OCA: Another Double Bagger
Three weeks ago, I reported that I had the first double-bagger, ZMEFE (MSFT Jan 05 $25 Put) in my portfolio. Thanks to the inherent volatility of options, ZMEFE has since retreated from $2.85 to $2.05, representing a mere 49% gain now.
Today, with a spectacular 7.9% gain, my holding of OCA in Datek now stands on top of 107% capital appreciation. It only took just a month for OCA to climb from $6.10 on March 15 to $9.83 as today's close. My original purchase of 1,000 OCA shares back in April 2003 is delivering in excess of $5,000 gain now, making OCA my best investment so far.
Actually, I held another 500 OCA shares in my Roth IRA account until I sold them for $8.65 apiece last week. I don't regret that ... OCA is my largest holding and by selling the 500 shares I'm decreasing the volatility of my portfolio. Yes, I left some money on the table -- I'll be $600 better off if I didn't sell, but in my value investor's mind, $8.65 is an appropriate price for OCA when both the growth prospect and the receivable collectability are unclear.
The question for now is: how should I deal with the remaining 1,000 shares. By next Monday, these 1,000 shares will enjoy the favorable tax treatment of long-term capital gain, so it is testing my greed and nerve.
Frankly speaking, I feel the intrinsic value of OCA is appropriate $8 to $10, and the recent runup is more driven by possible short squeeze. I probably will ride it for a while (curious to see how high this issue can go when bears rush to cover), but I will most probably sell another batch of $500 if it hits $12 in the near future. Also, if this issue loses its momentum (defined by two weeks of relative price stagnation), I am willing to sell all of them.
A quick note that I am about to close my AmeriTrade account in the next five days. I opened this account back in December 2002 to took advantage of a $75 new account bonus offer. In the last 18 months, I actually only made two ... Read
Month-End Investment Portfolio April 2004 Type Quantity Avg Cost Cost Basis Current Price Value Gain (Loss) % of Portfolio After-Tax Accounts OCA Orthodontic Centers of America Stock ... Read
March 2004 Stock Quantity Avg Cost This Month Value % of Portfolio Last Month MOM Change % Change Since Entry Target % of Target FDP 148 $ 26.04 $ 25.76 $ 3,812.48 12% $ 25.46 ... Read
This week I opened a new Roth IRA account under my wife's name in BrownCo, a discount brokerage affiliated to JP Morgan. We are sending $5,000 as Roth IRA contribution ($3,000 for tax year 2003 and $2,000 for tax year 2004). The cash is mainly ... Read
