Mr. Sensitive

June 27, 2012

FSX Third Quarter Changes

Filed under: Uncategorized — lbej @ 13:44

It’s that time again, FSXers; the last trading day of the quarter is this Friday, and change is in the air.  I was forced by the predations of private equity investing to make a move intra-quarter, swapping Justin out of WOLF and into SCI.  Justin also got married this quarter, very much apropos of the M&A madness swirling around his stock.  The WOLF/SCI swap prompted me to rethink other stocks in the Justiverse, and the spate of marriaging in general gave me occasion to reconsider others.  Then I had to review everything and everyone, because that’s how my brain works.  The results follow.

Up first are the locks, the stocks that aren’t going anywhere anytime soon.  There are nine locks: Brinkley (BCO), Katie (CATY), Lucas (LEI), Lulu (LULU), Marcus (MCS), Marisa (MOLX), Reagan (REGN), and Wilson (WILC).

Next are the stocks that are recent additions; I prefer to give a new addition time to grow on (or against) me, so these were all safe for Q3: Jenny (JNY), Jodi Ann (JOY), Justin (SCI), Lisa (LNCE), Mario the Elder (MGEE), Ruby (RJET), Winston (ED), Zero (ZIP), Zondro (ZQK).  Some of these will eventually move into the locks, and I’m already especially fond of JNY, JOY and LNCE.

The third group is safe for now, but definitely up for review for 2013.  Just four of these: Charlotte (ICE), Dustin (DST), Lee (MSTR), Namilita (NL).

That leaves the changes.

Change #1: Icarus.  I put Icarus in FLOW because it was WOLF in reverse—like Justin looking in a mirror.  That’s not the only reason FLOW worked for Icky, but it’s the reason I needed to look for the other reasons why it worked.  Plus it’s got a beta pushing 2; I prefer the FSX pets to be tamer than a 2.  So FLOW is out; in its place I’m trying an experiment.  I’m replacing FLOW with ICS, a closed-end fund that trades on the NYSE.  Closed-end funds are like mutual funds in that they are investment pools that offer share ownership to the public, but are unlike mutual funds in that they don’t redeem or issue shares on demand.  Closed-end funds issue a fixed number of shares which are then bought and sold on the open market, and thus can and do sell at a premium or discount to net asset value (mutual funds sell at NAV plus/minus load).  Much like ETFs and REITs, closed-end funds trade like equities…but they aren’t equities.  ICS is the ticker for the Invesco Insured California Municipal Securities fund, a bond fund with nearly 20 years of trading history; at a recent $15.25, it’s near the top of the 52-week range of $15.49 – $12.46.  ICS will allow me to add some bond market exposure to the FSX and to dabble in closed-end funds, all without disrupting my data-gathering and reporting procedures.  Also it’s like Justin (SCI) looking in a mirror.

Change #2: Nicole E.  This isn’t a change I needed to make, and NI has served the FSX well over the last two years.  But I’m making the change anyhow, because it’s less of a change than a restoration.  A few years ago I had Nicole in NICE (NICE Systems, a software and recording equipment provider), and I dropped it.  I don’t think I could have said why, but now I realize that she needed to get her E before NICE would fit right.  NICE has a market cap of $2.3 billion at the recent price of $36.50, and is nearer to its 2012 high just above $40 than the $27.17 low.

Change #3:  Nicole M.  This is a domino change, really; NI and COL came in together, so if NI falls, COL goes down with it.  I could ask Reagan for a recommendation; she loved the wedding last weekend and Nicole is moving up her list of favorite people in a hurry.  Alas, she’s in Hilton Head and I don’t call people except at great need, my daughters included.  If I had a good idea I could ignore the allure of synchronicity and simplicity.  But I don’t have a good idea, so I’m going with COLM, the ticker for Columbia Sportswear.  At $52, COLM has a $1.7 billion market cap and sits in the middle of its 52-week range of $66 – $41.  If it’s not ideal, it’s at least convenient; I know better than to look a gift COLM in the mouth.

Change #4:  Mario the Younger.  I can’t give Nicole a new ticker and leave Mario in musty old SUP; the first year of marriage is hard enough as it is.  I’m going with WMAR—broadcasting all Mario, all the time.  Katie tells me I have to say each letter; it’s W-M-A-R, not W-MAR.  WMAR isn’t actually a radio station; it’s the ticker for West Marine, a California company that makes boats and stuff for boats.  At $11, WMAR sports a $250 million cap and is closer to its 52-week high of $13.49 than the $6.97 low.

So that’s it.  ICS, NICE, COLM and WMAR will replace FLOW, NI, COL and SUP after the close on 6/29.  Thank you and have a nice day.

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2 Comments »

  1. Your new choices are perfect, if you ask me. Which you kind of did last night. I like helping with this part of your FSX work.

    Comment by euregirlsandboys — June 27, 2012 @ 14:04 | Reply

  2. I’m glad to have NICE back in the cut. And I do imagine Icarus when I look in the mirror, so I feel better with ICS.

    Comment by Justin Eure — June 28, 2012 @ 12:08 | Reply


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