Calm Enough for Lunch Money

The market wasn't as volatile today though I didn't really look at it or Apple until around noon, and by 12:25p (PDT) I decided to hop in with a 1000 share buy at 136.04. I got out less than 3 minutes later at 136.32. Probably just being lazy by not holding to the close, but, I'm hungry and off to lunch.

A Volatile Market for AAPL

In between having my butt kicked by CSS (customized style sheets, not CSS Industries which trades under the ticker CSS) I kept my eye on AAPL, which is up on the day and seemingly heading higher into the close. AAPL had a tumultuous couple of days, selling off about 7% yesterday (I wasn't in the market at all) on rumors of cuts in production, and recovering a little of it today. It needs to get back to around $143 to recover the ground it lost yesterday (as of this wrting at 3:57 EDT, it's ~134.85.

I thought about jumping in for some lunch money. Volatility is a day traders friend usually, but I just didn't have the mindset for it. These days if I trade I think about "how do I feel?" and "how do I want to feel?" When I see 1 minute swings like the one at 3:26 p.m. EDT, of over $1 in one minute what I thought was: "I feel calm, and right now, I'd prefer to remain feeling calm." So I didn't play.

First Generation iPhone is NOT for the Mass Adopter

Someone who is much smarter than I am and way, way, way more successful who I’m sure would prefer that I not capitalize on his good name put it to me more or less like this: the iPhone like devices will someday reach mass adoption, but the first generation iPhone won’t.

He went on to complain that the phone was too much gadget and not enough phone and needed to be improved where it was more phone and less gadget.

I agreed with him about the first gen iPhone not reaching mass adoption, though for different reasons than product design specifics. I’m not really sure on the other stuff. Here were my thoughts:
--
I agree the 1st generation iPhone is not a device that leads to mass adoption. I’m not sure if we agree on the reasons though.

There are a couple of aspects about the phone that suck. one of them can easily be fixed via software and the other can be improved, but I don’t know about “fixed”. First, there’s no “speed dial” and that’s just dumb. But as product development goes, that’s not so hard to fix and can be done via software. There’s a harder problem though – if I pull the RAZR out of my pocket and flip it open, I can just start dialing. Not so with the iPhone. Here are all the steps involved:

1. Hit “wake” button
2. Slide to unlock
3. If not already on home screen, or phone functions hit “home” button
4. Touch telephone
5. Select “keypad”

There are a few shortcuts I can think of to knock steps off, but I can’t solve the problem of making it as easy as the RAZR to place an outbound call. However, it handles inbound calling much better (and better than the RAZR). It wakes itself automatically and displays the caller id info, and it’s one press to take the call (or send it to voicemail). For the added benefits of the integrated media player and web browser I can live with it taking a few button presses to make an outbound call. If voice activation is your thing, seems like that can and will be solved for.

There are many things I like about the browser implementation, but the browser has some bugs and issues which I have no doubt will be much improved by version 2.0. But as iterations go, it’s already much more Windows 95 than it is Windows 1.0

I’m guessing mass adoption occurs with the 3rd generation. By then there should be some copycats/competition. No matter what happens the iPhone can’t dominate the cell phone space as Apple dominates the portable media space with ipods. And certainly not the one flavor with a $500 and $600 pricing structure based on storage model. There are too many phones at lower prices. While one could argue the iPod isn’t always the best price/value, Apple at least has models of the iPod that play across the broad pricing spectrum.

While I have no doubt they’ll wind up being a few flavors of iPhones, seems like they’d all be in the above $300 spectrum for a while. There’s a huge part of that market Apple will not be competitive at all in but I’m guessing Apple doesn’t care. Its stated goal is 10 million units by the end of ’08. In its earnings announcement they project one million sold by the end of September. That will give them 5 quarters to get 9 million more iPhones into the world. Christmas and launch of V2 will be key, but it seems like a reasonable bogey.

Rarely is the first generation of anything gadgetry (even TV and radio) for the mass adopter. But as first generations go, it ain't bad at all.

AAPL Total World Domination on Track

Why I am not long AAPL with great resolution is indeed very quirky on my part (up over $13 in the after hours, it would have significantly outperformed my YHOO trade so far!).

To my Mac loving friends who are bitter over all the iPod attention, buck up, Apple sold about 1.5 million more Macs than iPhones in the quarter. Apple expects to hit 1 million iPhone by the end of Q3. That basically will give them 5 quarters to add 9 million more to hit the stated objective of 10 million units by the end of 2008. Five quarters to pump almost 2 million iPhones per quarter into the world.

Apple is selling almost 10 million iPods per quarter now. When I saw whatever the # was a year ago, my thought was yeah, but can that keep up? Apparently for now the answer is it can. iPod sales were up more than 20% over the prior year’s quarter. Even Macs are pushing towards 2 million sales per quarter.

The stock got dinged a little earlier in the week when AT&T reported 146,000 units for the last 2 days of June. Apple’s number for those 2 days was 270,000. Whether the discrepancy is over activation issues, or something else, I don’t know, but as Apple claims it’s on track for one million units by the end of September, we can assume Apple expects to average about 8000 units a day sold between now and the end of September. Or they’ll blow by a million a month and a half earlier and everyone will be amazed. I’m not sure what I make of the guidance other than I can’t believe Apple would talk about making a million units by the end of September if not absolutely certain it would happen.

You can read more details at:

http://www.nytimes.com/2007/07/25/business/25cnd-apple.html?ref=business

Disclosure: much to my own disgust, I really am not holding any shares of AAPL. But, I will keep singing the mantra of "buy strength/sell weakness", on that basis AAPL looks like a buy I still need to get around to (it was up over $13 to somewhere around $150 in after hours trading)

More on AAPL, YHOO and Lunch Money

On Monday I bought another 1000 shares of YHOO in my IRA, but on Tuesday pre-earnings it had run-up a bit in only a day, and I figured unless Yahoo reported something stellar (which didn’t seem likely) it would get smacked by at least the amount it had run-up pre-earnings, so I took my one day profit. The post-earnings smack down did indeed seem to play out, whether that’s on YHOO or the NASDAQ in general, I can’t really say yet. There may be more hell to pay in the market for YHOO, but regardless, I do believe it’s undervalued based on its scale relative to the competition.


Scale has value, and I don’t think this factor is currently anywhere near fully-baked into YHOO’s stock price. I’m hopeful however, it is baked into the way Yahoo will run itself as a business. As I have said, I am looking at this as a 10 year hold.

Psychology is everything when it comes to successful trading. I think I have developed (finally, and before I completely ran out of money) the discipline to not do anything very stupid, but trading-wise in my brokerage account I have really been enamored with the quick trade that makes ~$150 with the risk of losing $100 or so. I’m just trying to get into the habit of making money on my trades. I’ve implemented only one rule: if you made money, don’t second guess yourself at all and the way things have gone with the lunch money trading, I haven’t wound up needing to second guess myself for a couple of months.

Trading is something where you can get immediate results, and then new results, and then 2 minutes later results like “Argh, if I would have held 2 minutes longer I would’ve made another $200!” As long as I made any money, no second guessing. Second guessing is reserved for losing, and while I am particularly adept at second-guessing myself, it's a good rule.

It is interesting for me to see my own difference in psychology with my brokerage account versus my IRA. The main distinguishing factor between the two accounts is with my brokerage account, I look at this as money I kind of sort of need right now, and I do not feel that way about my IRA. So my psychology is actually completely different.

As a trader in my brokerage account I am currently gravitating towards the quick trade that lasts less than 15 minutes total. While I think there are “smarter” things to do, like short-term swing trading (buying and holding, perhaps intra day, perhaps for a few days, but either way much longer than 15 minutes) my psychology seems such that I’m more suited to that in my IRA. Why? Well if YHOO goes down $3 by Friday, I’ll be down over $6000 in my IRA (currently holding 2000 shares 1000@ 27.25 or so, and 1000 @ 26.08) as a result of YHOO, but I will not care. I really do believe YHOO will bounce back and I really am looking at this as a 10 year hold. Short of losing more than a quarter of its worth very swiftly, the day to day machinations of YHOO, even if they result in what looks like $6000 in losses won’t bother me at all.

However, if the same thing happened in my brokerage account, it would get in my head in a very different way. I have two goals here presently: one is to play to my strengths and my own psychology. This means I will probably stick with the lunch money trading (like today’s two 1000 share lots of AAPL that resulted in a gross gain of $180 – but only ~$150 after you factor in fees, commissions, etc) in my brokerage account and play around with swing trading a little bit in my IRA where I have more of a stomach for it). But if the results of swing trading in my IRA are good, I would actually like to change my own psychology to the point where I could make similar trades in my brokerage account Whether or not that is a real possibility or pure folly is unknown to me at this time, but I’m game to collect at least a little bit of data in the name of research.

I have my eye on one stock in particular only because I’ve watched it for about two years now. It’s a pharmaceutical company that has been sort of struggling for the last couple of years. I am big on scale, but I am also big on thinking things that make you think you feel better, or actually do make you feel better and live longer will be…very popular and profitable at least while the baby boomers are still alive. More on this later if I actually pull the trigger on the trade.

Gambling for WiFi money

One of the biggest disappointments for me with the iPhone is not the iPhone itself, but what utter crap the whole "free ubiquitous WiFi" in San Francisco turns out to be. Outside there is a lot of free WiFi, and if you're at the ballpark you're good to go, but otherwise -- you have to run into it accidentally -- or pay.

Sites like JiWire are largely useless because if there's free WiFi on the street where the establishment is, they seem to just count it. Once you get off the street and inside, it's completely different. Oh sure, you'll stumble into a place like Pier 23 on the Embarcadero that has free WiFi inside and out (and if it's nice, you definitely want to be out), but that seems to be the exception rather than the rule. What rankles me is that you can't even PAY for WiFi everywhere. There's T-Mobile and Boingo, but each only have access to a few locations in my neighborhood.

I decided on T-Mobile because it's in Starbucks and I can almost always find a Starbucks within a few blocks and it's not like I don't go to Starbucks every day already But of course since I'm not a T-Mobile customer (damn the iPhone for locking me into AT&T) it's kind of pricey at $30/mo with an annual plan. It would be $10/cheaper if I were a T-Mobile customer, and it would have been $10/mo. more if I didn’t opt for the annual plan. Hopefully it will tide me over to the next gen iPhone with AT&T’s faster network and also hopefully by then there will be some better WiFi alternatives than T-Mobile and Boingo that will give me access more places.

Given what I already spent on the iPhone though, adding another $360/yr. of expense to make my iPhone a better experience bothers me a lot on some level. I opted to gamble for the WiFi money going long AAPL for about 20 minutes. I didn’t love the trade but was up around $180 so I took the money, signed up for T-Mobile. Hopefully I’ll make the second half before I lose the first!

More AAPL

believe me, I wasn't short AAPL today either. In fact I once again didn't even look at the market until 11:45PDT. The market is catching up (getting more efficient) about the results of the iPhone launch.

I am having a few "why didn't I just..." moments. It's not like I haven't been screaming LONG, LONG, LONG AAPL. Its like a savant gift for stock picking but only if I don't actually trade it. I had the same deal with AOL for years and probably missed out on millions because I didn't trade the stock (even though I was screaming LONG, LONG, LONG for years -- and in the years I was screaming the price matched the volume of my shouting). I'm ok with it. I'd rather be right AND make money, but I'll confess, just being right feels pretty good too. I am not hopping in for a lunch money trade. I have eaten much too much lunch lately. One lesson I already learned is I *can* lose a couple of pounds without losing a few thousand dollars.

Regardless, I believe the iPhone will be the quickest to ever hit 1 million and 5 million subscribers...Curiously AT&T ('T') isn't experiencing the same exuberance in the stock market. I'm guessing that's because nobody really talks about AT&T when they talk about the iPhone.

Efficent Markets and the Lunch Money Gamble

Good news boys and girls, I was not short AAPL today. In fact, I didn't even wake up until 9:30a which is about the latest I've slept in for 2 or 3 years. I didn't even look at the stock market until 11:45 PDT and by that time it was closed (the market closed at 10am my time today, an abbreviated session ahead of July 4).

Apple was up over $5.50. I expected that action yesterday and nothing happened between today and yesterday really, but the notion of the stock market being perfectly efficient is bogus. It's a very efficient market, but it's not perfectly efficient. This inefficiency for a good trader = opportunity.

I could have bought in anticipation of this, but a.) I am not usually a buy and hold overnight kind of guy and b.)the back of your mind starts wondering if maybe someone knows something I don't know.

I think by any metric, the launch of the iPhone during the first weekend was a success, but information does not flow freely. I had seen forecasts of 200K and 300K units sold for the weekend on Thursday and Friday that were modified to 500K and 700K by Monday. The problem is, I don't know how many units were shipped and available to begin with. I didn't want that information coming out and surprising me. Without doing any research at all it looks like Monday the market wasn't sure, and today the market was quite giddy about AAPL.

In a perfectly efficient market, AAPL would have just opened up $5 higher on Monday -- that didn't happen because the market is not perfectly efficient. However, as you will see in the coming weeks, compared to many markets and especially one market in particular (the market for advertising), the stock market is extremely efficient.

Anyway, as I have been writing for over a month now, I'd be LONG, LONG, LONG AAPL. I see it going to $500 before I see it going back to $50. Not enough to bet on it, but that's got nothing to do with my belief in AAPL, but around stupid psychology around trading that I just haven't undone yet. It's on the list of things to do, and that I get a chance to even ever think about that at all, that's what America and independence really mean to me. Happy July 4th!

the lunch money gamble: breakfast edition

the iPhone wore me out and I passed out at like 6:30 p.m.and woke up at 3am. decided to look at the pre-market and jumped in quickly for some lunch money. God bless America man, in a world where I'm love, love, loving the iPhone, I can still jump in with 1000 shares short @ 122.07 and cover at 121.75 in a few minutes at 5:10AM PDT and make my lunch money for the week and take a picture of it...with the freaking iPhone!



I'd be long APPL over the long haul, but I'm more of a RIGHT NOW kind of guy than a long haul kind of guy.

Gambling for iPhone Money

trading AAPL, natch. Cleared $662.84 which would just about cover the 8GB iPhone plus tax.

But it looks like for now, it's just more lunch money. I just got a call from Bill G .who is eating lunch up on Union St (where the closest AT&T/Cingular store is) and 10-15 people are already in line. My plan was to go up there at 4:30p.m., but I'm not going to bother. While it's true I could just sit in line for the next 8 hours and finish up 24 season 5 on the iPod, these scenes generally involve the look at me, look at me! crowd (you have probably seen pictures of the clowns at the Apple store in SF -- and I'm not being mean, they're actually dressed as clowns!) and I generally try to stay as far away from people like that as I possibly can.

But it's only 12:05p, and it's the freaking iPhone...I may change my mind.

More Lunch Money Gambling

same gamble as yesterday. Went long 1000 AAPL @ 119.37 and got out at 119.49. For a total cleared of $98.27. The total trade took 1 minute and 1 second. BTW, as I am posting this 119.09. Timing is everything...



Hey, a man has to eat. update 13:02PM PDT" AAPL closed at around $119.70, so this trade wasn't going to kill me unless I would have freaked out and exited at $118.72. The beauty of the 5 minute (or less) trade is "freaking out" should never happen.

Why AAPL Will be Higher in 5 Years

Disclosure: I'm almost always wrong 20% of the time. I use the 80-20 rule and strive to have 100 opinions a day. Usually at least 20 are wrong. It's an absolutely fantastic way to learn though. When it comes to the stock market, while my opinions are fewer, I'm probably only right 20% of the time. But I think this is the 1 out of 5.

Why I love Apple Computer

I'm sure my friend Bill G. and my old friend Mark Hurst will get a chuckle out of this. They'll ask me what took me so long. But this isn't about the reasons they love Apple. They actually love the computers Apple makes. Bill G., he couldn't care less about an iPod, bizarre as that may sound. I can go more bizarre. Hurst didn't even own a TV when I met him. I finally talked him into letting me dump an old 20" set on him before I moved to California. I played up the fact that he sometimes liked movies and he could hook a VCR up to it (these were still pre-DVD days). Much has transpired, and I'm pretty sure Hurst has a TV now, but…I wouldn't bet any money on it.

Bill and Mark have their reasons for loving Apple. I have my own.

Steve Jobs. He really does have that vision thing. there is much more in the 'read more..'

Real Steve Jobs. He's the only executive out there on a large scale that I see as really being ahead of the curve. His quest for total world domination is just beginning. The iPhone will have to be a huge flop which is possible, I suppose, but I'll be surprised. What I think will happen is the phone will have some issues, but they'll get addressed in V2 and the juggernaut that is Steve Jobs and Apple will just keep juggernauting.

Here's one way he's ahead of the curve. Nice handheld device that works with WiFi that (allegedly) has a relatively good battery life. This reason alone has me considering V1 very strongly. Because of Steve Jobs I will almost certainly be saying bye-bye to Verizon as my cell phone provider.

Verizon doesn't offer WiFi, though they do have a fairly fast network for accessing the Internet from your phone. The phone I have will absolutely stream windows media. Except that Verizon blocked that from regular Internet Web access. Verizon wants you to pay $14.95 a month for its VCast service with a very limited offering. Verizon will try to tell you that the offering is not limited, but quite robust. But it's not.

My basis of comparison is that if they would have just let me stream via the Windows Media Center, I could've had access to every channel of my cable box, everything stored on my DVR and everything in my media library (music and video). VCast is not robust compared to a scaled down cable or satellite offering, it's certainly not robust compared to what I have access to. It's really not robust compared to anything other than itself.

Verizon would have been better off selling freaks like me who are way, way ahead of this curve unlimited access to its network for $14.95 a month. I would've paid for it and probably wouldn't have wound up using it much at all. I can tell what a hit success VCast has been by looking at Verizon's last quarterly report (for the period ending 3/31/07). There is exactly ZERO mention of VCast in the earnings report. My guess is when the numbers come out for Q2, again, there will be ZERO mention of VCast. And that I would be willing to bet on. $100 anyway.

Now the iPhone comes along. I don't care about how fast AT&T's network is for data. I don't care that there's no 3G – because it has WiFi. In San Francisco WiFi isn't quite ubiquitous, just nearly so much so that usually I wouldn't notice the difference. The iPhone solves 2 problems: one it's a handheld multimedia device AND a hand held Internet appliance that will work pretty much wherever I am. If it works anywhere near as well as advertised (which is by no means a given), it will be a huge success.

There is the small problem where I switched from what was AT&T (Cingular) to Verizon because although I live in an urban area, when I had Cingular I rarely got any bars in my home. Hopefully they have corrected that by now.

The launch of the iPhone kills VCast off as far as I'm concerned and it was dead on arrival to begin with. This is no big deal. Verizon doesn't do "that vision thing", but what telco does? Verizon had a chance at the iPhone and initially I thought they were smart for passing. Jobs wants Apple calling all the shots. I wonder if Jobs talked AT&T into including the Apple logo on the monthly statement. That would make the transition more seamless when they get around to taking the AT&T logo off. Ok, I jest. Kind of.

Killing a deader than dead VCast is no big deal, but this is: Apple's iTunes Store is now the 3^rd largest retailer of music, passing Amazon. That's right, someone selling DIGITAL music, is the 3^rd largest retailer of music. Apple has about 10% of the market (9.8%) trailing only Wal-Mart (15.8%) and Best Buy (13.8%). All this really means right now is a few things:

1. Digital music sales represent at least 10% of the whole pie
2. Distribution is so fragmented that you can have 10% of the overall market and be in 3^rd place.
3. If you make it easy and make buying music a good experience, a lot of people will buy it digitally instead of steal it digitally.
   

The CD isn't dead , Amazon and Target (#'s 4 & 5) still combine for more sales than Apple, but that's the trend. And it's way, way early days for that trend as far as video, but that's going to be the trend with that as well. Everyone who likes more flexibility and control over their media and is not change resistant will want their media in digital format to begin with. There are always those resistant to change. But you wait them out and they either change or die. The world moves on either way.

It's going to be at least 5 years before Apple rips me off and launches the "Put your TV on your iPod/iPhone" campaign, but I still believe that's what Steve's Little Hobby™ is all about.

Microsoft didn't design for this kind of stuff, not even when it set out to compete with the iPod with the Zune. The Zune does have WiFi built into it, but it's old school 802.11b. Not only that, they didn't turn on real live Internet access (you can talk to another Zune apparently, if you could find…another Zune, but you can't browse the web).

The Zune would've made sense to me as a portable media device if it had enabled WiFi. It's got a nice screen and it works fairly seamless in terms of "synching" with a media center. But I am near a half terabyte in media storage, and growing. The Zune can't hold all that or do "live tv". But the iPhone can.

There are other portable media players that are missing the boat too. I saw a very nice one from Archos, but they want you to use their software. It does have WifI, and it's got a nice screen, but a few things. One thing the good old pre iPhone iPod has taught me. I don't need a bigger screen to enjoy video remotely. The Archos is slick, but it's not going to fit into my pocket any more comfortably than a PSP (and perhaps less comfortably) and that's not all that comfortable really. But the Archos doesn't want to hook into my media center, it wants to hook right up to my cable box and use its own DVR docking station to record programs. If I were starting from scratch today with portable media, I might give it a look.

With Apple, I won't have to. Apple is making the first handheld device I can use to stream video. I know, there are handhelds that do this now. I have one. It's an iPaq and it does a nice job but the battery life wasn't very good at all with WiFi enabled.

The battery life is key to me. But if I can get an hour of WiFi access to browse or stream and still have a couple of hours of talk time, I don't think the battery life is an issue. If I stream video for an hour and won't be able to use my phone afterwards, that's a problem. For those who have continuous access to chargers that might not be a big deal. The iPhone still beats the other handhelds though because of the form factor. From the looks of it, it has a much better form factor for my pocket than even the 80GB Video iPod, and that has a way better form factor than any other portable device I have (besides the Nano, of course).

I don't see 40 million people running out and buying an iPhone for $600. But if you ask me in 5 years if I think there will be 20 million iPods/iPhones out there that do WiFi in a nice form factor, the answer is yes. That assumes some non-phone version that has similar features (the bigger touch screen, internet access via wifi, etc).

And in 10 years? In 10 years you'll be reading about how iTunes is the #3 distributor of music and video (and of course #1 in digital distribution). And by then, Apple TV isn't going to be a hobby. It'll just be some box in your house that you hook up and never think about again. It will be the box that seamlessly gets all your media wherever you want it and wherever you are. And it won't be for gearheads like me. It'll all be as easy to use as the iPod.

My Media Center runs on Microsoft Vista. The portable streaming is powered by Orb Network's software. The first handheld device to truly unleash the power of all that when I'm outside the home...is an Apple product.

Right now, I'm one of a relative handful of people who even cares. For that alone I love that Apple built this so I could take full advantage RIGHT NOW without having to wait 10 years. In ten years it will be so much better.

I'm sure there will be challengers, but like Google ten years ago, nobody knows who those challengers are. We've seen Microsoft's vision and if it's the Zune, well it's a vision, and for many people it's a very functional product.

It just doesn't liberate all my media and fit comfortably in my pocket. the iPhone looks like it will. I don't underestimate "liberating my media" and "fitting nicely and comfortably in my pocket". For now, I am sure I overestimate it, but I'm always ahead of the curve on this stuff.

Right now I think AAPL will be higher in 5 years. I could be wrong, and even if I'm right, it could go back down to $60 before shooting to $600. If your time horizon is 3 days, or 3 weeks or 3 months I don't have an opinion. But if it's 5 years, right now I would say buy APPL even with the huge run up of the last year.

all of this assumes only these three things:

1. the iPhone works pretty much as advertised
2. there will be iPods that have a lot of the functionality of the iPhone at much better prices
3. AppleTV becomes a full fledged media center/server instead of merely a media extender for iTunes
   

Gambling for Lunch Money

I didn't have the stamina to lose the rent money, so I went for lunch money instead. I was long 1000 AAPL @ 123.05 and got out at 123.22 for a 3 minute trade that I cleared almost $150 ($148.21). The total profit was $170, but especially on tiny trades, the house's cut seems steep. I don't care, it'll pay for lunch. All week.

about 5 minutes later it was down below $122.25...risky.

But of course, I got back in anyway, for a couple of more 1000 share lots...with buys at 121.97 (sold at 122.07) and 121.57 (sold at 121.68). I can stomach a little risk. I netted $324.64 0n a gross of $380. And the whole thing was still less than 15 minutes. But I could've easily have been down. It's not for those with weak stomachs. On the plus side, I can now justify at least one expensive lunch at Cafe de la Presse. If I stop...right now.

Update 6:00 PM PDT: Apple closed at $122.34, which you can see is $.71 lower than my initial trade. I did get back in the market and made just over another $100. But I should note, what I was doing today definitely was gambling, not investing and I don't know that I'd even call it "trading" other than that's what they call it. There were a couple of reasons why it was gambling, but the main one was on the trades listed here I was going long in a falling market. I wasn't so silly to think that I could "call the low". But I was silly enough to think given the volatility that I could go long and still make some pennies. It was controlled gambling on a bad spread. I was willing to risk losing $300 to make $150.

You can even make money doing that, I did today, but it's not the way to go...unless you felt like gambling for a little, which I did. The problem is AAPL went all the way down to $121.06 at one point. If I had decided to short there or even at say $121.75 and then held to the close, it would have cost me.

What I was doing wasn't totally unsafe, because I more or less had both time & money stops in. For what I was doing, I didn't want to be in any of the trades for more than 5 or 10 minutes. While not totally unsafe, it was totally stupid.

But sometimes I like being totally stupid, and at times like that I focus on lunch money, not rent money.

The problem with timing is that while overall the trend is your friend, in short little bursts that is not always the case. Today AAPL opened around $124 shot up to just over $125 and then the trend line was down all the way to $121.06 before going back to $122.34. For everyone of my trades I would have been prudent to have gone with a the trendline.

You can lose money that way too, but the odds are much more in your favor.

How I got Schooled By Ted Leonsis ( Why the NHL ain’t dead, even though the Ratings Suck!)

Robert Seidman ©June 7, 2007

Many people ask me about my confrontational style and approach and while I primarily attribute this to genetics, it’s an approach I embrace very much because it’s quite often the best way for me to learn.

We live in a wonderful world where Robert Seidman – an out of work blogger – can actually “confront” a guy like Ted Leonsis (a man with a net worth after taxes of over $100 million, who owns an NHL franchise and part of an NBA franchise).

Fortunately, Ted doesn’t have any problem with the confrontation and so for me, the out of work blogger, there is a great opportunity to think and learn. And learn I did. Because I was wrong and Ted was right.

Yesterday at about 2:45pm PDT when I was watching ESPN’s PTI and listening to Kornheiser absolutely rail on the NHL about its abysmal ratings (“if Bettman looks at these ratings and says. ‘we’re fine, everything’s good, the league’s healthy…he’s whistling past the graveyard!” If you had asked me yesterday at 2:46pm if I’d ever get around to disagreeing with Kornheiser, I’d have said, “No way, Mr. Tony is my boy!” Mr. Tony is my boy, but he’s wrong just like I was.

There is absolutely NO correlation between the VALUE of the NHL franchises (which are going up) and the national ratings for the Stanley Cup (which are going down). I am convinced of this now in the way that I am convinced that at some point this morning Apple stock (AAPL) was at around $126.50 even though not a single iPhone has yet been sold. Still, the value at that moment was the value, and does not correlate in any way to the # of iPhones sold.

While I do not believe the NHL will be in better shape 2 years from now if the national ratings for the Stanley Cup are where they are now (or worse), I do believe that “right now” the ratings are not actually indicative either of franchise values or the health of the league, and that right now things are actually much better for the NHL than they were a few years ago. More on this later...