Mainly to spend more time with my girlfriend, I took a job based in Shanghai, China, starting August. I expect my stay there to be around one year. In the meantime, because I was told that blogspot.com may be blocked from Mainland China, I'll switch to http://bpm4u.blog.tianya.cn/ for the time being.

For the past few weeks, dollar has rallied and commodities have been under pressure. I don't know whether this is a trend, especially when the US housing market is still in a terrible situation. When ommodities price ease, so does inflation pressure, and the Fed will have less incentive to up rates, which is USD negative. I'm currently long on EUR/USD.

My stock portfolio now contains CVTX, MO, HAL, OI, BP, C, SWN, SGP, PEP, MCD, HGM, EPD, WM, BE, FNM, and ChalCo. FNM may be in dire situation, which is also USD negative. PEP is more of a hedge on lower energy prices. RTN and MOT were closed when the underlying calls got assigned, turning a profit.

On a day when the DOW is down 1.68% and the Nasdaq 2.24%, my portfolio is down 1.06%. But it has turned negative for the year at -2.4% (vs. Cramer's -6.6%, and S&P's -7.3% YTD).

I sold 1 quarter of my PM position today which went up, and rotated some of the proceeds into more MO which came down. They are in the same industry but Cramer thinks MO is a better value. I'm sort of blindly following Cramer on this one, as both are defensive in nature. MO does have a higher yield, but the US domestic environment is more hostile. So we'll see.

I also bought some BE at $1.3, and more OI at $51.2. My view on BE has not changed and will look to sell after a 10% bounce.

Financials took another bath today and WM is hovering around $6 now. WM has obviously turned out to be a bad buy for me, which I should have sold earlier. But at $6 I simply cannot sell it. WM isn't likely to go under, but I don't think it will top $12 by the end of the year.

Current holdings are: RTN MOT HGM CVTX SGP OI MCD MO PM BP HAL EPD C WM FNM BE

Can't believe it's June already... Today the equity markets took a bath, down about 3%. The NFP job report was weak, and oil surged to record high.

My portfolio went down today 2.1%, quite a bit better than the market. I took this opportunity to add to a couple positions (MO, MOT), and closed a leap covered call in MCD. I started a position in MOT recently, hoping it will be a turnaround story, with Icahn bugging the management, and the imminent mobile phone business sale. I tried to think if I was being sentimental about this buy (I interned at MOT when I was in college a long time back). I'd be lying to completely deny it, but with all the bad news already out there, maybe MOT has bottomed around $9. MOT pays a 2.2% dividend at the current price level, although honestly I'm not sure if it will be cut.

I'm lucky to have closed out BE yesterday for a good 10% gain over two days. BE is also a turnaround story, but until it turns in a positive quarter (or provides very positive guidance), I'm just going to trade it. HP is going to buy EDS, which is negative for BE. One would think at this price (market cap 300M + 900M debt) and a revenue of 3.3B, it would be a great acquisition target, but so far nothing has happened.

This week I've done quite well on the forex market, realizing a gain almost 180% of my monthly target. I played the USD long correctly, and exited before the trend reversed today.

My stock portfolio now consists of: MOT HGM CVTX SGP OI MCD MO PM BP HAL EPD C WM FNM.

The biggest winners are still energy and the biggest losers are still financials. Given that the Fed has signaled a rate-cut pause, the recovery of financials will likely take even longer. The problem is I'm in so deep, taking a loss now might not be a good idea. Other than WM, C and FNM both pay a decent dividend. And I'm not sure where else to deploy the cash, even if I have taken a loss there.

I rotated out of F-S into HGM. Both preferred stocks in the autos. I recorded a 10% gain in F-S, and think GM is a better international bet than Ford. HGM pays about 12% dividend currently, and is certainly another turnaround story.

Last week's Sapphire felt smaller and quieter than in last year.  Perhaps the economy is taking its toll.  SAP formally announced Galaxy, its yet another BPM tool.  Its attempt to expand in the SME market through a SaaS based offering has been quite unsuccessful so far, but it will keep trying, I'm sure. 

HP announced a planned acquisition of EDS.  If that goes through HP will be a solid #2 behind IBM in IT services.  I think it's a great idea.  The problem is my limit buy order didn't get filled before HP's quarterly numbers came out today, and I don't feel like chasing it.  I bought some PEG today as a defensive play.  It should benefit quite a lot from the run-up in oil and natural gas prices, and its nuclear power generators.  And as a typical utilities firm it pays a good dividend (~3%). 

One stock I've been looking at (and traded several times) is BE, formerly KPMG Consulting. This looks like either a turnaround story or a dead cat.  I'd be willing to take some risk at $1.5/share.  It just lowered the full year guidance which caused some downgrades from analysts. But it's a multi-billion dollar IT services business.  I find it hard to believe it would go busted.  Worst case perhaps it will be acquired.

Economic data released today sent mixed signals but the US market seemed to see them as a glass half full, and went up across the board. Well, across the board except for oil and gas.

My oil holdings (BP,HAL,EPD,PWE) all went down today, which dragged down my overall portfolio performance (+ .71% vs. S&P +1.48% and Nasdaq +2.81%). Financials (C,WM,FNM) had a good day. New addition OI released a great quarter but predicted a challenging outlook, and stock went down. I scaled into OI before the quarterly report following Cramer, which apparently hasn't quite worked out. I do like OI's potential though, in that it has great pricing power, and glass containers are much more environmentally friendly than plastic. I will hold OI for another quarter before deciding what to do with it.

Ford's small cars sold very well (e.g. Focus) but overall sales went down. No surprise that people aren't buying big trucks at the current gas price. F-S still edged up at this news.

I recently am itching to replace my Motorola L2. I can use google mail and maps on it but the small screen and the slow speed make it, well, not that fun to use. I feel attracted to an iPhone, but I don't really want my phone to stand out in a business meeting. Outside of the SF Bay Area, I have rarely seen business people with an iPhone. Plus, I think I would feel guilty spending more money on a mobile phone than on my Mom's new laptop. To be fair, though, phone prices haven't gone up. I spent about the same amount on my Treo 600 years ago, which was a less capable and slick device than the iPhone. It's just, the laptops are so much cheaper now, and I have a wireless access card. Maybe I should just go with a Samsung Blackjack II, which is a capable smart phone, at a reasonable (much lower than a laptop) price of $99.

I've had to fly coast-to-coast twice this month so far for work, and am glad I woke up this morning at home.

I meant to trim my position in MSFT yesterday before its quarterly announcement, but I wasn't able to do so due to travel. MSFT missed but I was able to close my position today with a small profit. The YHOO saga is not over yet, but I'd like to switch to another name before it announces on Apr 30, following Cramer's advice. That name is OI (Owens Illinois).

CVTX received another piece of good news this week. The European Medicines Agency has recommended approval of CVTX' Latixa, and the EU is now expected to endorse this approval in the next couple of months. CVTX is now above my cost basis, but I expect it to double within the next 8 to 12 months. Of course, if it gets acquired, the doubling will happen much sooner.

Ford had a positive surprise for the quarter and my preferred stock (F-S on Google finance) is up a nice 15% now from my cost basis. And this does not count the ~11% annual dividend it pays (relative to my cost basis). Now I regret not having bought more. But I viewed it as a very speculative play, and it's not a bad idea to be prudent.

I noticed that my portfolio has turned positive for the year today (2.5%), which is good. The S&P and Nasdaq are still both negative. I however expect some profit taking next week and therefore a minor pull back. I may set up some short positions accordingly over the weekend.

I will have to fly to the East Coast again in early May for Sapphire in Orlando, but until then I expect to be able to stay put at home, working on a few proposals and accounts.

CVTX just sold half of its North America royalties for the recently FDA approved drug (Lexiscan) to TPG for 175M, and the stock is up more than 20% after hours. I think this is a very balanced move. CVTX is not giving up all the upside by selling only 50% (note it still owns 100% of the marketing rights outside the U.S.), and yet it's getting sufficient cash for its debt obligations due in year 2010. I still think the bigger upside will come in the summer. The timing of this 20% jump however is not that perfect for me as I sold covered calls ($10 expiring this Friday) a week ago when the price was less than $7.5. I may see my calls assigned this weekend (happily, btw). If that's the case, I'll probably rebuild a position in CVTX in anticipation of the summer FDA approval.

WaMu's numbers today are largely inline with expectation, and the market even moved its price up almost 5% (including after hours). This gives me more confidence that the bottom is near, if not already here. I'll hold on to my WM shares for now.

After a busy week out of town, things have slowed down a bit. And weather has become much warmer.

One of CVTX's drug applications was approved by the FDA last week. Even though the price hasn't moved up in response, I'm confident it's helped put in a solid support. CVTX already sold the North America marketing rights of this drug to Astella, and will receive royalty payments as a result. The major catalyst to this stock will remain the FDA approval of CVTX's current drug for first line use, expected in the summer.

I bought puts on WM after its big run-up in response to the TPG cash infusion. I may have sold the puts a bit too early as the stock went down another 4+% today. I believe however WM has a limited downside at around $10/share. Depending on tomorrow's quarterly earnings announcement, I'll decide whether I want to take the loss in my long WM position. Unlike C and FNM, WM has recently cut its dividend to almost nothing (1 cent), so I may not want to hold on to it for a recovery.

FWLT looks over sold during the last few sessions, and I bought some Aug 62.50 calls today. At this point I'm long on AUY, ACH, BP, C, CVTX, HAL, MO, PM, MSFT, SGP, WM, MCD, EPD, PWE, F-S, and FNM. My portfolio's year-to-date performance is -3.2%, much better than S&P500 (-9.3%), and Cramer's portfolio (-11%). However I still don't like it, because it's negative.

I spent some time again at the de Saisset museum at Santa Clara University this afternoon. Some 1960s works are on exhibition there. What caught my attention the most, though, was the cell phone based audio playback mechanism. Rather than hand out a playback device with a number keypad, visitors are asked to call a phone number and enter the corresponding key. A simple IVR system does this, but I wonder why I haven't seen it elsewhere.

The Asian stock markets took a nosedive again on the first trading day of the week. German export number for January however beat expectation by a wide margin despite the strong euro. I'm long on ACH, AUY, MO, MSFT, BP, HAL, EPD, FWLT, CVTX, SGP, MCD, and, unfortunately, C, WM, and FNM. I believe the three financials I own will come back, except possibly WM, which could be acquired for a cheap price just like Countrywide. I prefer WM to remain independent, as I think its savings business is strong and the Fed's rate cuts will eventually help turn it around. In the meantime, the financials' dividends are decent. I apparently got into the financials too early in the cycle. Next time around, I should give it some more thoughts before acting.

I renewed my subscription service to Jim Cramer's ActionAlertsPlus.com. I signed up with him initially for a few reasons. 1) He was very successful running his own hedge fund; 2) He still runs a charity portfolio, of his own money, successfully; 3) He seems to know what he is talking about on CNBC. Putting your own money where your mouth is is important, imho, for those who make a living out of managing other people's investment money.

I sold ENTU after its recent run-up, but CVTX will likely take longer to rise to its true value. It has several phases II and III applications with the FDA and/or the EU. In the meantime its sole FDA-approved drug is selling relatively well, offsetting a large portion of its expenses.

MSFT dropped further with the overall IT sector, while YHOO moved up. YHOO's board rejected MSFT's offer. It seems the market believes this deal will eventually happen, and probably at a slightly higher price from MSFT. I continue to believe that MSFT doesn't deserve to go down due to this offer and will continue to hold the shares I bought the day the $31/share offer was announced. Based on what happened with Oracle's offers for PeopleSoft, Siebel, and BEA, the final price could either go up, or down, primarily based on the target company's financial performance in the interim. I don't see any obvious catalyst improving YHOO's performance in the near term, although as a Valley resident I do hope YHOO will do well (and that MSFT will drop its offer, sending MSFT share price up.)

Microsoft announced an unsolicited offer for Yahoo last Friday. I first longed Yahoo because its market price was $2 below MSFT's offer price. I soon closed the position for a small profit and longed MSFT instead, which was down almost 10%. The risk/reward ratio for YHOO just seems much higher than MSFT. This move would almost surely help MSFT in the long run, and if the offer was turned down by Yahoo or the acquisition was rejected by the regulatory bodies, MSFT would almost surely see a short term bounce.

The consolidation tide continues in the software industry, with Oracle leading the way so far. MSFT would top Oracle in total amount if this deal were to go through. Who is still around standing alone in the Valley? Tibco, VMware (still majority owned by EMC), Intuit (MSFT tried to acquire it earlier but failed), Adobe, Salesforce.com, and NetSuite.

I wouldn't be surprised if in a few years there are only Microsoft, Oracle, SAP, IBM, HP, and, who else, Google, left as legitimate players in the enterprise software market.

With the recent introductions of Unbreakable Linux, and Oracle VM, Oracle has effectively completed its software stack. Anybody who says Oracle is just a database vendor is just, well, outdated.

SAP has been growing a lot more slowly than Oracle in applications license growth, and its NetWeaver platform, although improving steadily, is probably never short listed unless a customer is already running SAP applications. But it's still twice as large as Oracle in apps market share even after Oracle acquired PSFT and SEBL, and we all know that install base is mostly gonna be there for the foreseeable future.

HP's acquisition of Mercury Interactive seems to have made a lot of sense. Systinet seems to be the market leader in SOA governance. Will HP screw up Mercury? It might. Will Sun screw up MySQL?

The top 3 BI vendors have been gobbled up recently. Who's next? BPM and BRM vendors?

My recent experience with Zecco Trading, a "zero commission online brokerage firm," has prompted me to close my Zecco account after transferring out everything in-kind. Zecco is yet another example of a startup that provides an unreliable product along with terrible customer services. Since Zecco deals with customers' money, such gross sloppiness is absolutely unacceptable.

I signed up with Zecco shortly after it's debut on CNBC. I was unimpressed with the website's features, but those free trades were certainly appealing. In addition, having been involved with
a few startups, I wanted to give Zecco more time to develop. I even referred a couple friends who later signed up with it. Probably because I was one of the first customers it got, I was invited to sit on its customer advisory board, which consisted of I think about 12 people. The company held two conference calls with us, where we raised a lot of issues and feature requests. It suffices to say that none of my requests have been worked out, after more than a year. The Zecco app has a 10 minute session timeout. I wanted it to be longer, or more user configurable. Zecco said it was too hard to synchronize the timeout with its backend trading system from Penson. Another issue is that the investment records for downloads don't include dividend payouts. By the way, the customer advisory board went dormant after the first two calls.

Although I didn't give Zecco up for such "inconveniences," over time I grew quite irritated by the site's unreliability. Sometimes I wouldn't be able to login. Another time I couldn't sell a holding called NYX, and it turned out the recent NYSE/Euronext merger confused Zecco's system. By the time a customer rep from Zecco called me a few days later, NYX had already dropped a few points, and I changed my mind. Recently, another holding of mine was acquired, and Zecco's system showed a zero cost basis for the new ticker symbol (PWE). I had to call them to have my cost basis updated. The issues list goes on...

And what really put me off tilt, to borrow a term from poker players, was Zecco's star customer service team. Zecco doesn't provide a secure messaging system for customers to email them with, instead one has to email, in plain text, a generic customer service address.

Anyway, to make the long story short, I closed my Zecco IRA account in Nov. 2007, when Zecco unexpectedly charged me a total of $70 (so much for zero commission...). Recently I was thinking about closing my regular account as well, but I decided to first find out how much it would cost me to close it. I emailed Zecco my questions. I got a reply from a rep saying I was over charged by $20, and that a fee reversal request was put in for me. I thought, OK, at least they were honest. The next day I received another message saying that they put in a request to close my regular account. I was very confused, as I never asked to have it closed. Besides, there are positions in the account. What is Zecco gonna do about them? I certainly don't want them liquidated. I emailed back, in no uncertain terms, asking them not to close my account. One day later, I received an email apologizing for the confusion, and saying my account would not be closed. The same evening, I lost access to my trading account... I'm now trying to transfer out of Zecco just as quickly as I possibly can.

Morale of this true story. First, you get what you pay for. Second, most startups are unfortunately very sloppy and provide terrible products and/or services. Third, you should avoid a startup, in terms of seeking a job or doing business together, if you feel its employees are below-average and don't know what they are doing. There is a limited number of competent people out there available for hire, and if a startup can't get some of those while it's small, it won't get any of them if it ever manages to grow bigger (and that growth probably would have been achieved by burning investor money anyway.)

Stock markets around the world have been very volatile recently, and I'm getting into a few highly speculative plays. ENTU and CVTX. Both have a product (or a few products) that are selling. Both are very small cap. And both may be acquired by larger players in their respective industry.