Yearly Archives: 2012

no-cover
October 09, 2012
Other

Slowing Growth, Higher Returns?

Richard Croft

Another institution has cut its growth outlook for the Asia Pacific basin. In this case the World Bank which believes that China may be headed for a protracted period of slower growth. Although one should put that into perspective as 7% per annum GDP growth is considered slow for China. The concern is that China is feeling the...

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10 years ago
no-cover
October 01, 2012
Other

Noise and the Naked Put

Richard Croft

Like the naked city, there are a thousand horror stories about the naked put. Some traders will tell you that selling put options is the worst strategy to use. Regaling countless stories about investors who have been wiped out because of adverse moves in the market. Too bad really! Naked put writing can be a powerful tool that...

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no-cover
September 24, 2012
Other

Buying on a Pullback?

Richard Croft

Your psyche is torn… Central banks have a plan, and they seem to be implementing it. The ECB is willing to purchase unlimited amounts of sovereign debt to prevent a default / re-structuring / bailout / or insert nomenclature here, which effectively keeps the EU intact. Not to be undone, the US Federal Reserve is providing...

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no-cover
September 17, 2012
Other

Shifting Sentiment?

Richard Croft

Sentiment is fickle. It can change with the wind and it can dramatically impact financial markets in the short term. It can cause panic selling or panic buying. Often with information that taken in context would have very little long-term impact. It is the time of season for sentiment shifts. Aside from the volatility that...

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no-cover
September 04, 2012
Other

The Synthetic Convertible Security

Richard Croft

Consensus wisdom puts forward the position that traders who buy options are speculating. But that is far too general a statement. Long only strategies the synthetic convertible – i.e. the combination of long calls and a fixed income instrument – can actually reduce risk. Traditional convertible debentures or convertible...

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no-cover
August 20, 2012
Other

Fertilizer Wars!

Richard Croft

Are the sum of the parts worth more than the whole? When it comes to Agrium Inc. (AGU, Friday’s close $98.86) the company’s Board and its major shareholder (Jana Partners LLC, an activist hedge fund domiciled in New York which owns 4% of Agrium’s outstanding shares) find themselves at polar ends of a valuation spectrum....

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no-cover
August 13, 2012
Other

A RIM Do Over?

Richard Croft

The shares of Research in Motion (TSX: RIM, Friday’s close $8.22) have moved higher in the last few days with the biggest spike in price occurring last Wednesday. You may recall my post on June 30th where I talked about a RIM death spiral and to my mind I see no change in the fundamentals of the company that would alter my...

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10 years ago
no-cover
August 06, 2012
Other

A Preferred Share Alternative

Richard Croft

Despite the lack of guarantees normally associated with fixed income securities, individual investors generally consider preferred shares a reasonable alternative to bonds. Probably the result of the favorable tax treatment that the Canadian government accrues to dividends. To that latter point, the after tax return on...

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no-cover
July 30, 2012
Other

Playing a European Renaissance

Richard Croft

Mario Draghi, head of the European Central Bank (ECB), pledged to do whatever is necessary to save the euro and the eurozone. Promising to deliver “enough” as long as it falls within the ECB’s mandate. Like any well oiled propaganda machine the most influential European politicians lined up behind Draghi and stoked the...

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no-cover
July 23, 2012
Other

Is the Bear Calling?

Richard Croft

One can make the case that global markets have turned over and are now entrenched in a bear market phase. Global growth is slowing – particularly in China – and the eurozone collapsing under the weight of recession and political apathy. And while the US markets may be the best house in a bad neighborhood I see nothing that...

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10 years ago
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