X-post on the METAR boardSince I am the ringmaster for that METAR 2013 Contest circus, I might get a little busy at theend of the year. So I thought I would start my Q4 2012 wrap-up. If the Mayans are right, it willbe quite timely, but also quite moot :) Actually, I will focus on some of the items that are notlikely to change much between now, and the end of a normal 2012.So here's where I left off--http://boards.fool.com/hohums-q3-wrap-up-30299130.aspxOctober thru early November 2012 were not very nice for the accounts, especially the Trading ac.Where do I start? Shipping, of course. I had significant lightened my shipping position by theend of Q3. First I nibbled on Nordic American Tankers (NAT). Too early, it fell further. I coulddeal with this one, it was only a nibble. Next came Overseas Shipping Group (OSG then, OSGIQ onthe Pink Sheets now). OSG was the largest US-based tanker company, what I like to refer to as a"tanker biggie". Um, ... that was early Oct 2012, before things went horribly wrong.Q3 is normally an ugly quarter for tanker companies, so I had exited OSG in mid-Sept 2012 about15-16% higher at a small loss. While I didn't think I was getting the very bottom, I figured Icould live with a 15% discount to my previous exit. Ten days later, an OSG director resigns, andthat begins OSG rapid descent down the drain. I knew their management was bad, I just didn'trealize how bad. Company management were in denial initially, but then quickly declared BK.The extent of their rot is only now coming to light.I was taking a walk a few nights ago, and a really nice concept became a fitting analogy.Remember Donald Rumsfeld memorable quote?"There are known knowns. These are things we know that we know. There are known unknowns. That isto say, there are things that we know we don't know. But there are also unknown unknowns. There arethings we don't know we don't know.I had treated OSG as a risky idea with a lot of "known unknowns". In reality, this wasa company with a boatload of "unknown unknowns". It rapidly descended from a $5-$6/sh stockto a sub $1/sh stock. Very ugly! ... But I'm out, and I can take the lessons from this oneand apply it going forward.Some of the new ideas initiated in Q3- Gabelli Utility Trust (GUT) and Excelon (EXC) exited.Lost some capital in both trades. But holding GUT after a dilutive rights offering would havecost more. EXC has the new risk of a dividend cut. Sometimes losing a little now is betterthan losing more than a little later. One replacement has been Omega Healthcare Investors (OHI),a healthcare facilities REIT.Enough of the minus side. How about something positive? Well, Knight Capital Group (KCG)became a holding, then bounced about 37% on recent takeover rumors. I think it is more thana rumor now. Nice idea panning out earlier than expected. I patiently waited for anothertanker idea to announce its Q3 results. As expected, bad results for Teekay Tankers. Badenough for a major dividend slash- down to 2c/sh, from 11c/sh in Q2. Shrugged off the badtaste from the OSG tanker event, and jumped back into TNK. It had been an early Sept exitat much higher levels. I also closed out my Aberdeen Asia-Pacific Fund (FAX) position, an ideathat had worked out quite well for me over the last 3-4 years. A monthly dividend payerwith a healthy payout- keeping an eye on it for a future re-entry.The DRIP ac is supposed to be the steadying account. I set the bar lower- an annual 7.5%return. It has spent most of the year above 5%, and is about 10% YTD. The Trading ac started arecovery in mid-November, now ahead of the S&P, I think. This one will be bouncier than theDRIP ac, so more discussion in part 2.
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