No. of Recommendations: 3
I'll be following my grandpa's portfolio in my newsletter becuase he'll be subscribing so I decided to follow my portfolio here, this is a real money portfolio, all of my money is invested in it.

As of late I've been taking to arbitrage and it's potential gains, I have a relatively small position in this portfolio, a porfolio of my size is prob the only size it would help.

Because of a recent deposit this portfolio is valued slightly over $5,000 at $5,173.10 I don't really trust the TMF portfolio tracker -- dividneds aren't counted -- so every month I'll just use the current balance to calcualte gains and losses.

K-Swiss

K-Swiss is my favorite position, I love the business model and personally only buy their shoes. A lot of analysts are looking down on K-Swiss, last quarter - y-o-y - K-Swiss' Euro revenue grew 103%, Gwen Stefani has a contract with their royal elastics brand which has yet to give them a profit, but I believe Royal will have a big impact in the future.

Right now if you wanted a 15% CAGR from a K-Swiss investemnt over the next 10 years K-Swiss would need 14.7% earnings CAGR, I believe they will achieve that and value them about 30% over today's price of 30.64.

KSWS $30.64 $704.72 38.62%

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Pfizer

Pfizer is the first company I bought stock of, I didn't do any analysis at first, and bought at an extremely bad time, it hasn't been a very good investment so far, but I believe I'll be able to add shares and hold onto it for a long time.

The price has gone down recently because of the Merck trial, I believe it would be a good buying point but my cost basis already puts it at almost 20% of the portfolio so I'll just watch from here.

PFE $25.48 $764.40 -19.73%

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Faro

I bought this after reading about it on the HG boards, I thought I bought it at a good valuation, appearently not.

This also a great long term hold -- as I think most of my positions are :-) -- and Tom Garnder seemes really enthusiastic.

So far Faro is the worst performer in my portfolio.

FARO $20.65 $474.95 -28.28%

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Paxar

Paxar makes those annoying little tags on the back of your shirt, and they're pretty good at it to.

I got Paxar from Bill Mann in HG, he says that right now they're valued so you get the tag business, and the RFID business for free.

PAXR 18.81 $545.49 4.26%

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Fairmont Hotels

Also got this one from Bill Mann who says it has valauble real estate that is worth ~ the current price.

Hasn't done that well for me so far, but I'm confident it will.

FHR $31.38 $502.08 -13.07%

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Freescale Semiconductor

Freescale was spun-off of Motorola, David Einhorn believes they were undervalued at $17.05, currently they're at $23.88 and I'm goin to re-evaluate my position.

FSL $23.88 $620.88 34.1%

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JB Oxford

I saved the best for last.

Currently JBOH represents about 3.5% of my portfolio, it's the smallest position, but it has to be that way or I don't profit off of it.

JB wants to split 100-1, which means for every 100 shares you own it gives you one, they are doing this so they won't have to make periodic reports to the SEC.

In order for me to profit off of this split I have to buy less than 100 shares, they are paying $2.96 for every fractional share you own. If I bought 100 sharse I would own 1 whole share - no fractioanl shares.

I bought 99 shares in a limit order that was executed on Monday, I bought my shares at $1.85 per share. This month when they will split and I will get $2.96 for all of the 99 shares I own, since I paid 1.85 per share this will be a gain of about 60% in one month, not that shabby.

The catch is the restriction of buying only 99 shares, this means it can only represent 3.5% of my portfolio for me to get maximum profitability, next month I'll probably have a few more positions similar to this.

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15% of my portfolio, $770, is currently in cash, I believe in being fully invested and will be trying to find new positions for a lot of my "investing time" over the next month.

www.fatpitchfinancilas.com is a great blog for value and arb investing, I've sarting reading it every day and reccomend it to everyone.

-Mike








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