Smart Stops

This post is based on an email I received from the SF IBD Meetup Group (most of it is copied verbatim)

There is a new startup company called SmartStops.net, that helps investors know when to sell.

Their solution is based on facilitating and optimizing the use of stop loss protection and making it easier for the investors to take protective action. At the end of each market day, they publish an updated SmartStop for each covered stock calculated for use the next trading day. If the stock falls and triggers its SmartStop, it is an indication that the stock has entered a downtrend and it is recommended that you sell the stock or take other protective action.

They monitor their member’s portfolios continuously and email them when a SmartStop is triggered. If you receive a SmartStop QuickAlert – Take Action.

Their algorithms are designed and maintained by Chuck LeBeau, a well regarded author on technical analysis. Their stops move closer to or further from the stock as trading patterns dictate to keep you in up-trends longer but exit you early in down-trends. Their stops are designed for investors more so than active day traders. They do not hug the stock close enough to trigger daily trades and do not adjust intraday. However, traders, as we know are information hounds and many day traders are early adopters of their solution.

Recent articles in Barron’s, Kiplinger’s, WSJ, Fortune and The Street.com can be found at:

http://smartstops.net/PublicPages/Press.aspx

They are always looking for feedback from experienced investors. A guy I know who works with them spoke with the CEO and he would like to extend a free trial offer to the IBD Meetup group.

The IBD Meetup Group Code Is: IBD90FREE.

This code will give all members 90 days free SmartStops Portfolio Protection Service at the 10 or 20 stock portfolio level.

Microsoft & Yahoo …. is it gonna happen?

Check here. Jerry Yang is suggesting that Microsoft buys Yahoo. Looking at their market quotes today, the are both at:

MSFT 21.63 -0.45 (-2.04%) 192.41B
YHOO 14.45 +0.53 (3.81%) 20.02B

Yahoo went up more than $0.50 after Yang announced that Yahoo is up for grabs again. Yahoo’s 52 weeks low was $11.25 and Microsoft 52 weeks low was $20.65. This is an opportunity to make some cash in a depressed market, however, knowing that the market is headed for worse times, I wonder if this deal would happen now. Microsoft initial offer to buy Yahoo earlier this year was valued at $33/share. Yahoo is much cheaper now and MS still got the cash. MS could even do a share for share matching deal buying Yahoo at $21.63/share which would be a premium for Yahoo’s value right now and fitting to MS. I don’t think Yahoo can argue a price in the $30s anymore given the economy and their failed attempt to collaborate with Google. Reuters said the following:

Shares of Yahoo surged after a report surfaced online that the Web pioneer’s Chief Executive Jerry Yang was leaving the Company and that Yahoo was in late stage talks to sell the whole company to Microsoft for between $17 per share and $19 per share. Speculation about a possible deal between the two companies intensified after Google Inc scrapped plans for a Web search advertising partnership with Yahoo.

I would wait until we can find out more about MS’s real intentions. Off course you could take a risk and buy Yahoo now, let me know what you think.

How to deal with downturns in economy if you are a startup

Sequoia Capital held a meeting a few days ago with all of its portfolio companies, telling them how to adjust to current economic conditions. Somebody leaked the slides from the meeting (see link below). Very interesting. You have to get to slide 37 for anything resembling a hopeful message (Amazon.com and Salesforce.com’ s successful growth during the downturn of the early 2000’s).
Check here for the slides
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I also embedded the slides here: