What About Bob?

I opened up the request lines yesterday afternoon offering my services to anyone who wanted to ask anything about trading, algorithms, or stocks.

Only Bob asked, so Bob gets his own post.

Bob, I like where you are at owning MOS, GE, and BRKB for many years.  MOS and GE offer you a dividend greater than anything you are earning in the money markets, and GE is one of the best companies in our country.

MOS used to be a real hot shot back in 2007-2008 with hot money and momentum guys getting their kicks in the name.  After the steep correction the dividend program started up and since then the stock has traded a bit more benign.  I can practically draw a straight line through the price action from mid 2009-to-present which to me presents a stock I would find little interest in trading, with my style.

The recent earning’s gap lower was a quick move to range lows and we have seen a snap back since.  Many of the other AG plays made a similar move and the industry overall is starting to gain the attention of value guys.  When you consider seasonality, we are coming into a five month long period of historical strength in MOS, and October is an especially strong month for the entire ag-chem industry.

The beat down may have put many investors underwater so overhead supply becomes a concern, but buying weakness verses about $37.50 and looking for a mean revision trade back to the low $50s may be a viable consideration with the seasonality winds at your back.

BRK/B has been a fantastic performer over the last few years and the long term trend is still up.  You have a well diversified position.  I see no reason to overly analyze this position.  It was looking weak for a bit last week which was one the primary motivators to my SKF position.  I stopped out on SKF because strength came back in.  I would take a weekly chart, put your favorite moving average on it, and buy dips as close to that moving average as possible.  If you want to reduce exposure, that is always okay too.

You could have incurred fees to have some money manager do exactly what you took upon yourself to accomplish.  For avoiding such expenses and keeping things simple, I tip my hat to you.

Finally, I work on very short time frames mostly Bob, so take my thoughts with a grain of salt and always use your own best judgment given your financial conditions and needs.  I do not own any of the stocks mentioned in this post and nothing written here should be considered advice but rather educational.  For a full disclaimer, please see the fine print at the bottom of the website:)

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