Joining the party in CHME.OB

[berloga]

PAL looked good rising from the trench, so I had to sell CHME and IMMR to make a 6.6% for the shares of PAL. I still own SILC and got stuck with NGA for some reason which had a good earnings report yesterday. Don't have enough money to own more than 15 stocks! I'll perhaps lighten up on SILC and sell UTVG. The question is, what should I buy? Buy back CHME or IMMR or get in MALL? The 1st and the 3rd look more promising in the short run.

I also own MTL since $84 - finally got in. David, do you think we should consider the likes of PCU (copper) and MTL (steel) for the portfolio. These are commodities that keep on rising due to the global demand.

Thanks.
Berloga

[David Randolph]

PAL looked good rising from the trench, so I had to sell CHME and IMMR to make a 6.6% for the shares of PAL. I still own SILC and got stuck with NGA for some reason which had a good earnings report yesterday. Don't have enough money to own more than 15 stocks! I'll perhaps lighten up on SILC and sell UTVG. The question is, what should I buy? Buy back CHME or IMMR or get in MALL? The 1st and the 3rd look more promising in the short run.

I'm sorry for saying this berloga, but your trading decisions don't seem to have any rationale behind them. You're not investing, you're trading on gut feelings.

You shouldn't buy anything before deciding if you want to be an investor or a short term trader. If you want to be a successful short term trader (which is nearly impossible over the long run), you need to have the right tools to do it.

These you won't find in the 3 Stocks Premium service, because I've directed the service solely for long term investment ideas.

To me, selling CHME.OB or IMMR at this point doesn't make any sense from a fundamental standpoint. Probably your reasoning was: "these are the ones I'm losing the most, therefore my (David's) biggest mistakes, so I'll let go of them". This could make perfect sense for the trader's mind, but for an investor armed with fundamental analysis tools, the market doesn't know what it's doing over the short term, so 50% up or down in a micro cap is meaningless.

If you decide to be a short term trader instead of a long term investor you need to learn a lot of issues first and understand that success will be preceded by several years of pain and hard work. And you can spend an entire life trying and never make it, because this is what happens to most people (well, most give up after a couple of years, but there's always a new crop showing up in the markets).

I don't like talking about it, but besides being a long term investor I'm also a very short term trader in the futures markets and if you want I can point you some directions.

But I assure you that if you're a long term investor who understands fundamental analysis you'll be a rich man by the time you retire.

Good luck

[David Randolph]

I also own MTL since $84 - finally got in. David, do you think we should consider the likes of PCU (copper) and MTL (steel) for the portfolio. These are commodities that keep on rising due to the global demand.

I prefer to invest in small caps with unique investment stories. I'm not a fan of going with macro trends or buying large caps like MTL ($15.2 B) or PCU ($30 B).

But hey, you're winning a good chunk on MTL, congrats

[berloga]

Thanks for the insights, David. No, I do not have the time for short-term investing. Most of the stocks I hold I'd like to keep for as long as their fundamentals keep pointing for the share price to go up. I have held all through the ups and downs and agree this to be the best strategy. I merely meant to say that I really felt that PAL was going to supercede IMMR in the short run, so I decided to get in the former one. It all basically comes down to how many stocks I can hold. I am 100% invested at this point, which I believe will pay off this year. At the same time, if I feel one stock will beat another in a short time hence the trader's mentality considering the short cash supply.

But I get your point, since there is no way of telling which stock will prevail in the short run, I might as well just pick one out of 3 and forget the rest.

[la-onda]

thursday 1 pm webcast link (to be registered before):
http://www.wsw.com/webcast/roth16/chme/

[David Randolph]

Thanks for the insights, David. No, I do not have the time for short-term investing. Most of the stocks I hold I'd like to keep for as long as their fundamentals keep pointing for the share price to go up. I have held all through the ups and downs and agree this to be the best strategy. I merely meant to say that I really felt that PAL was going to supercede IMMR in the short run, so I decided to get in the former one. It all basically comes down to how many stocks I can hold. I am 100% invested at this point, which I believe will pay off this year. At the same time, if I feel one stock will beat another in a short time hence the trader's mentality considering the short cash supply.

But I get your point, since there is no way of telling which stock will prevail in the short run, I might as well just pick one out of 3 and forget the rest.

You did well in switching for PAL, so I just better shut up and let you use this service in the way that best serves your purposes. Good luck

thursday 1 pm webcast link (to be registered before):
http://www.wsw.com/webcast/roth16/chme/

I'm eager for this La-onda, because CHME.OB trades at less than 5 times 2007 EPS (my estimate calls for $0.45 EPS in 07, the company already made $0.30 EPS in the first nine months of the year) and that can only be due to lack of information.

CHME.OB should at least double at any time. If not at this conference at least when the company reports full year 2007 results.

[la-onda]

without listening to the conference call, just the most important slides

[la-onda]

2nd part

[David Randolph]

Hi La-onda, thanks for posting the slides of yesterday's conference.

The slides gives us guidance for the 4th quarter of 2007, if we take out from their projections the numbers achieved in the first 9 months of the year.

In terms of net income, they say they expect $5,462,000 for full year 2007 and they had $4,096,769 in the first 9 months of the year, so in Q4 the number will be about $1,365,231.

This means about 8 cents EPS on a fully diluted basis and it is lower than the 15 cents I was expecting. Anyway, this way CHME's full year 2007 EPS will be $0.38 and the trailing earnings multiple is 5.6.

CHME.OB is starting to remind me of ETLT.OB a bit and I'm getting somewhat worried that I'm wrong in my long term outlook for this stock.

But I'll wait for the full year report and management's outlook for 2008 before jumping into conclusions.

I'll keep holding CHME.OB.

[David Randolph]

CHME.OB already had its individual bear market and fundamentally it trades at just 5 times 2007 earnings. In macroeconomic terms, the company should benefit from China's aging population and their growing demand for medicines.

I'm unsure of management's honesty (also considering realcoolhead's words on small Chinese companies), but for now I'll continue holding CHME.OB.

[tokyopua]

This is one party I wish I never joined lol.  Considering David's concern about management honestly, and now the technical breakdown of the descending triangle, I had to leave the party.  Hopefully it gets better for those still holding, maybe I got out at the bottom 

[JKN]

Me too Tokyo....I'm out.  I caved on UTVG as well.  I knew when I bought these they were risky OTCs so I was prepared to take a loss.  Not again...

[tokyopua]

Me too Tokyo....I'm out.  I caved on UTVG as well.  I knew when I bought these they were risky OTCs so I was prepared to take a loss.  Not again...

It put in a nice hammer there at the end, so hopefully for those still holding this was the worst, but I am back to following technicals more.  Maybe if it hits sub $1 or something then I will pick it up again, I suppose I am not done with OTC stocks as they have made me money in the past. 

But yeah, I still have UTVG and am sort of dazed to be down almost 50% on a stock that was down so much already when I bought it, maybe I will do like you and bail on it too.  Luckily I didnt put that much money into it as I did in CHME, it was a half position. 

The bummer is losing money on the biggest up day I have ever seen in the market 

[pinoleropuro]

expect some profit taking tomorrow though!!!
careful out there it's crazy out there!

[JKN]

Me too Tokyo....I'm out.  I caved on UTVG as well.  I knew when I bought these they were risky OTCs so I was prepared to take a loss.  Not again...

It put in a nice hammer there at the end, so hopefully for those still holding this was the worst, but I am back to following technicals more.  Maybe if it hits sub $1 or something then I will pick it up again, I suppose I am not done with OTC stocks as they have made me money in the past. 

But yeah, I still have UTVG and am sort of dazed to be down almost 50% on a stock that was down so much already when I bought it, maybe I will do like you and bail on it too.  Luckily I didnt put that much money into it as I did in CHME, it was a half position. 

The bummer is losing money on the biggest up day I have ever seen in the market 

Yea, when I sold the market was retreating from its early day highs and I thought the party was over then, oh well, I let this one go past a 30% stop and was paying for it.  The past year has not been good for me, I have been killed by not taking partial profits on runups and not honoring a tight stop.  I hope I'm proved wrong for those still holding, but I think it will be a long and bumpy long ride to profits and my a$$ is already sore.  I've got to do a better job at protecting  my capital.