Bookkeeping: Continuing to Sell Down Baidu.com (BIDU) and Mercadolibre (MELI)
Posted on Friday, April 18th, 2008 | In Stocks to WatchParabolic charts make me nervous. I realize these names are hot, but I am going to continue to sell down, just like I have done with the commodity stocks I like, as the charts go at nearly 90 degree angle upwards. There will be a sell off in all these names going ballistic; the question is when and from what price point. I’ll let other people chase these up, and buy when the last ones on the ship start panic selling.
I cut both these yesterday worried about an adverse Google (GOOG) reaction (wrong! but at least you see the thought process) [Apr 17: Reducing Baidu.com, Mercadolibre Ahead of Google Earnings], and am taking out another layer from both, to sub 0.5% stakes. No change to fundamentals of course – the froth level is starting to set off my radar. We are now reaching level alert Orange on froth…
Baidu.com is up nearly 9% to mid $330s, MELI is up nearly 6% to near $53. They’ve come a long way in a short time.
For those of you who follow options; and speaking of speculation ….if you wanted a lottery ticket you could of bought Apr 500 calls yesterday for 55 cents… if you bought 100 calls that would cost you $5500
At today’s price of $543 for GOOG, you would have $430,000. Not bad work for 24 hours. 
Now that’s a bet on black!
Long Baidu.com, Mercadolibre in fund; no personal position but wish I was smart enough to buy 100 April GOOG 500 calls yesterday at 3:50 PM.
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 About Trader Mark (http://fundmyfund.blogspot.com)
Mark is a self taught private investor, fascinated by the market since an early age, discovering mutual funds as a teenager in the 80s, and then moving to equities by the mid 90s. His equity focus is identifying secular growth trends, and the companies most likely to benefit from these macro trends. Stocks are identified through fundamental analysis, although basic technical analysis is used in determining entry and exit points. With a degree in Economics from the University of Michigan, a broader understanding of the economy as a whole, along with interpreting investor psychology is also a major interest for Mark. His career background has focused on financial analysis in corporate America. |
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