Saturday, March 21, 2009

Sunday Investment Club

Corkface maintained his large lead last week (he's up 50% in three weeks thanks to shorting the international dog bank, HBC), but our real news concerns Image Entertainment (DISK), that penny stock we bought at $1.25 in hopes of a take-out merger at $2.75. During the week, Corkface jumped into DISK at $1.41, and I added another 2,000 shares at $1.25.

As you can see by this E-Trade chart, DISK slipped all week, and the merger look doomed. Sure enough, Friday morning -- the day the merger was supposed to close -- DISK said the acquiring firm was in breach of the merger agreement. Yikes! A plunge under a buck! But as of this writing Saturday morning, DISK management was still in negotiations to extend the deadline.

DISK issued a press release early Saturday morning.

The merger is not dead. And remember, that's $2.75 a share that could be coming, in cash, for a $1.10 stock.

Play with us anytime. Leave a comment with your email. You have 10,000 Austin Carr Dollars to invest in listed stocks (they must have symbols). You don't even need to pick a stock. Just stay in cash and bet the market's going further down. Or, since you have all weekend to buy at Friday's $1.10 close, buy 9,000 shares of DISK -- spend your Austin Carr dollars on Austin's own pick. If I'm right, and this merger closes in April, you'll be leading the 2009 Austin Carr Stock Market Challenge. (Yes, there WILL BE a package of prizes, including having a character named after you.)

Corkface’s Portfolio
20 June 20 puts HBC 3,000
2000 shares MBRK 2,840
250 shares TSYS 2,185
4000 DISK 4,400
Cash $2,760
TOTAL $15,180

Austin’s Portfolio
2000 OMEX 6,980
4000 DISK 4,400
Cash $220
TOTAL $11,600

Grandma"s Portfolio

13 shares of SPY 998
Cash $9,039
TOTAL $10,036

GIANT DISCLAIMER!!!! If you go risking real money on any of these stocks, lose hard-earned cash, and try to sue me, you'll have to tell the judge, "Yes, Your Honor, I took advice from the blog of a fictional stockbroker."


corkface said...

Now I get it Austin, you make a bad trade that has blown up the financial system and the US Gov't will just print another trillion and say "DOOOOO OVVVVERRRRR!!!! Come on folks!
One good thing here, the gov't money is targeted at the consumer and more importantly housing.
So now my question is: The US Gov't will eventually end up will all the spetic tanks holdings that dismantle the system in the first place... Does this STUFF just evaporate, now that the Gov't owns it?????????
"DO OVER" is the thing we all learned as kids but alway knew it couldn't go on. Well it still count as a "DO OVER" here so we better get it right.

Austin Carr said...

I dunno, gang, you tell me, but does it sound like Corkface is unhappy with this rally today? Think it could be because his HBC puts tanked?

Geez, Corkface, you're still whipping me and grandma's butt. Can't we have one good day without you throwing a rant?