Friday, October 5, 2007

Roth changes, CRDN a buy

I have a new idea to changes in my Roth that I may implement in paper trades for awhile...and if it's successful implement into the Roth. DITM calls, just one per stock, for some high growth stocks. I'm talking about stocks like GRMN, GOOG, ACH, CEO...any stock within the high growth category. DITM will allow us to pay less of a premium for the stock and capture all the movement...allowing us to control 100 shares of stock at a much lower price. The reason I want to implement it in ROTH is because this is money I have put away that I do not intend to take out or need until I'm 60. I am now 23, so I have 37 years to recoup serious losses and when you are young is the time to be the most aggressive.

My Roth currently consists of USCGX, a large cap growth fund which year to date has performed well, and USSCX, a science and tech fund. I was considering dropping USSCX, giving me 4400 for the strategy. I want to buy two DITM calls for at least may 08 if not jan 09. With the remaining money I want a bank with a high dividend and moderate growth to baseline the portfolio. I think this combination will yield a better return than what I currently expect out of USSCX.

One of these calls may be CRDN. Watch out, CRDN is en fuego again. I owned this long ago at around 55...then sold it at 60. From there I watched it go to 83 then drop back down into the 70's. I grabbed 10 shares at 67 a few weeks back, expecting it to retreat more. CRDN does many things, but the biggest reason for my investment is their growth, particularly in the MRAP (Mine Resistant Ambush Protectant) II vehicles they are producing. These are uparmored vehicles that are used to help soldiers combat terrorism and are the biggest protectant against IED's. Now phase 1 of all MRAP I's is over, and CRDN received 0 contracts for MRAP I and bowed out of the race early to concentrate on MRAP II. Now CRDN has teamed up with Ideal Innovations and OSK, which I also own 40 shares of, in MRAP II...and has sent 2 vehicles to Aberdeen Proving Grounds. I have raised my reentry point for CRDN from 73 to 75...and I easily see CRDN breaking par by the end of the year. I would seriously consider a DITM for CRDN, but have yet to research which companies I want in my Roth revamp.

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