News for Today (21-Jan-14): AFSI, FB, DDD, AMTD, TSLA



Well, after setting a new year’s resolution to post more often and create the News for Today series, there really hasn’t been much news that has caught my eye but here’s some takeaways from today.

No Surprise – Changing My Mind

Earlier this month, had a couple of tough decisions to make with options expiry Friday of last week.  Here’s what the final final decision was:

  • 3D Systems (DDD): Shares got called away; would’ve liked to have picked a better strike price so that I could sell another covered call; now actually thinking of shorting the stock
  • Facebook (FB): Exercised all options and collected shares.  Will decide what to do when company reports earnings at the end of the month.
  • AmTrust Financial Services (AFSI): Looks like GeoInvesting scared this investor – with my portfolio already heavyweight in insurance and so much effort trying to bring down the stock with a small float, might be fighting a losing battle of up and down stock movement.  So, bought back the puts at a loss and also bought more of the preferred series A which still provide a 7.8% dividend (non-cumulative though)


Discount Brokerages Continue to Excel

TD Ameritrade (AMTD) posted earnings today and is up 5% on higher client assets, revenue, and income.  As was first pointed when we first bought into the company, as the economy picks up, and stock markets rise, and investors start moving money away from secure investments and into the market.  However, this investor picked to back the wrong horse as eTrade (ETFC) has beat both TD Ameritrade and alternative Charles Shwab (SCHW) since we made this investment (ETFC up 60% vs. 30% for AMTD), and in the past year (ETFC up 110% vs. 80% for AMTD).

Source: Google Finance

AMTD vs. ETFC vs. SCHW (July 2013 – Jan. 2014) Source: Google Finance
Source: Google Finance

AMTD vs. ETFC vs. SCHW (Jan. 2013 – Jan. 2014) Source: Google Finance


Watch this if you’re interested in how Tesla was started

Here’s an article/video of one of the co-founders of Tesla (TSLA), Marc Tarpenning, talking about how Tesla got started.  It’s a long video (the first 10-15 minutes are an absolute watch), but identifies the founders initial reasoning behind focusing on electric vehicles and how they got to the Tesla Model S today.  While he doesn’t talk about some of the major challenges Tesla faced as they were developing the Roadster, it’s a must watch for anyone interested in investing in Tesla.  As I’ve said before, Tesla is ridiculously overvalued and priced based on near-perfect execution of future demand. At the end of the day, no one knows whether you’ll end up paying too much for this company – but you’ll have to believe in the future of electric vehicles to make the jump.


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