DARK HORSE HEDGE – Here I Go Again, RAIL
By Scott Brown at Sabrient, Ilene at Phil’s Stock World
I don’t know where I’m going
But, I sure know where I’ve been
Hanging on the promises
In songs of yesterday
And I’ve made up my mind
I ain’t wasting no more time
But, here I go again
Here I go again
Since early September when the MACD 12-26-9 indicator we use for tilting the balance of the Dark Horse Hedge VIRTUAL portfolio crossed over, the S&P 500 has been traveling due north without correction. Dark Horse Hedge predicates itself on using a Long/Short tilt to manage beta (risk) so that investors can earn alpha (return) in ANY market. As part of our overall balanced Long/Short strategy, we shorted Barnes & Noble in our VIRTUAL Dark Horse Hedge virtual portfolio on Sept 2, 2010.
While not all our short positions have performed as poorly, Barnes & Noble (BKS) managed to lose almost 10% of its valuation in a market where the S&P index has soared 17%. However there now appears to be support for BKS in the 14-15 range. Therefore, we are covering this short position.
BUY TO COVER, BKS at the market, Monday, November 8, 2010
An old friend, RAIL, followed the market higher during the same period and now gives us an opportunity to short it again. Dark Horse Hedge shorted RAIL on July 29, 2010 at $24.19 and covered on August 24, 2010 at $21.50. Today we find RAIL trading at $25.64 and, if anything, the company’s performance has gotten worse. Q3 had been anticipated by analysts at -$.04 but the company announced a dismal -$.39 last week. Unfortunately, demand for railcars just isn’t very robust and it doesn’t appear likely to change soon. So “I ain’t wasting no more time” and feel that it is time to re-enter a short position on RAIL.
SELL SHORT, RAIL at the market, Monday, November 8, 2010
