BAC-WT - Bank of America Warrants

[ERICOPOLY]

What is your ratio of Options / Common shares?

 

I have only common shares+puts in taxable holdings, and have a mix of common and calls in my non-taxable account.

 

I won't tell any more because I'm still trying to accumulate and don't want to move the market and further.  Damn this thing is illiquid!

 

If you're still 100% BAC and you are still trying to accumulate, I take that to mean you hold a certain amount of cash in your portfolio.  What % is in cash? And how low do you anticipate letting your cash percentage get once you are all-in?

 

EDIT:  On 2nd thought, you could be holding no cash and be continuing to buy on margin.

 

Onyx1 got the joke.  No, I don't have any cash.  I'm over 100% BAC on a notional basis, but I do have some tucked away in the FOCIX fund and in 529 plans. 

[xazp]

You just have to understand motivations. 

 

-- Most analysts and most mutual funds don't want to get fired, so they basically stay within the herd. 

-- Some analysts (Mike Mayo, but also Chris Whelan, and others) primarily want to draw attention to themselves and necessarily stay well away from the herd (in either positive or negative directions).

-- Most people here just wanna make money and don't have a particular ideological bent. 

 

So when an analyst puts a new price or earnings target at the median of everyone else +/- 5%, or if Mayo goes on TV and says "X is just a crappy company" -- it's all quite predictable to me. 

 

 

 

 

Cynically, I believe Mayo's report was motivated by a trader who wanted to see how resilient the stock is to a change in sentiment.  No meaningful reaction would be his "buy" signal.  The stock being down two pennies this morning would seem to be a reasonable signal that comments from analysts aren't going to talk the price down.  So ironically even a bullish investor could find a report like that very valuable.

[finetrader]

You just have to understand motivations. 

 

-- Most analysts and most mutual funds don't want to get fired, so they basically stay within the herd. 

-- Some analysts (Mike Mayo, but also Chris Whelan, and others) primarily want to draw attention to themselves and necessarily stay well away from the herd (in either positive or negative directions).

-- Most people here just wanna make money and don't have a particular ideological bent. 

 

So when an analyst puts a new price or earnings target at the median of everyone else +/- 5%, or if Mayo goes on TV and says "X is just a crappy company" -- it's all quite predictable to me. 

 

you nailed it man!

thanks!

[onyx1]

 

-- Some analysts (Mike Mayo, but also Chris Whelan, and others) primarily want to draw attention to themselves and necessarily stay well away from the herd (in either positive or negative directions).

 

Agreed, analysts get no attention by staying with the herd, and often at a great cost to their credibility.

 

Just look at page 18 of his report you will see a horrendous string of bad calls.  Mid 2011 BUY recommendations at $14-$17, and 2012/2013 SELL recommendations at $7-$10. 

 

Despite his terrible track record and very questionable conclusion to sell at current prices, Mayo offers some useful criticisms regarding transparency and performance metrics.  I hope the board doesn't dismiss the report entirely but rather uses Mayo's "half-empty" view as a basis for improvement.

[xazp]

It was a little hard to take him seriously when he complained that BAC had blacklisted him from their calls. 

 

Turns out, he was calling the wrong number. 

 

Allegation:  http://www.businessinsider.com/mike-mayo-i-got-censored-on-the-bank-of-america-conference-call-2011-10

Oops, called the wrong number:  http://www.foxbusiness.com/markets/2011/10/20/wrong-number-mayo-not-shut-out-bofa-earnings-call/

 

Every other analyst dialed the right number, but Mayo claims he was singled out. 

 

 

 

-- Some analysts (Mike Mayo, but also Chris Whelan, and others) primarily want to draw attention to themselves and necessarily stay well away from the herd (in either positive or negative directions).

 

Agreed, analysts get no attention by staying with the herd, and often at a great cost to their credibility.

 

Just look at page 18 of his report you will see a horrendous string of bad calls.  Mid 2011 BUY recommendations at $14-$17, and 2012/2013 SELL recommendations at $7-$10. 

 

Despite his terrible track record and very questionable conclusion to sell at current prices, Mayo offers some useful criticisms regarding transparency and performance metrics.  I hope the board doesn't dismiss the report entirely but rather uses Mayo's "half-empty" view as a basis for improvement.

[Kraven]

 

-- Some analysts (Mike Mayo, but also Chris Whelan, and others) primarily want to draw attention to themselves and necessarily stay well away from the herd (in either positive or negative directions).

 

Agreed, analysts get no attention by staying with the herd, and often at a great cost to their credibility.

 

Just look at page 18 of his report you will see a horrendous string of bad calls.  Mid 2011 BUY recommendations at $14-$17, and 2012/2013 SELL recommendations at $7-$10. 

 

Despite his terrible track record and very questionable conclusion to sell at current prices, Mayo offers some useful criticisms regarding transparency and performance metrics.  I hope the board doesn't dismiss the report entirely but rather uses Mayo's "half-empty" view as a basis for improvement.

 

These are very good points.  At some level it's the same as talking about academics.  There are a number of professors who have come out with interesting conceptual points, but when they attempt to apply to real world buy and sell recs it often falls flat (or worse).  It doesn't change though the fact that the points raised are useful to consider.

[Guest wellmont]

Mayo learned long ago that his is not an "analysis" business, it's a sales business.

[fareastwarriors]

It was a little hard to take him seriously when he complained that BAC had blacklisted him from their calls. 

 

Turns out, he was calling the wrong number. 

 

Allegation:  http://www.businessinsider.com/mike-mayo-i-got-censored-on-the-bank-of-america-conference-call-2011-10

Oops, called the wrong number:  http://www.foxbusiness.com/markets/2011/10/20/wrong-number-mayo-not-shut-out-bofa-earnings-call/

 

Every other analyst dialed the right number, but Mayo claims he was singled out. 

 

 

 

That is pretty funny.

[blainehodder]

Article 77 resumes tomorrow at 10 am Eastern. 2 more days of testimony followed by a few days of summation...

 

 

...followed by a settlement approval :)

[value-is-what-you-get]

Article 77 resumes tomorrow at 10 am Eastern. 2 more days of testimony followed by a few days of summation...

 

 

...followed by a settlement approval :)

 

. . . and 126480 Jan 2015 17 calls traded today.  2/3 of open interest in a day!

[fareastwarriors]

Cost of Settling Mortgage Cases Varies Widely by Agency

 

http://online.wsj.com/news/articles/SB10001424052702304868404579194082757174144?mod=WSJ_hp_LEFTWhatsNewsCollection

[ERICOPOLY]

This sounds a bit positive:

 

Lawyers for the bank, the 22 institutional investors and even the judge questioned Levitin's expertise on the customs and practices of residential mortgage-backed securities trustees.

 

"If I think he goes over what his expertise will show, I just won't give it that much weight," Justice Barbara Kapnick said on Thursday.

 

http://finance.yahoo.com/news/last-witness-testifies-against-8-212427897.html

[rkbabang]

This sounds a bit positive:

 

Lawyers for the bank, the 22 institutional investors and even the judge questioned Levitin's expertise on the customs and practices of residential mortgage-backed securities trustees.

 

"If I think he goes over what his expertise will show, I just won't give it that much weight," Justice Barbara Kapnick said on Thursday.

 

http://finance.yahoo.com/news/last-witness-testifies-against-8-212427897.html

 

"I teach about this stuff."  LOL

[Liberty]

http://www.americanbanker.com/people/time-to-rethink-the-term-branch-b-of-as-moynihan-1063663-1.html

 

Seems like a good plan to keep driving cost out of the branches.

[xazp]

It seems like ~93% of bonds are "for" it (or not against), 7% are "against."

 

Imagine a presidential election where one side gets 93% of the votes (including some people switching from the other party).  Then, the supreme court declares the 7% candidate the winner.  Riots, right? 

 

 

 

This sounds a bit positive:

 

Lawyers for the bank, the 22 institutional investors and even the judge questioned Levitin's expertise on the customs and practices of residential mortgage-backed securities trustees.

 

"If I think he goes over what his expertise will show, I just won't give it that much weight," Justice Barbara Kapnick said on Thursday.

 

http://finance.yahoo.com/news/last-witness-testifies-against-8-212427897.html

[Guest Dazel]

 

 

Ericopoly,

 

Thanks for driving the price up again we bought on the last pull back in a big way.

Keep it up!

 

Dazel

[ERICOPOLY]

 

 

Ericopoly,

 

Thanks for driving the price up again we bought on the last pull back in a big way.

Keep it up!

 

Dazel

 

 

Sometimes I'm paranoid that the fund managers at Fidelity are tail-coating me (and I'm a tail-coater too).  I too increased my BAC around $13.90.

 

I know that sounds moronic to say, and egotistical, but there have been a few coincidences like this.

[LC]

You might be moving enough volume to trigger some of the more potent momentum algos. Not sure about Vanguard or Fidelity...but if that were in fact the case, what a compliment!

[fareastwarriors]

I wouldn't be surprised if there are some analysts working for a big fund lurking around in here. The result speaks for itself!

 

[hyten1]

i am a tail-coater too, i increased my bac position by 5% (a small way)  2 weeks ago

 

 

 

Ericopoly,

 

Thanks for driving the price up again we bought on the last pull back in a big way.

Keep it up!

 

Dazel

 

 

Sometimes I'm paranoid that the fund managers at Fidelity are tail-coating me (and I'm a tail-coater too).  I too increased my BAC around $13.90.

 

I know that sounds moronic to say, and egotistical, but there have been a few coincidences like this.

[rkbabang]

i am a tail-coater too, i increased my bac position by 5% (a small way)  2 weeks ago

 

 

 

Ericopoly,

 

Thanks for driving the price up again we bought on the last pull back in a big way.

Keep it up!

 

Dazel

 

 

Sometimes I'm paranoid that the fund managers at Fidelity are tail-coating me (and I'm a tail-coater too).  I too increased my BAC around $13.90.

 

I know that sounds moronic to say, and egotistical, but there have been a few coincidences like this.

 

I didn't put new money in, but I rearranged my BAC exposure, increasing my leverage further from an already highly leveraged position.  I no longer own any of the warrants, I sold my warrant position and put it in mostly Jan2016 calls and some common.  I continue to hold my Jan2015 calls. My portfolio has done really well the last few days.  I also increased my AIG warrant position under $20, but that is still only about a 10% holding, BAC has grown to over 60%.

[fareastwarriors]

4.13%+ for A warrants

vs

0.78%+ for the common

 

 

who was loading up on A's here...

[MYDemaray]

Supposedly, JPM just settled for $4.5bn on $95bn face in another Gibbs & Bruns spearheaded lawsuit with the Investor Group.  Recovery was 4.7% vs. the recovery of 4.6% for them in Countrywide.  JPM presumably had no successor liability issues (didn't see if these were Bear and/or WaMu issued, so maybe more there).  But, seems like a very good data point for the Article 77 hearing to say...if investors were screwed in BAC settlement, why did they agree to same terms again without all the complicating factors?

[vinod1]

Supposedly, JPM just settled for $4.5bn on $95bn face in another Gibbs & Bruns spearheaded lawsuit with the Investor Group.  Recovery was 4.7% vs. the recovery of 4.6% for them in Countrywide.  JPM presumably had no successor liability issues (didn't see if these were Bear and/or WaMu issued, so maybe more there).  But, seems like a very good data point for the Article 77 hearing to say...if investors were screwed in BAC settlement, why did they agree to same terms again without all the complicating factors?

 

BAC offered $8.5 billion to settle $409 billion of original balance (outstanding balance as of Q3 is $112 billion). So it is about 2% recovery. Am I missing something?

 

Vinod

[MYDemaray]

Vinod...maybe my figure was incorrect.  I was using the sum total of the loan balances provided in Lin's RRMS report (last page):

 

http://www.cwrmbssettlement.com/docs/Opinion%20Concerning%20Contemplated%20Settlement%20Amount%20For%20530%20Trusts.pdf