Monthly Archives: January 2013

2012 Investment Contest Recap

The second annual investment contest wrapped up on December 31st with a record 16 participants.  For the second straight year, more portfolios underperformed the S&P 500 than outperformed, showing how difficult it is to outperform the index.

Portfolio   2012 Return
Tony 32.32 %
Tom 26.74 %
Karen 21.59 %
Greg W 16.49 %
Doc 15.68 %
Sarah 15.54 %
Ron 13.94 %
S&P 500 13.47 %
KC 11.97 %
Lee 8.59 %
Noreen 6.92 %
Mike N 6.66 %
Susie 5.63 %
Mike H 2.43 %
Brady -2.51 %
Matt -4.44 %
Lynn -6.86 %

Tony won this years contest, thanks largely to his huge January 2011 gain with USG (+26%), and MGM International (+25%).   Tom also deserves special mention, finishing 2nd this year after a 3rd place finish last year.  Tom’s picks are likely the best over the two year period of the contest.

I caught up with Tony via email to get more insight into his strategy that led him to such a huge gain for the year.  “For the first few months I picked stocks from a variety of fields, banking, housing, hi-tech, gaming. I deleted them if they had a big run up and added them back in if they had fallen.  Mid year I grew tired of working at it, so I just picked 4-5 stocks from the top of my head and kept them. Last couple months of the year I had a lead so I added some mutual funds to keep a more stable portfolio that would not be affected too much by one stock.”

Tony appears to be a top down investor, identifying market sectors that he believes will outperform the market, then identifying appropriate stocks in the chosen sectors.    Interestingly, when evaluating stocks to buy, Tony also uses technical analysis to choose his stocks, looking at market performance instead of finanials to make trading decisions.  “(I buy a stock when) technically is it at a low point.  If I feel like paying attention the technical are more important than the fundamentals.  But you have to be ready to dump it after a run up.” .  So take heart those of you that don’t dig into company 10k’s and 8qs, not all successful investors follow historical financials closely.  But you do have to pay attention.

Tony’s favorite stock right now is USG.  “just because the housing market has been so beaten up so I think there is upside. But it has already had some bit run ups so I’m not sure how much more it has.”.  Tony keeps the number of stocks he watches limited, “I pretty much stick with stocks I have been watching, a very small selection.”.

Tony’s market prediction for 2013?  “Big ups and downs as we have a series of financial cliffs.”.   Hmm.. sounds like a tricky market for fundamental and technical investors alike.

Thanks to all who participated in 2012, and good luck to all in 2013.

Followup: The Case Against Aaron Schwartz

In my previous post I questioned why the secret service was involved in the Aaron Schwarz downloading case.  Looks like we have an answer on that.   Empty Wheel has a great timeline of events that led to the Secret Service searching Mr. Schwartz Apartment alledgely related to the MIT download arrest.

In summary, on 12/27/10 Aaron Schwarz filed a Freedom of Information Act (FOIA) request for videos of Bradley Manning describing his harsh (and illegal) treatment while in prison.  On  January 6,  Schwartz was arrested on Jan 6, 2011 for unauthorized downloading from the MIT database.  On February 9th, 2011, the Wall St Journal reported that the governments case against Bradley Manning was falling apart. The same day, the government obtained warrants to search Schwartz’s house (purportedly related to the MIT case), and on Febrary 11th they search Schwartz’s house and office (though they did not search the hardware implicated in the MIT case).

So it all comes back to Wikileaks.  Not coincidentally, Wikileaks now divulges Aaron Schwartz was likely a source of information:

http://allthingsd.com/20130120/wikileaks-alleges-relationship-with-web-activist-aaron-swartz/

So, what I want to know is,  what information did Wikileaks get that has the government going to such great lengths to disregard the rule of law and civil liberties?  What secrets does the government not want us to know?   Thanks much to Empty Wheel for being one of the few organizations to follow this story.

 

 

The Case Against Aaron Schwartz

I would guess most people really didnt know who Aaron Schwartz was prior to his suicide a few days ago. I admit I hadn’t been following this story until a number of articles were brought to my attention regarding why the government was going after him so strongly (up to 35 years in jail and a 1 million dollar fine).

Mr. Schwartz was charged with downloading public documents from MIT presumably with the purpose of uploading the documents to free file sharing sites. He was not hacking anything – the method he used to walk the site and request pages programmatically is very simple – any first year programmer could write the script an an hour or two. Mr. Schwartz’s charging papers provide great insight to what he likely did:

http://www.wired.com/images_blogs/threatlevel/2012/09/swartzsuperseding.pdf

In summary, 5 different times he fired off an automated script to download these documents to his laptop. This action was repeatedly caught by the MIT IT department, who tried to block each attempt. Interestingly, one of the charges is he prevented legitimate researchers from being unable to access the documents. In reading this, it appears to me the IT departments sloppy attempt to thwart him from downloading the documents by blocking large blocks of IP Addresses was the culprit – not necessarily Mr. Schwartz’s script. It is not clear if Mr. Schwartz violated any terms of use on the site.So I found it odd – perhaps scary when I ran across this article on the US Department of Justice site:
http://www.justice.gov/usao/ma/news/2011/July/SwartzAaronPR.html

This paragraph jumped out at me:

The New England Electronic Crimes Task Force has taken an aggressive stance in the investigation of computer intrusions and other cybercrimes,” said Steven D. Ricciardi, Special Agent in Charge of the United States Secret Service in New England. “Through this task force, the Secret Service and our partners on the Cambridge and MIT Police Departments demonstrate the importance of cooperation among law enforcement to focus resources and respond effectively to investigate and prevent this type of fraud.”

One more great post here explaining why what Mr. Schwartz did was not a crime:

http://unhandled.com/2013/01/12/the-truth-about-aaron-swartzs-crime/

The term fraud and cybercrime is not applicable in this case. These were public documents open to any MIT student. There was no national security risk here – how and why did the US Secret Service involved?  This makes no sense at face value.  Anything to do with Aaron Schwartz being a free internet activist and leader in the fight against SOPA (http://en.wikipedia.org/wiki/Aaron_Swartz)?

While I do not necessarily condone Mr. Schwartz’s actions, this whole incident appears to me to be another tragic cost of the US Governments ‘War on Terror’, and how it is further eroding the rule of Law in the United States. I hope something good will come out of the tragic end to this story – but I am not optimistic.

Update:  I posted an update on explaining why the secret service is involved.

NATO vs Syria

An odd article here from CBS news – obviously fed directly to CBS from NATO. The headline “NATO Reports another Scud launch in Syria” would lead you to believe increased military activity is going on by the Syrian regime.  Unfortunately for NATO, this news feed from NATO got in the hands of a writer who softens it up with his own skeptism.

http://www.cbsnews.com/8301-202_162-57563240/nato-reports-another-scud-launch-in-syria-but-what-are-the-scuds-hitting/

My favorite quotes are “There have been no reports from Syrian opposition groups or rebel militias on the ground of ballistic missiles landing in northern Syria.” and when referring to video of Scuds being launched – “While it is impossible to verify the authenticity, date or location of the videos, the accents of the apparent soldiers heard speaking during the launches are Syrian.“

NATO is quoted as saying “(NATO)  condemned the alleged use of the unguided weaponry, with an official telling the Reuters news agency it, “shows utter disregard for the lives of the Syrian people.” .  Perhaps this is meant to urge Iran to sell Syria captured American drones so that they can kill civilians more effectively like the United States Government.

Nice try NATO – but next time try a little harder to justify your case for invasion.

A Great Reason for Not Building Stadiums

I couldn’t pass this one up – one study shows that sports teams may actually drain resources from cities:

http://www.businessinsider.com/its-actually-good-for-a-citys-economy-when-their-sports-teams-go-on-strike-2013-1

If you live in a city where the argument for a publicly funded stadium is being pushed by the media, give this some thought.  Perhaps some thought should be given to not providing public funds, and perhaps taxing them because they siphon dollars away from local businesses.