONTHS): 80%
HI (PREVIOUS 10 DAYS): $5.20
LO (PREVIOUS 10 DAYS): $4.10
VOLATILITY (%) (PREVIOUS 10 DAYS): 21%
EXCHANGE: New York
MARKET CAPITAL: 694.39 Million
DIVIDEND: NIL
SYMBOL: AAI
_______________________________________________________________________
NATURE OF BUSINESS
- AirTran Holdings operates as an airline holding company. Its primary asset is Air
Trans Airways.
- It is a scheduled airline service primarily in short-haul markets in the eastern United
States, with a majority of its flights originating and terminating at its hub in Atlanta,
Georgia.
Company Official Website: www.airtran.com
_______________________________________________________________________
Is the premium on the bond under 20%? 10% 2%
Of the situations being considered, how does 50% 45%
the volatility of this common stock compare
with the other candidates?
Is the market price of the convertible bond 10% 8%
under $1000 (par value)?
Does the yield (%) paid by the bond, less the 5% 5%
common stock yield, at least offset the interest
paid to your broker for margin privileges?
Does the company pay dividends on the stock? 10% 10%
( The investor must pay declared
dividends on short sales).
Is there a record of convertible premiums? 5% 5%
Does the company have assets in excess of the 5% 5%
face value of the bonds?
Is the company in an industry in which there is 5% 5%
a possibility of growth?
TOTAL: 100% 85%
Permission granted for personal and educational use only. .
Any unauthorized fund management and/or investment newsletter advice or
advisory service utilizing this intellectual property/concept as their own will
constitute an infringement of this copyright.
All rights are reserved to take any action available to recoup all resulting
financial proceeds and damages therefrom awarded by the appropriate court in
breach of this copyright.
DISCLAIMER
This game or website is not an endorsement of any security.
Information contained in this Website and attachments is of a general nature
only and is not intended to constitute advice for any specific situation. The terms
of referral bonuses may vary and are only applicable suitably qualified
professional should always be sought in relation to any particular matter or
circumstance.
Any unauthorized fund management and/or investment newsletter advice or
advisory service utilizing this intellectual property/concept as their own will
constitute an infringement of this copyright.
All rights are reserved to take any action available to recoup all resulting
financial proceeds and damages therefrom awarded by the appropriate court in
breach of this copyright.
DISCLAIMER
This game or website is not an endorsement of any security.
Information contained in this Website and attachments is of a general nature
only and is not intended to constitute advice for any specific situation. The terms
of referral bonuses may vary and are only applicable suitably qualified
professional should always be sought in relation to any particular matter or
circumstance.