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Linn Energy, LLC Message Board

  • ronharv ronharv Jan 30, 2013 1:30 PM Flag

    Today's Trading

    Profit-taking looks overdone at lower than 38.75, so I went back on margin with (gulp) 6K in units at 38.73 & 38.74. I'll put in a stop loss with about a $1k risk. If my luck holds, I'll sell sometime between now and Friday's close. Actually, the same goes if the luck doesn't hold.

    (OT - For the football gamblers on board: Two of my convention-attending kids were in Vegas the past couple of days, and I had one bet $660 for me on San Francisco at -3.5 pts. Not bad, as I think the 49ers should be 5 or 6 pt. favorites.)

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    • In order to replace MAKO as a position in the wife's IRA, I finally purchased some shares of Linn Co., LLC (LNCO), the "umbrella" company of Linn Energy, LLC (LINE), a Master Limited Partnership [MLP], which I hold in my own IRA. As many folks will tell you, holding an MLP in a tax-deferred account such as an IRA tends to neutralize the tax advantages that investing in an MLP offers. However, I like the Linn family of companies and their distributions, so decided to start our "transfer" from LINE to LNCO by making this initial purchase in my wife's IRA now.

      Looking at My Mad Method [MyMM] and how I've applied it to my wife's "superlist" combination of the stocks I've put on her watch list, plus the stocks she currently holds, LNCO scored very poorly, turning up with an unweighted MyMM Rank of just 29 out of 30. However, a primary cause for this poor score is that LNCO is a very new stock, having only been issued for the first time in Q3 of 2012; as a result, its scores for certain MyMM metrics such as Payout Ratio, 5 Year Dividend Compound Annual Growth Rate [CAGR], P/E, ROE and the BMW Method numbers are terrible. So, since LNCO is essentially just a holding company for LINE, I looked to LINE's much more impressive unweighted MyMM Rank of 7th out of 30, along with LNCO's 7.12% yield (which is close enough to LINE's yield of 7.46% for me) as the basis for selecting LNCO to replace MAKO in my wife's IRA.

      This is where the bulk of the 2012 contribution money I mentioned above was put to work, to give her a good starting balance in this "replacement" position. As is the case with my own IRA, I'd like to grow the number of positions in my wife's IRA well beyond the current nine so that we're not too exposed to any one company taking a hit to its value, or its dividend. At only nine positions, that puts her "parity" number (the target percentage that represents the allocation of each position having an equal weighting in the portfolio) at 11.11%, which makes me a bit uncomfortable.

      Unfortunately, looking ahead to expected expenses for this year, it's going to take a while for me to add more positions to her IRA and shrink that parity number down to a more tolerable level. This IRA is much smaller than mine was when I started writing about it here on Seeking Alpha, so it's going to take a concerted effort and some creative budgeting to scrape up the necessary funds to make the most contributions to it that I can each year. But you have to start somewhere, right?

    • Stopped out and gave back $540 of my lucky option profits. The trading looks so sloppy that I'm now afraid to gamble either way on this. I'll just wait for the generous distribution.

    • Line is going back down to 35 level. There is no oversold condition as this is profit taking prior to ex dividend date. This stock will be down to 37-38 by Tuesday.

      Sentiment: Strong Sell

    • I saw a couple days ago that someone had LSU at 12-1 odds to win the championship next year. If you could short betting odds I would short that one.

    • What's the payoff if you win the bet?

      • 1 Reply to rlp2451
      • It's a straight bet, meaning I give or take the points, depending on the team, with the usual 11-10 house odds. So that means I would win $600 plus get back my $660 if the 49ers deeply care about me and my money and the fact that I'll have spent a few hours cheering and spewing epithets at my TV screen while my considerably more dignified wife doublechecks that all the windows are closed. Also, if I win (of course I'll win), I send the ticket in via certifed mail and they send me a check.

0.180.00(0.00%)May 23 3:59 PMEDT