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Author: altstrat91 One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 35269  
Subject: Re: good time to get rid of some stuff & TLT/SHV Date: 1/17/2013 8:30 AM
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Charlie,

as you know there is really no where to go on the internet to have a quality discussion on corps. this is really the only place i could ever find. i actually am pretty stealth when it comes to personal data but i got caught up a little bit in that thread between you and howard regarding AUM and what your max % wise is on a particular position by disclosing my particular numbers.

i have a few folks i can have decent discussion with in person. but majority of them find bonds boring and only want to talk about high beta movers, small float micros, or futures. i do know someone though that is going in heavy on these genco bonds. remember, my entry point price here on genco is 60 cents on the dollar, so cost basis wise, i would only be at $150K on 250 bonds, which is around 10% of AUM for my active trading account.

i think part of the genesis that is driving me on this trade is a bit of regret from a previous missed opportunity with patriot coal. when they announced BK, i did a terrible amount of research on their asset coverage, logistics, etc. both fitch & S&P had their recovery rating in the half par range. their senior bonds tanked down to the $30's upon BK announcement. so they were in tremendously oversold unknown territory.

after all was said and done, and scoping out their prospects, i was literally a mouse click away from taking out 500 of their bonds @ 37 cents on the dollar. so close, but ended up chickening out. as you pointed out, why did i not consider just taking on a smaller position? i did not. even if i grabbed 20 or 50, at least i still would have caught some of the action. then in short time after, the PCX bond ended up migrating to where their recovery rating range is at the $48-$49 handle. i was pissed to say the least.

so what i really need to do is re-evaluate my emotions and see just how much of that patriot coal trade is driving me here and/or clouding my judgment. the worst thing you can do as you know is a revenge trade. i will still scale in here on genco to add to my current small position, for a block of 25 more in the 60 cents range and see where the price action goes.
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