More on Floyd's Shifty Fifty

We are providing examples to our bloggers of funds and stocks that we study in our Shifty Fifty portfolio. We may or may not hold the stocks or funds that have shown over the past few days. Preferred Subscribers of our www.bluechipoptions.com service gain chart and performance access, and details of when we buy and sell.

Thusly, do not take these blogs as "go buy these stocks", but that we are studying them.

Blue Chip “Mirroring Funds”

Most mutual funds are simply a bad buy. You’re paying institutional investors a fee each month to manage your account, and it’s been proved that the actively traded (vs. index) funds often boast high fees, and low returns. These “mirror” funds are either ETF’s or unique funds that are well managed, with low expense ratios.

SPDR DJ Global TITANS ETF Symbol: DGT

https://www.spdrs.com/product/fund.seam?ticker=DGT

Rationale: This ETF mirrors perfectly and is easy to trade. The SPDR^® DJ Global Titans ETF, before expenses, seeks to closely match the returns and characteristics of the Dow Jones Global Titans Index (ticker: DJGTR). Our approach is designed to provide portfolios with low portfolio turnover, accurate tracking, and lower costs

Third Avenue Value Fund Symbol: TAVFX

http://www.thirdavenuefunds.com/ta/

Rationale: We’ve invested here with Marty Whitman, who we believe equal to Buffet, but as one of the greatest value investors in the world. We usually enter and exit TAVFX with 20 to 25% returns in 6 months, if we time it right, and have returned over 65% annually several times, when value stocks were prime. It’s a core position for any conservative investor.

Zweig Total Return Fund Symbol: ZTR

(also a bond fund)

http://www.etfconnect.com/select/fundpages/other.asp?MFID=3867

Rationale: “The fund seeks high total return over full-market cycles by investing primarily in high quality bonds and to a lesser degree stocks. The fund will normally invest between 50% and 65% of its total assets in the highest quality fixed-income securities and between 25% and 35% in equity securities. Our objective is to participate solidly in rising stock and bond markets and protect the bulk of those gains in declining markets.”

This is a closed end ETF that is currently 10% below Net Asset Value, making it a bargain, and paying a dividend annually of 10.84%. The great stock trader Martin Zweig advises the fund.

Blue Chip Bonds

Aberdeen Asia Pacific Fund Symbol: FAX

The Fund is managed by Aberdeen Asset Management Asia Limited and advised by Aberdeen Asset Management Limited. The Fund's shares trade on the NYSE AMEX under the symbol "FAX".

Rationale; In order to achieve its investment objective, the Company may invest up to 80% of its total assets in "Asian debt securities", and may be denominated in an Asian Country currency or in Australian, New Zealand or U.S. dollars. At least 20% of the Company's total assets will be invested in "Australian debt securities. This is a closed end Fund, at a 9% discount, and currently paying dividends of .47 a share per month thru June of this year. Safe international income, at a discount. Long-term hold

Treasury Inflation Protected Securities Symbol: TIPS

http://www.treasurydirect.gov/indiv/products/prod_tips_glance.htm

Barclays 20+ Year Treasuries Symbol: TLT

http://us.ishares.com/product_info/fund/overview/TLT.htm?c=JAC01&gclid=CLCe94OF9JsCFRJ4xgod_Gxf_w

Proshares Ultrashort 20+ Year Treasuries Symbol: TBT

http://www.proshares.com/funds/tbt.html

Rationale for U.S. Treasuries, short and Long: TIPS are inflation protectors. TLT is a long term Treasury, so a deflation protector. TBT plays long-term treasuries short.

We use all three instruments as a large part of our CASH porfolio.

Emerging Markets

The Templeton Fund is our core investment. We often find “break out” emerging market stock that we also invest in.

Templeton Emerging Market Fund Symbol: EMF

http://quote.morningstar.com/etf/chart.aspx?t=EMF

Rationale: Mark Mobius is simply the greatest student of Templeton, and understand the Global markets well.

http://en.wikipedia.org/wiki/Mark_Mobius

Real Money Commodities

Spyder Gold ETF Symbol: GLD

http://www.spdrgoldshares.com/s ites/us/value/

Silver Standard Resources Symbol: SSRI

http://www.reuters.com/finance/stocks/overview?symbol=SSRI.W&rpc=66

or we often use Silver (SLV)

Canadian Exchange Fund Symbol: CEF

http://www.centralfund.com/

Rationale: All three ETFS/funds invest in core commodities and are excellent barometers for the price of Gold or Silver. We trade both options and long trades on Gold and Silver.

CEF invests in actual gold and silver bullion and is a very underpriced, not yet known, core way to invest in Gold and Silver.

We believe the world should be, and will be again, on the Gold Standard.

More details on Floyd's Shifty Fifty Portfolio

Important Note: We are NOT sharing a complete portfolio, but showing you the model of our portfolio. Blue Chip Options may or may not have a current holding or position. These are simply stocks we follow.

Join us as a Preferred Subscriber at www.bluechipoptions.com

Here's a few more of our Shifty Fifty for your review:

Retail/Distribution

Wal Mart Symbol: WMT

http://walmartstores.com/

Rationale: This is another company we hate. They import over 90% of their non-food products, put them in large unattractive warehouses, and sell the hell out of them. This is the greatest distribution company in the world. They’ve just opened an “all Hispanic” Wal-Mart store in Texas, testing regional ethnic distribution.

This company has revolutionized the blight of our small downtowns, while creating a distribution model that has “created the cost plus” mentality of our economics.

One cannot be part of it. We trade the stock, and options.

Berkshire Hathaway B Shares Symbol: BRKB

http://www.berkshirehathaway.com/

Rationale: This is Warren Buffet. The greatest investor of all time. It’s a superb long-term investment, at bargain prices.

Amazon Symbol: AMZN

http://finance.yahoo.com/q?s=AMZN

Rationale: Amazon is far ahead of the game with Kindle, the electronic reader. Many think Apple and Steve Jobs will do a marketing shift and soon have their own electronic reader.

Amazon just bought Zappos.com, and remains a top distribution model with Jeff Bezos, CEO, as a visionary. We trade the stocks and puts and calls.

La-Z-Boy Symbol: LZB

http:// www.la-z-boy.com

Rationale: La-Z-Boy has cut costs, and we think home redo’s, part of “cocooning” in the “new economy” will be a consumer spend. As the economy improves, LZB has great potential for earning jumps. Use a 25% trailing stop.

Computers/Software/Internet

Apple Symbol: AAPL

http://www.apple.com/

Rationale: Floyd has been trading Apple for over 15 years, and considers both it as a company, the products they make, and the way they market sheer brilliance.

We invest long in the position, and also buy puts and calls.

Research in Motion Symbol: RIMM

http://www.rim.net/

Rationale: Floyd has been trading Blackberry for over 8 years, and considers both it as a company, the products they make, and the way they market sheer brilliance.

We invest long in the position, and also buy puts and calls. RIMM is a small version of Apple, with less invention, but a strong following. They constantly surprise.

We buy this position long, and also play puts and calls on it.

Google Symbol: GOOG

http://www.google.com/finance?q=NASDAQ:GOOG

Rationale: All their money comes from advertising, a scary model, but Google is far ahead on their own version of Microsoft Office, and “Free” services that can attract even a business network. At www.bluechipoptions.com and www.oexoptions.com we often recommend Google email to subscribers having difficulty getting our bulk mail subscriptions. We advertise with this company.

Every part of doing business with this company is good, and it also trades amazingly close to the OEX projections and system. We play long on the stock at times, and often buy puts and calls. One of our traders 5 years ago made over $300,000 on one Google call. It’s one of our favorites.

Yahoo Symbol: YHOO

http://finance.yahoo.com/q?d=t&s=YHOO

Rationale: Yahoo is the underdog in the game. They never seem to get it quite right. But they are close, and have a brand name. With the right leadership we continue to believe Yahoo has great merit as an internet stock, and watch/play it long, and buy puts and calls at various times.

Agricultural

Caterpillar Symbol: CAT

http://www.cat.com/cda/layout?m=8703&x=7

Rationale: CAT is agriculture. It is the big machinery to move the world. CAT follows both agricultural and industrial development. We play it short/long, and puts and calls.

Powershares DB Agricultural Fund ETF Symbol: DBA

http://dbfunds.db.com/dba/index.aspx

Rationale: This ETF mirrors agricultural/farm products well and we trade as both put and call.

Intrepid Potash Symbol: IPI

http://www.intrepidpotash.com/

Rationale: What Potash is: http://en.wikipedia.org/wiki/Potash

We play this both long term at times, and are new to trading to this position, replacing another Potash manufacturer.

Real Estate

Proshares Ultrashort Real Estate ETF Symbol: SRS

http://www.proshares.com/funds/srs.html

Rationale: This is short on the real estate market, in an ETF fund, and one of our best investments. www.bluechipoptions.com believes we still have a huge commercial real estate bubble ready to burst. Banks/insurance companies, and many investing companies are behind the great strip and commercial mall expansion during our “years of greed”. Tenants are already requesting “price adjustments” for their declining business, and we think it’s a big surprise for America when this one bursts. We often trade this as an option.

Annaly Capital Management REIT Symbol: NLY

http://www.annaly.com/

Rationale: Annaly Capital Management, Inc. (NYSE:NLY) manages assets on behalf of institutional and individual investors worldwide. Annaly’s principal business objective is to generate net income for distribution to investors from our investment securities and from dividends we receive from our subsidiaries. Annaly has elected to be taxed as a real estate investment trust (REIT)

Industrial

KHD Humboldt Symbol: KHD

http://www.khdhumboldt.com/phoenix.zhtml?c=92949&p=irol-irhome

Rationale: Many of our traders still own this in our speculative portfolio, bought at 7.40 range, currently at 10.79 8/7/09.

We recommend buys at any time this stock is available at 9.00 or less, long term hold.

Banking

Wells Fargo & Co. New Symbol: WFC

https://www.wellsfargo.com/

Rationale: The best and brightest in the banking industry. We recently played calls on this for 50% to 64% profits.

We often watch this position for put and call, around the sector.

The Truth about Deficits and Big Government

Back in 2002 Shooter Cheney told Treasury Secretary Paul O'Neill "deficits don't matter". Later he clarified, between torture planning, "in a political not an economic context". And it was true for most of Emperor Bush's administration, constantly shifting from a bipartisan commitment to fiscal prudence that had held sway since the early 1990's and went back to running chronic deficits. As his obsession with the Iraqi war built the deficits built, but the economy grew (on war and housing). I found of interest, the true propaganda that had infiltrated our American mindset, that in 2008 when the financial crisis came it was NOT considered a crisis of government, but of mortgages and Wall Street. Paulson was able to steal over $500 billion to prop up Wall Street until its demise, after the election, yet was part of the very group that de-regulated Wall Street years earlier.

Regardless of the past politics it is important to note that America was not concerned then about the deficits, yet became concerned as soon as the "Democrats" began spending money. We will soon have the greatest budget shortfall since World War II, where the the GDP will be short a minimum of 11.2% to cover our debt.

In the 1980's economists believed that deficits topping 3% of GDP would bring economic pain. Then came Reagan, who raised deficits above 4% for 5 straight years (in other words, INCREASED our DEBT), and interest rates fell and the economy boomed. It was from this thinking that Shooter Cheney, or economists that "poo poo" deficits, were made.

The key is in this is how we borrow. For years the U.S Treasury Bill and Bond have been the safety and kingpin of economic safety. Solid credit, solid growth, and the U.S. was able to constantly "roll over" it's debt in securities, secured by Japan, China and other countries that were SELLING us product, and still are.

Interest rates rose when foreign countries began to shy from Treasuries in the years that accumulation of deficits approached 50% of GDP. Ross Perot gave us great charts during that time, and interest rates were skyrocketing.

The tech and web boom came, Clinton wisely brought the deficit to 0 in good times, and along came a shift in our priorities with Bush.

The point to this is simple:

1. As long as other countries are willing to finance our debt the charade can go on endlessly. It has in every other country as they developed, or held steady. Money is not real.

2. If countries begin to believe our deficits are not reasonable to our production, that the U.S. is no longer a consumer, there will be hesitancy.

3. As Michael Moore shows in his new film Capitalism: A Love Story a comedic, true portrait of the greed that permeates the implementation of capitalism. Read that carefully. Floyd does not believe capitalism has ever historically worked with equity, but only inequity, which always breeds "a cause and effect" (just like the stock market).

4. Deficits and big government can be the answer. We need to rebuild our country's infrastructure, and clean up our environment, and our impact. We need to put a control in on the rising cost of health care, including the "socialistic medicaire" that is already considered " a right" by our populace.

5. Obama's job is not to reduce the deficit, but to expand our stimulus to stop the capitalism that we let destroy us. Capitalism breeds greed, good or bad, and usually the majority do not gain in a capitalistic cycle.

It is both our misunderstanding of what democracy and socialism mean, and our lack of understanding as a people is appalling. Sure the Fed debt is now at 7.6 trillion, is above 50% of GDP, and is rising.

Sure, we have a bankrupt Social Security and Medicare commitment (debt) that actually is larger than the Federal debt.

6. Little of this happened in the last 8 months.

We had bankrupted our own nation, and for whatever reason and whomever to blame, as Obama took office financially we had hit our moral bottom, and stimulus was the only answer. The capitalists had done it again, and had to bailed out of their own mess, in a specfic sector.

So when you go to "Johnny's Pub" for a beer, a locally owned famlly pub, remember his success is only 1 in 5 small businesses, and that he is the employer of those that spend our money, and allow us life.

Point and Figure Charting Tips

When using Point and Figure charting on any service don’t be afraid to change box size, or to vary how you are viewing it.

Active traders, for example, may want a smaller box size, while a trader trying to see a long range picture with “no noise” will do best viewing a traditional 3:1 ratio chart.

Many traders watch to sell when the bullish percentage on a PnF chart moves above 70-80%, and just begins to reverse down.

If a stock is at it’s highest high and pulls back from a triple top breakout on PnF chart there is a high possibility of a strong pullback.

At www.bluechipoptions.com we often follow a “long tail down” on a Pnf Chart.

A long tail down is a sharp down move in the stock, due to news, or earnings, and if not catastrophic , it’s quite probable to see the stock “bounce back” quickly from the long tail down, for quick profit taking.

We watch for a Pnf Chart ‘High Pole” . A high pole is a move by the stock of more than 3 standard boxes above the breakout price (the pole) and greater than a 50% correction (the high pole)

A high pole is a long string of O’s exceeding over half the preceding column of X’s.

1. A high pole is a warning signal in a bull trend.

2. Analyze whether previous high polls worked

3. Note the high pole often leads to a sell signal.

The tip is: Study point and figure charting

Floyd's Shifty Fifty Portfolio-An Introduction

Floyd’s “Shifty 50” Stock Portfolio

It’s a simple theory. My Dad, as a student and later the only licensee of Richard D Wyckoff, famed trader of the 1920’s, instructed me on the 50 positions he studied and taught, and I began hand charting point and figure charts when I was 10 years old. My Dad was trained in “manage little perfectly” and taught me to be a student of the “specialty” not the “all”.

http://en.wikipedia.org/wiki/Richard_D._Wyckoff

Much like those using Dow theory I work to project the Dow over the short term, and watch sectors for being overbought/oversold.

I believe it is easier to be EXCELLENT at a few things, than “kind of good” at some things.

I do not over read the news or subscribe to financial newsletters that recommend stocks, deciding instead to focus on up to 50 investments, investing in no more than 10 positions at any one time.

Blue Chip portfolios are online, showing the three core categories in which I invest. We are trading together.

Core: These are longer term IRA, SEP, retirement or “buy and hold” investments. Most pay dividends. Only a few are “funds”, as most mutual funds underperform the market.

Speculative: Typically here BCO will short or take long, or buy options; on specific stocks we see as of extreme value (underpriced) OR headed to breakout.

Real $: Gold, silver, platinum, and U.S. Treasury Bills we consider cash. It is often up to 50% or more of our portfolios.

Oil/Energy

Chevron Symbol: CVX

http://en.wikipedia.org/wiki/Chevron_Corporation

Rationale: Chevron has reserves, and a long-term business plan that can environmentally support change, and still profit.

Exxon Mobil Symbol: XOM

http://en.wikipedia.org/wiki/ExxonMobil

Rationale: Exxon is the big ugly. It mirrors the oil distribution/refinery market well

DXO-Crude Oil 2X Bull Fund Symbol: DXO

http://www.powersharesetns.com/portal/site/etns/crudeoil

Rationale: This is a 2 X Bull fund on crude oil. We play this as stock, as it’s quite low priced, and very volatile.

United States Oil Fund Symbol: USO

http://www.reuters.com/finance/stocks/overview?rpc=66&symbol=USO

Rationale: This ETF holds a variety of oil and oil transport issues, and we often trade as a put or call.

ITC Holdings, Inc Symbol: ITC

http://www.itctransco.com/

Rationale: Really study the website sand learn the transmission service this company leads. We think they are the future, and we are trading for the long term.

Oneok Partners LP Symbol: OKS

http://www.oneok.com/partner_default.jsp

Rationale: ONEOK Partners, L.P. is one of the largest publicly traded limited partnerships, and is a leader in the gathering, processing, storage and transportation of natural gas in the U.S. and owns one of the nation's premier natural gas liquids (NGL) systems, connecting much of the natural gas and NGL supply in the Mid-Continent with key market centers.

Sold this position 7/31 for up to $5.00 per share profit. Sector not growing.

Will reenter

Van Eck Market Vestors Coal ETF Symbol: KOL

http://www.vaneck.com/index.cfm?cat=3192&tkr=KOL

Rationale: This ETF invests in over 50% of the largest coal producers across the world, and has a low expense ratio. It’s the perfect way to “play” Coal”.

Healthcare

Shares Dow Jones U.S. Healthcare Sector Index Fund Symbol: IYH

http://www.reuters.com/finance/stocks/overview?symbol=IYH.W&rpc=66

Rationale: Healthcare is “it”. We follow this sector for long term holds, and for puts and calls.

United Healthcare Symbol: UNH

http://www.unitedhealthgroup.com/main/default.aspx

Rationale: United is a terrible company that I hate immeasurably. They’ve destroyed healthcare, and are one of the largest Medical Criminal Corporations out there.

We follow them as a stock, and puts and calls.

Health Management Systems Symbol: HMSY

Rationale: This company provides cost management services for government sponsored health programs. 80% of its revenue comes from Medicaid. It’s involved in 37 state Medicaid clients, and 100 Medicaid managed care plans. With our current health insurance situations it’s a money machine.

http://www.hms.com/

Entertainment

McDonalds Symbol: MCD

http://www.aboutmcdonalds.com/mcd

Rationale: McDonalds builds ugly buildings worldwide, advertises “FAT food” to kids, and serves a terrible product.

Everything about their model of “food crime” is perfect, and we are a long-term holder of both stock, and call.

Their foray into “designer coffee” concerns us, and is the only negative on the stock. Buy grease and little toys.

Disney Symbol: DIS

http://corporate.disney.go.com/careers/who.html

Rationale: Disney is entertainment. They do it right. As America comes from recession entertainment will prosper, and Disney is the perfect “American Dream” company. A very conservative investment long term.

Smith and Wesson Symbol: SWHC

http://www.smith-wesson.com

Rationale: America believes in guns. It’s like entertainment to me, as we must protect ourselves, while we grow fatter. This is my sin stock. Sales and earnings are bound to go up as America arms itself by the TV.

YUM Brands Symbol: YUM

http://www.yum.com/

Rationale: Pizza Hut, Taco Bell, and KFC-it’s simple. Terrible products, horrible for you, and loved worldwide. We’re impressed with their international expansion. They control costs well. We play this as a long-term stock, and put and call.

YUM is often replaced in our portfolio for extraordinary gambling, video, or other entertainment companies.

Important Note: We are NOT sharing a complete portfolio, but showing you the model of our portfolio. Blue Chip Options may or may not have a current holding or position. These are simply stocks we follow.

Join us as a Preferred Subscriber at www.bluechipoptions.com

The Circle of Chaos

The following is an excerpt from some of our work at Floydian Therapy, where Floyd provides a transpersonal psychology approach to the emotions of trading, working with traders via email on personality traits.

http://oexoptions.com/pages/Floydian Therapy.html

There is such a thing as Chaos Theory, and I vaguely understand it. I also know that after entropy occurs there is often new growth. Simply put, once we’ve endured bunches of shit we get used to it and can endure more shit.

At Floydian Therapy we believe there are circles to actions, and that multiple people enter these circles.

Circles of Chaos, and all of us with different abilities to handle chaos; that is, we each as individuals have our own levels of endurance of just how much INPUT we can handle. All we get is input, from voice, to email to TV, and with people. You know the drill. The more you work and are closer to “on the grid” the more you have input.

Your ability to filter this input and how you deal with it defines the amount of “stress you feel”.

Stress is an emotion, not a physical condition. It becomes physiological in response, but begins with brain wave movements, all based on how one is handling input.

When we create or enter drama situations, the circle of chaos is immediate and all pervasive. You have been there, or you are there. Interaction within a circle of certain people is not just interaction, but drama. It tolls on you. This is a circle of chaos, and you are in it.

Most of us spend the majority of our time in the past, or the future. The present is not as real to us, even though we may think it is. We fill the present with “things, events, work, action, and input”, and during that time “remember” the past, or spend more time planning the future. We create scenarios around our FEARS, whatever they are, as we imagine the future, and build our present around what we want to not make happen in the future.

As we “live” we remember what “was” (or our memory of it) and transition what we know to what we are doing, and assimilate more as we “are”. It is during this period of the present that our own circle of chaos begins. We each allow ourselves to live our work, our lives, and be in “dramas’. Most of these dramas do not need to be. Surely, “a brain tumor, or a broken leg” is a crisis, creates a drama. Other dramas that we so quickly enter the circle on only add to our thresholds of input. Every day we have these dramas: Mom needs medicine, Billy broke his toe, John is a meth addict and ripping the family apart, the pharmacy won’t fill the prescription-how you SEE each of these events defines the consequences, by how much drama you allow in it.

There is only so much input any mind or body can take. We each have our overload points. There is the theory of entropy that simply states “the more we handle the more we can handle”, and it drives scientifically into the entire theory of chaos.

Floydian Therapy simplifies this.

Learn where your threshold is. Know when you hit overload. Learn how to stop yourself.

Sorry, it’s that simple. And it is easier to do than you think.

1. Figure out how much you do that you really don’t want to do to, and honestly don’t have to . This is the hard one. We spend much of our lives, I teach, doing what we do not want to do. Some of this we must do. (Clean the toilet, buy food). Some of it we do not have to do (Jerry did this, and Connie did that, and now Mary is mad at Jerry, and they want you to have dinner with Linda with them, and they are all tired of how this keeps happening)

2. Tell everyone you are not going to be in this circle of chaos, and say no. Recognize there are consequences to this decision, as there are to each decision we make, and know in advance how you will ACT, not react.

3. Find what chaos you simply do not handle well. To do this, go outside yourself (the silent witness) and watch YOU, and amuse yourself with what situations cause you chaos, which creates stress. And then, change or do not allow that chaos.

Much of our lives we build endurances. Some of these can be good, as in athletics and building strengths, or being “able to handle more”, but there is a point you must step back from yourself to watch the “input” that you are processing.

The human mind can only successfully process 5 to 6 things at one time.

As we “blackberryize” and “ipod” our lives with new input, with cell phones, and internet, note that this is more input, and that it can add to the circles of chaos that you are part of and create.

The solutions are in identification, and being able to “see yourself” out of yourself.

This method of silent witness is a way to detach yourself from your thoughts and actions to be able to see how you are really acting. It is much like making a list of every single thing you do for a day, something I recommend everyone do. Write down a single day, or better yet, a week, from the morning crap to the phone calls, meals, fights, and what drama took over your day, and how you acted to it.

This is the circle of chaos, of which you control the outset, and must be aware of foremost as a person.

Define your threshold and know your endurance. Work and live to what you WANT.

for more information about Floydian Therapy, contact us at floydiantherapy@gmail.com