Thursday, October 23, 2008

Why I bought even more First Marblehead (or why I'm a glutton for punishement)

After I sold my Canon shares and put money down for a house, I had some cash left over. Today, I used that cash to buy First Marblehead at $1.42 a share. That is less then 10% of what I paid for shares way back in February. In the meantime, the credit markets have fallen apart, TERI has filed bankruptcy and First Marblehead has slashed the accounting value of its trusts.

Even so, I think the company is an even better buy than it was nine months ago. The liquidation value has fallen to about $4 a share, so the market has priced in a considerable chance of complete failure. Further, the residuals are priced as if they are extremely risky—they must be discounted at 25% yield in order to get a $1.42 price. I've been greedy all the way down, so I'm not the best person to ask. On the other hand, there just don't seem to be any more shoes to drop.

One thing I know, this market makes me feel really dumb.


Anonymous said...

You really make it seem so easy together
with your presentation however I in finding this topic to
be actually one thing which I think I'd by no means understand. It kind of feels too complicated and extremely vast for me. I'm
having a look ahead in your subsequent submit, I'll attempt to get the hold of it!

Also visit my web site - how to make money fast online
My page - make money online fast and free

Anonymous said...

Piece of writing writing is also a fun, if you be familiar with after that you can write if not it
is complex to write.

Here is my web-site binary options calculator
Also see my webpage - after hours trading Wiki

Anonymous said...

I used to be recommended this blog through my cousin. I am not positive whether this publish
is written by means of him as no one else realize such specific about my problem.
You are amazing! Thank you!

Stop by my website free grant money for college students
Also see my web site: free money website

Anonymous said...

I just could not go away your website before suggesting that I really enjoyed the usual info an individual provide in your
visitors? Is going to be back regularly to check up on new posts

Stop by my blog - how to make free money online

Anonymous said...

Thanks a lot for sharing this with all people you really realize what you are speaking approximately!

Bookmarked. Kindly additionally consult with my web site =).
We will have a hyperlink exchange arrangement among us

Look into my web site ... tester werden und geld verdienen
my website: schnell geld Verdienen