I don';t give much credence to IBD in as much as they usually are late to call a market in distribution or accumulation. That being said the rise in crude could well have been short covering. Deutsche Bank within the last few days recommended that their clients cover their short position on oil. Deutsche Bank suggested clients short oil earlier this year so they seem to know what they are taking about.
Everyone knows you are short Karen. Congratulations! Now get off this board. Your bankruptcy comments are not appreciated for someone who has already lost a lot of money.
Everyone understands the potential for losing money if a stock they buy loses value. The problem with selling puts is that you will need the cash to buy the stock if the stock loses value and the buyer of the put exercises the option. I have been watching the puts but there is not much money to be made without a lot of exposure (long term options or an excessive number of contracts). If you think the sell off in oil is not done (and I don't) then it might be good to wait a while and keep the powder dry.
The $6 would not surprise me but I would not commit to buying unless there is some clarity about their ability to continue the distributions after this year (when a lot of the hedges expire)
There will still be a lot of volatility during the next year as oil will probably not rise much more from here. Most analysts are predicting $55 oil at year's end which is still a big haircut from the $100 plus oil a few months ago. $12-13 sounds about right but lots of bumps along the way.
What proxy vote are you referring to? The only proxy vote I have seen was the QRE proxy vote to approve the merger which I voted against. A lot of good that did me. I had a nice profit in QRE which turned into a big loss. Thankfully I had capital gains on other investments so I used this loss to offset some of the gains. I might buy this back if I see an opportunity I can't pass up.
It's not a big deal short term but the shorts are responsible for the distributions which will,be charged back to them. The next distribution is scheduled for January 3rd. Longer term these really start to add up so it makes it really expensive to stay short.
You would think that the bottom is near for refiners and producers considering that they are off 50% in the last several months but there is nothing normal about what is going on. I am watching and waiting for accumulation before I commit to any purchases.
Unfortunately, with the quarterly report just recently released, there does not seem to be any catalyst that will entice buyers. A little guidance from management regarding a reduction in future drilling plans might help somewhat.
I have given this additional consideration and I will sell my shares prior to the closing if the ETP price ever recovers. I wish I had sold this morning. I also owned QRE which was taken over by BBEP late last year. I lost a ton on that deal but I could have made a nice profit if I would have cashed out when the deal was announced. I don't know anything about ETP other than I just got a haircut on my yield.
That's not a bad idea on the puts. Why not sell the June 60 puts and pocket a little more cash? The deal will be in limbo waiting for approval long after that.
It seems that the only reason there is still optimism for DRl is the pending recovery of overpaid taxes. Whether or not they prevail in the law suit and get the refund aren't you just a little bit concerned that they continue to record huge losses? Unless they become profitable ( and I mean the next quarter and thereafter) there is no future for DRL. GLTA
A stock price of zero (if they file for bankruptcy) will take years. You should consider taking the profit from your short sale rather than get caught in some miracle last minute deal. As for me I'm just glad I don't have a dog in this anymore.
For what it's worth I sold at 8.28 and I can rebuy on January 12th without a wash sale. I can't see this sector recovering very much of the losses in three weeks. And yes, QRE would have tanked as well in the current environment.
There is a common misconception that a dividend cut will cause a drop in the PPS. That is true in some cases but not always so. In many cases the stock will rebound when the dividend is cut to a sustainable level. Management will at some point cut the dividend because it will not make sense to pay a dividend with such a large return.
Are you going to stay short and pay the distributions or close your position prior to the distribution?
You could be right. The secondary will be tempting for management right now as the stock is on a run which will make selling the secondary a lot easier. I really don't want to see another secondary. It has taken what seems like forever to get past the last secondary pricing.