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iShares Mortgage Real Estate Capped Message Board

  • shulerco shulerco Mar 27, 2006 9:20 AM Flag

    OldWatchDog,I'm back with the numbers

    On under presentations in Remington Acquisition dated 1-23-06 on page 15, they are discussing Remington Prospect Portfoliio. Under Risked PretaxPV-10 on the right side of the table they have numbers based on $8.50 gas and $55 oil. Again on page 25, they discuss the accretion of cash flow & in the references at the bottom, #2 says based on 8.50 natural gas & $55 oil. The print is red and very small. This same reference is #1 on page 26. This is the slide show they used in conjuntion with the conference call about the Remington deal.Hope this helps. Thanks for all your good info. Momdmm

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    • ophelia.....interesting post.....thanks for that perspective! HELX moving nicely already this morning!

      Won't be long to see it back in the 40's again ..........then on up!


    • "shulerco,

      As I said in my previous post, I would acknowledge your correction if you would point out the source. You did, and I eat "humble crow" for my oversight. I actuall look at page 25 of the presentation but missed the fine-print footnote where the $8.50 mcf NG price assumption was posted. I should have known better, but "deepsub" and I were pipe-dreaming on a "what if" situation where future O&G prices would soar as predicted by some analyst. The point being made then was how the higher price differentials would drop mostly to the bottom line. That still holds true and I still think that NG prices will go above $8.50 before it ever drops to $5.50 again.

      Looking at the NYMEX, here we can see how the pro's, with their endless amount of data, make their bets:

      (1) For the remainder of 2006, NG price futures range from $7.00 to $11.14 MCF, and crude from $63.75 to $67.26.

      (2) For the long range to Jan. 2010 we see $9.14 NG and nothing under $65 Crude for that whole period.

      Now remember the pro's are betting they will be getting profits by selling their contracts above those rates. It appears the futures are treating the current price levels as more of a norm than an anomaly. That is not fool proof, but it does give me confidence.

      What was I thinking. Give me ten lashes across the mouth with a wet noodle; no, make that a boiled crawfish. I was definately aware that in FYE 2005, the average prices received by Helex (CDIS) was $8.66 for NG and $54.30 for crude. This is what happens when a 71 year old mind is only half way in gear.

      The price differencial in future isn't the only part of the story. I'm anxious to see what will happen now with the release of all that pent-up energy Helex had built up putting all of this together. The pieces are all on the table now, and IMHO the conditions are all "GO" and HELX is off to a good start.

      Old Watchdog

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