The headlines sound an omnious alarm:divbr //divdiv”span class=”Apple-style-span” style=”font-style: italic;”Bank of America tumbles on nationalization worries/span” (a href=”http://www.reuters.com/article/businessNews/idUSTRE5136DX20090204?feedType=nlamp;feedName=usdai”Reuters/a, February 4, 2009)br //divdivbr //divdiva href=”http://www.trade-ideas.com/StockInfo/BAC/BANK_OF_AMERICA_CORPORATION.html”BAC/a continues to take it on the chin: teetering on bankruptcy, government bail out yada yada yada.  If you shorted this ride – congratulations.  But is the ride over? Maybe there is more opportunity yet to find in this stock by being a student of the very recent history that befell WAMU./divdivbr //divdivdivMost people aren’t aware, but BAC offers 10 classes of preferred stock.  Prices below are as of the closing February 4, 2009:/divdivulliBAC-B  9.98  a href=”http://www.trade-ideas.com/StockInfo/BAC-B/BAC_CAP_TR_X_CAP_SEC_6.25.html”Technicals/abr //liliBAC-C  10.85  a href=”http://www.trade-ideas.com/StockInfo/BAC-C/BAC_CAP_TR_XII_GTD_CAP_6.875.html”Technicals/a/liliBAC-D  7.60  a href=”http://www.trade-ideas.com/StockInfo/BAC-D/BANK_OF_AMERICA_CORPORATION_1_1000_6.204D.html”Technicals/a/liliBAC-E  5.02  a href=”http://www.trade-ideas.com/StockInfo/BAC-E/BANK_OF_AMERICA_CORPORATION_PFD_PER1_1000E.html”Technicals/a/liliBAC-H  9.48  a href=”http://www.trade-ideas.com/StockInfo/BAC-H/BANK_OF_AMERICA_CORPORATION_DEP_1_1000SR_H.html”Technicals/a/liliBAC-I    7.80  a href=”http://www.trade-ideas.com/StockInfo/BAC-I/BANK_OF_AMERICA_CORPORATION_DEP_SH_PFD_S_I.html”Technicals/a/liliBAC-J   8.49  a href=”http://www.trade-ideas.com/StockInfo/BAC-J/BANK_OF_AMERICA_CORPORATION_DP1_1000_7.25.html”Technicals/a/liliBAC-L  360.00  a href=”http://www.trade-ideas.com/StockInfo/BAC-L/BANK_OF_AMERICA_CORPORATION_7.25CNV_PFD_L.html”Technicals/a/liliBAC-U  9.33  a href=”http://www.trade-ideas.com/StockInfo/BAC-U/BAC_CAP_TR_IV_CAP_SECS_5.875.html”Technicals/a/liliBAC-X  11.38  a href=”http://www.trade-ideas.com/StockInfo/BAC-X/BAC_CAP_TR_III_CAP_SEC_GTD_7.html”Technicals/a/li/ul/divdivspan class=”Apple-style-span” style=”font-weight: bold;”span class=”Apple-style-span” style=”font-size:large;”What Stands Out/span/span/divdivbr //divdivAll these issues descended to the $5 and $10 level – all but BAC-L which is still at $360 as of the close today. /divdivbr //divdivBack before WAMU collapsed a few preferred issues traded at the $1200 level that went the way of the dodo.  Will history repeat itself? br //divdivbr //divdivspan class=”Apple-style-span” style=”font-weight: bold;”Bottom line: all the other issues are down to $5 and $10. Why is BAC-L, which gives shareholders the right to purchase the common at $18.50, still so high?/span/divdivbr //divdivI can’t explain it but with this lesson in history, my trading compatriots and I will be closely monitoring this today.  We’ll take the above issues and create our symbol list in Trade-Ideas and throw every alert at it and see what happens./divdivbr //divdivGood luck trading!/divdivbr //divdivJamie Hodge, Director of Trader Education, greatly contributed to this post./divdivbr //divdivspan class=”Apple-style-span” style=”font-weight: bold;”Related Links/span/divdivbr //divdivHow to Create a Symbol List: a href=”http://www.trade-ideas.com/VideoHelp/Menu.html?video=Trade-Ideas%20Pro:%20Symbol%20List%20Editor”Video/a/divdivbr //divdivspan class=”Apple-style-span” style=”font-weight: bold;”span class=”Apple-style-span” style=”font-size:large;”UPDATE:/span/span/divdivbr //divdivOne of our Austin trader friends reported in on this trade:/divdivblockquoteI took 30 points out of BAC-L this am/blockquoteNice!/divdivbr //divdivHere is the chart of BAC-L:/divdiva href=”http://finance.yahoo.com/echarts?s=BAC-PL#chart1:symbol=bac-pl;range=1d;indicator=volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined”br //a/divimg src=”http://1.bp.blogspot.com/_wlx0GQEcH6Q/SYsq3ulpH9I/AAAAAAAAAMs/9wWO1Is6hb8/s320/bac-l.JPG” style=”float:left; margin:0 10px 10px 0;cursor:pointer; cursor:hand;width: 320px; height: 128px;” border=”0″ alt=”" id=”BLOGGER_PHOTO_ID_5299376523418607570″ /diva href=”http://finance.yahoo.com/echarts?s=BAC-PL#chart1:symbol=bac-pl;range=1d;indicator=volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined”Latest quote information (Yahoo)/a/divdiva href=”http://finance.yahoo.com/echarts?s=BAC-PL#chart1:symbol=bac-pl;range=1d;indicator=volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined”br //a/divdiva href=”http://finance.yahoo.com/echarts?s=BAC-PL#chart1:symbol=bac-pl;range=1d;indicator=volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined”br //a/divdivbr //div/div

Last 5 posts by David Aferiat

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