It has been a few months since I’ve reported on my Special Situations Real Money Portfolio.  The Special Situations Real Money Portfolio is actually my son’s Coverdell Education Savings Account that I set up on October 19, 2004 as an experiment.   I wanted to see if an individual investor could earn stable returns from special situations and arbitrage opportunities similar to the opportunities Benjamin Graham called “stock workouts.”  The experiment has been a huge success and was the motivation for me to create my premium service, Fat Pitch Financials Contributors Corner.  Even though it has been a while since I’ve publicly discussed the Special Situations Real Money Portfolio, I’ve been busy investing in new opportunities all summer and the results have been phenomenal.

When I last reported on the Special Situations Real Money Portfolio in April, the portfolio had a balance of $34,683.37. By then end of May 2010, the portfolio’s value increased to $35,026.44.  After the market closed on August 31, 2010, the portfolio has grown to $37,421.88.  That’s a gain of 7.9% since the end of April.

So far this year, the Special Situations Real Money Portfolio has gained 20.96%.  That is particularly impressive given that the S&P 500 index returned -4.6% over the same period.

Since inception on October 19, 2004, the Special Situations Real Money Portfolio has produced a total return of 211.85% (as of August 31, 2010).  The average annualized rate of return for this portfolio continues to be an impressive 31.09%.  This is just slightly lower than what I reported at the end of April.

Of the current $37,421.88 in the portfolio, I only held $3,805.31 in cash at the end of August. Yesterday, I invested almost all of that remaining cash in a new liquidation opportunity that I recently shared with subscribers of Fat Pitch Financials Contributor’s Corner. Find out my latest move by subscribing to a one year membership of Fat Pitch Financials Contributors Corner. Use the coupon code FPF10 to get $10 off an annual subscription purchased by September 3, 2010.

Over the next few days I will be detailing the results of all my recent trades that have resulted in my current 21% gain so far this year.  Stay tuned by following the Fat Pitch Financials RSS feed or signing up for free email notification.

Welcome to the August 9, 2010 edition of the Festival of Stocks. The Festival of Stocks has been on vacation for the past few weeks, but it is back in action this week with an extended edition. The Festival of Stocks is a blog carnival dedicated to highlighting bloggers best posts on stock market related topics. Fat Pitch Financials is the actual birth place of this online weekly event, so it is always a special occasion when I get the chance to host this roving event.

If you aren’t already familiar with my blog, Fat Pitch Financials, it is a value investing blog with a focus on wide moat companies selling at substantial discounts and Benjamin Graham style workouts. I encourage you to subscribe for free to my blog feed to keep up with my latest postings.

You should also check my Fat Pitch Financials Contributor’s Corner while you are here. It is my premium members only community dedicated to unique arbitrage and special situation opportunities.

Now that you are familiar with Fat Pitch Financials, let’s take a look at this week’s Festival of Stock participants. Here are this week’s entries:

Hussein Sumar presents Three Reasons Why You Should Sell a Dividend Stock posted at Dividend Stocks, saying, “Sometimes a dividend paying stock that you own may be taken over with hostility by another company and current management is replaced with new management, whom you do not really know very well. Or, the company may be making mergers & acquisitions thus increasing their long term debt beyond levels you do not like. Another reason could be the industry the company operates in is undergoing major change or extinction, for instance Verizon at one point in time was considered a doomed company because of its landline business.”

Dr. Barry Burns presents Financial Independence While Still Working From Home | posted at Top Dog Trading, saying, “Creating Financial Independence Through Trading the Markets”

AlexG presents Li Lu Article On Charlie Munger | Magic Formula Pro posted at Magic Formula Pro.

Steve Alexander presents Kirklands (KIRK) Turnaround Looks Set to Continue posted at MagicDiligence – Optimizing Joel Greenblatts Value Stock Strategy, saying, “Kirkland’s is a home decor retailer selling a wide variety of items including wall decor, candles, rugs, mirrors, seasonal gift items, and so forth. An amazing turnaround has led to a 2,000% gain in the stock price from 2008, and with good business momentum, the stock should continue to climb.”

AlexG presents Magic Formula Stocks: Apollo Group (APOL) | Magic Formula Investing posted at Magic Formula Pro.

Dividends4Life presents Nucor Corporation (NUE) Dividend Stock Analysis posted at Dividends Value, saying, “Nucor Corporation is engaged in the manufacture and sale of steel and steel products. As the largest minimill steelmaker in the U.S., Nucor has one of the most diverse product lines of any steelmaker in the Americas. Linked here is a detailed analysis and commentary.”

Karen Stanlake presents Stock Market Technical Analysis posted at Stock Trading Systems.

Praveen presents Caveat Emptor: If An Investment or Opportunity Appears Too Good To Be True, Beware! posted at My Simple Trading System, saying, “Beware of investments that seem to good to be true.”

Praveen presents Tesla Motors, Inc (TSLA) IPO : Good Buy? posted at My Simple Trading System, saying, “Is Tesla Motors stock a good buy?”

AlexG presents Airline ETF | Leveraged ETF posted at Leveraged ETF.

Alexander presents A Great Dividend Yielding Limited Partnership posted at Dividend Stocks, saying, “The best two places to look for great dividend yields are in REIT’s and limited partnerships”

AlexG presents Warren Buffett Turns Book Into Mini Cult posted at Magic Formula Pro.

Freddy presents Today’s Hot Stock: F5 Networks Inc (FFIV) 12-July-2010 posted at Protege Analytics.

Steve Alexander presents Research In Motion Limited (RIMM) – Can BlackBerry Keep Up? posted at MagicDiligence – Optimizing Joel Greenblatts Value Stock Strategy, saying, “Research In Motion (RIMM), the makers of BlackBerry smartphones, has great growth prospects, excellent financial strength, and solid business momentum. But can the company compete with the new wave of smartphones from Google and Apple?”

Mike @ Green Panda presents Financial Guru Review: Jean Chatzky posted at Green Panda Treehouse, saying, “Jean Chatzky is definitely an expert when it comes to getting out of debt and managing finances.”

The Financial Blogger presents How Do You Manage Your Email? posted at The Financial Blogger, saying, “Managing emails will keep you more efficient, and get work done quickly. A lot of effort and time will be saved.”

Intelligent Speculator presents Daily news – July 14 2010 posted at Intelligent Speculator, saying, “Dell will start selling smartphones in India.”

Dividends4Life presents Harleysville Group Inc. (HGIC) Dividend Stock Analysis posted at Dividends Value, saying, “Harleysville Group Inc. is a regional holding company for property and casualty insurance companies that operates in 32 states, primarily in the eastern half of the U.S. linked here is a detailed analysis and commentary.”

Steve Alexander presents Top 10 Fastest Growing Companies in Magic Formula Investing posted at MagicDiligence – Optimizing Joel Greenblatts Value Stock Strategy, saying, “Top 10 fastest growing companies in Magic Formula Investing, based on compound annual revenue growth rates over the past 3 years.”

Dividend Growth Investor presents Highest Yielding Dividend Stocks of S&P 500 posted at Dividend Growth Investor, saying, “Many novice investors get in the world of dividend investing because of the belief that it is possible to generate double digit current yields. They purchase these securities in pursuit of current income, only to see these distributions cut after a few months. The truth is that few companies can afford to pay high dividends, unless they are pass-through entities such as master limited partnerships or real estate investment trusts to name a few.
I have highlighted the top 20 yielding stocks in the S&P 500 index below:”

PT presents OptionsHouse Review | Online Discount Broker posted at Prime Time Money, saying, “A review of one of the best online brokers. Super cheap stock trades and a nice options-focused platform.”

Steve Alexander presents Seagate (STX) – Hard Disk Industry Looks Attractive posted at MagicDiligence – Optimizing Joel Greenblatts Value Stock Strategy, saying, “Seagate is the worldwide leader in hard disk sales. The company has been improving operations and looks in good position to benefit from the secular growth trends in computer storage needs.”

Madison DuPaix presents Are the Mutual Fund Settlements Legit? posted at My Dollar Plan, saying, “Find out if you could stand to make money from some mutual fund settlements stemming back to 2003.”

Mike @ Green Panda presents The $7.27 Mistake Plus Ways To Avoid It posted at Green Panda Treehouse, saying, “How to avoid having to pay more when you’re out having fun.”

PT presents Done with Goldline? There’s More Than One Way to Buy Into Gold posted at Prime Time Money.

The Financial Blogger presents Real Estate: Time For The Mortgage! posted at The Financial Blogger, saying, “It will be easier to get a mortgage if you know what you need.”

Intelligent Speculator presents Of course Amazon (AMZN) results are terrible!! Blame Apple (AAPL) posted at Intelligent Speculator, saying, “Amazon’s continued focus on Kindle may end up costing Amazon.”

Dividend Growth Investor presents Wal-Mart (WMT): A High Dividend Growth Stock posted at Dividend Growth Investor, saying, “Wal-Mart Stores, Inc. operates retail stores in various formats worldwide. The company is member of the S&P 500, Dow Jones Industrials Average and the S&P Dividend Aristocrats indexes. Wal-Mart Stores has consistently increased dividends every year for 36 years. The company announced an 11% dividend raise in March 2010.”

Steve Alexander presents Eastman Kodak (EK) – Developing A New Exposure – MagicDiligence posted at MagicDiligence – Optimizing Joel Greenblatts Value Stock Strategy, saying, “Kodak, one of the great American brands of the past 100 years, has seen its traditional film business devastated by the digital photography revolution. Can the company successfully transition into a digital imaging company before the legacy film business turns negative?”

Super Saver presents Contrarian Optimism posted at My Wealth Builder.

Dividends4Life presents AT&T Inc. (T) Dividend Stock Analysis posted at Dividends Value, saying, “AT&T Inc. (formerly SBC Communications) provides telephone and broadband service, and the company holds full ownership of AT&T Mobility (formerly Cingular Wireless). AT&T Corp. was acquired in late 2005 and BellSouth in late 2006. Linked here is a detailed analysis and commentary.”

Intelligent Speculator presents Why Facebook is succeeding where Myspace has failed posted at Intelligent Speculator, saying, “Why Facebook is leading and MySpace is left trailing behind.”

Mike @ Green Panda presents Some Green Energy Tax Credits and Breaks to Consider for 2010 posted at Green Panda Treehouse, saying, “Saving money and get tax credits just by choosing to go green.”

The Financial Blogger presents Best 50 Canadian Dividend Stocks posted at The Financial Blogger, saying, “You can never get enough of dividend stock picks, so here are the Best 50 Canadian Dividend Stocks.”

David presents What?s the point of a Secured Credit Card? posted at Credit Card Offers IQ, saying, “Secured cards help build credit”

PT presents Mutual Fund Basics posted at Prime Time Money, saying, “Basic facts about the most popular investment product.”

Steve Alexander presents TJX Companies Inc (TJX) – Is the Stock Bargain Merchandise? – MagicDiligence posted at MagicDiligence – Optimizing Joel Greenblatts Value Stock Strategy, saying, “TJX Companies operates the T.J. Maxx, Marshall’s, A.J. Wright, and HomeGoods stores in the U.S., and similar stores in Canada and Europe. There is no doubt that the merchandise in the stores is a bargain, but what about the stock?”

Dividends4Life presents General Dynamics (GD) Dividend Stock Analysis posted at Dividends Value.

AlexG presents Seth Klarman: Don’t Be A Yield Pig 1992 Forbes | Magic Formula Investing posted at Magic Formula Pro.

David presents Chase Freedom® Visa $50 Cash Back Bonus posted at Credit Card Offers IQ, saying, “The Chase Freedom® Visa is now offering a $50 cash back bonus.”

PT presents TradeKing $50 Cash Bonus for New Accounts posted at Prime Time Money.

BudgetSnob presents Top 10 Investment Scams posted at Budget Snob.

Super Saver presents Where to Invest? posted at My Wealth Builder.

Sun presents Buying ETFs in Vanguard IRA Account Is Tricky posted at The Sun’s Financial Diary.

That concludes this edition of the Festival of Stocks. Be sure an leave comments as you visit each of the blogs that participated in this week’s Festival of Stocks. They’ll appreciate knowing folks are reading their articles.

If you are interested in volunteering to host a future edition of the Festival of Stocks, just contact me right away with the name of your site, blog URL, email address, and the date your prefer to host. Submit your blog article to the next edition of Festival of Stocks using our carnival submission form. Past posts and future hosts can be found on our Festival of Stocks index page for those of you interested in reviewing the archives.

Welcome to the July 6, 2010 edition of the Festival of Stocks. The Festival of Stocks is a blog carnival dedicated to highlighting bloggers best posts on stock market related topics. Fat Pitch Financials is the actual birth place of this online weekly event, so it is always a special occasion when I get the chance to host this roving event.

If you aren’t already familiar with my blog, Fat Pitch Financials, it is a value investing blog with a focus on wide moat companies selling at substantial discounts and Benjamin Graham style workouts. I encourage you to subscribe for free to my blog feed to keep up with my latest postings.

You should also check my Fat Pitch Financials Contributor’s Corner while you are here. It is my premium members only community dedicated to unique arbitrage and special situation opportunities.

Now that you are familiar with Fat Pitch Financials, let’s take a look at this week’s Festival of Stock participants. Here are this week’s entries: Read the rest of this entry »

Welcome to the June 21, 2010 edition of the Festival of Stocks. This week’s Festival of Stocks is celebrating Father’s Day. This year I got my father I great Wine of the Month Club subscription. My kids honored me with some excellent handcrafted cards that they designed. It’s not too late yet to honor your own father. You should at least forward him a copy of this week’s excellent Festival of Stocks. Here are this week’s submissions: Read the rest of this entry »

Welcome to the June 15, 2010 edition of the Festival of Stocks. The Festival of Stocks is a blog carnival dedicated to highlighting the best blog posts on stock market related topics. Fat Pitch Financials is the actual birth place of this online weekly event, so it is always a special occasion when I get the chance to host this roving event.

If you aren’t already familiar with my blog, Fat Pitch Financials, it is a value investing blog with a focus on wide moat companies selling at substantial discounts and Benjamin Graham style workouts. I encourage you to subscribe for free to my blog feed to keep up with my latest postings.

You should also check my Fat Pitch Financials Contributor’s Corner while you are here. It is my premium members only community dedicated to unique arbitrage and special situation opportunities.

Now that you are familiar with Fat Pitch Financials, let’s take a look at this week’s Festival of Stock participants. Here are this week’s entries: Read the rest of this entry »

Welcome to the June 7, 2010 edition of the Festival of Stocks. The Festival of Stocks is a blog carnival dedicated to highlighting bloggers best posts on stock market related topics. Fat Pitch Financials is the actual birth place of this online weekly event, so it is always a special occasion when I get the chance to host this roving event.

If you aren’t already familiar with my blog, Fat Pitch Financials, it is a value investing blog with a focus on wide moat companies selling at substantial discounts and Benjamin Graham style workouts. I encourage you to subscribe for free to my blog feed to keep up with my latest postings.

You should also check my Fat Pitch Financials Contributor’s Corner while you are here. It is my premium members only community dedicated to unique arbitrage and special situation opportunities.

Now that you are familiar with Fat Pitch Financials, let’s take a look at this week’s Festival of Stock participants. Here are this week’s entries: Read the rest of this entry »

Happy Memorial Day! This edition of the Festival of Stocks is dedicated to the memories of those that have died in the honor of service to the United States.

The Festival of Stocks is a blog carnival dedicated to highlighting bloggers best posts on stock market related topics. Fat Pitch Financials is the actual birth place of this online weekly event, so it is always a special occasion when I get the chance to host this roving event.

If you aren’t already familiar with my blog, Fat Pitch Financials, it is a value investing blog with a focus on wide moat companies selling at substantial discounts and Benjamin Graham style workouts. I encourage you to subscribe for free to my blog feed to keep up with my latest postings.

You should also check my Fat Pitch Financials Contributor’s Corner while you are here. It is my premium members only community dedicated to unique arbitrage and special situation opportunities.

Now that you are familiar with Fat Pitch Financials, let’s take a look at this week’s Festival of Stock participants. Here are this week’s entries:

Read the rest of this entry »

This April update on the Fat Pitch Financials Portfolio is way overdue. The month of May is almost over, so I’m just going to keep this brief. The Fat Pitch Financials Portfolio ended the month of April with a value of $1,417,845.87. The porfolio held $79,655.31 in cash and $1,338,190.56 in stock at the end of April 2010.

Fat Pitch Financials Portfolio Relative Performance Since Inception

Performance Numbers

For the six month period ending March 31, 2010 my fund outperformed 98.1% of the other funds on Marketocracy. For the  1 year period ending March 31, 2010 the FPF Port outperformed 94.6% of other funds on Marketocracy and 82.5% of other funds over a 2 year period.

Portfolio Holdings as of April 30, 2010

Trades in April:

On Apr 20, 2010 I bought 20,000 shares of  NovaMed Inc (NOVA) for $3.60 per share, or a total of $71,912.82.

Welcome to the May 24, 2010 edition of the Festival of Stocks. I’m still recovering from yesterday’s final episode of Lost. I’m not sure I really understand the ending, but at least we can get some better understanding of the financial world from this week’s entries into the Festival of Stocks.

The Festival of Stocks is a blog carnival dedicated to highlighting bloggers best posts on stock market related topics. Fat Pitch Financials is the actual birth place of this online weekly event, so it is always a special occasion when I get the chance to host this roving event.

If you aren’t already familiar with my blog, Fat Pitch Financials, it is a value investing blog with a focus on wide moat companies selling at substantial discounts and Benjamin Graham style workouts. I encourage you to subscribe for free to my blog feed to keep up with my latest postings.

You should also check my Fat Pitch Financials Contributor’s Corner while you are here. It is my premium members only community dedicated to unique arbitrage and special situation opportunities.

Now that you are familiar with Fat Pitch Financials, let’s take a look at this week’s Festival of Stock participants. Here are this week’s entries: Read the rest of this entry »

The Special Situations Real Money Portfolio continued its strong performance in March with another great month in April. The portfolio closed on April 30, 2010 with a balance of $34,683.37.  That’s up 3.2% for the month.

So far this year, the Special Situations Real Money Portfolio is up 12.11% year-to-date. That is 5% better than the S&P 500 year-to-date return of 7.05%. Overall, the portfolio is up 189.03% since inception on October 19, 2004. The internal rate of return or average annualized rate of return is still an impressive 31.51%.

Let me bring you up to speed on the transactions that took place in the Special Situations Real Money Port this past month. First, I finally received on April 5, 2010 the debentures for the shares of Western Sizzlin held in the portfolio. In total, I received 3,228 Steak N Shake debentures. However, that was rounded down to an even 3,000 debentures, and I received $8.07 per share for the 228 “baby debentures” held in the portfolio. On April 20, the debentures were renamed to Biglari Holdings Inc. Redeemable Sub. Deb. to reflect the name change of Steak N Shake (SNS) to Biglari Holdings (BH).

On April 12, 2010, I was cashed out of my 3COM (COMS) holdings. I held 400 shares of 3COM that I purchased on November 19, 2009 for $7.45 per share. Those 400 shares were cashed out for $7.90 per share. I made a net return of 5.79% on that investment. Considering that investment took 145, my average annualized rate of return on this investment is about 14.6%. That’s a pretty nice return for an unleveraged risk arbitrage trade. That same day I picked up shares of 500 shares of another company undergoing a merger with similar profit potential as 3COM.

On April 16, 2010, I invested $3,686.95 in a different type of special situation. This one involves an activist investor that has a track record for making changes to boards and then improving business profitability. This investment relies on shareholders voting in support of the proxy distributed by the activist investor.

On April 22, 2010, I sold out of my shares of net-net Conn’s (CONN) after shares ran up substantially. I sold the last 500 shares of Conn’s (CONN) is the Special Situations Real Money Portfolio. My stop order was triggered and 400 shares were sold for $9.75 and 100 shares sold for $9.82 per share. The total proceeds from that sale came to $4,875.05. I bought this block of 500 shares on February 9, 2010 at $4.50 per share for a total cost of $2,256.95, Therefore, my total profit for this trade was $2,618.10. The return on these 500 shares came out to be an amazing 116%!

Finally, on April 26, 2010, my shares of Boss Holdings (BSHI) were removed from my account and I should be receiving $7.65 per share shortly. I originally bought the 99 shares of Boss Holdings in my account for $6.00 per share on January 22, 2010. Later in the day on April 26, 2010,  I also put in an order to buy another merger arbitrage opportunity with a small regional bank.

If you’d like to learn more about the positions I’ve been trading in this portfolio, follow my research on new special situations, and participate in our exclusive community of stock workout aficionados, consider joining my premium service, Fat Pitch Financials Contributors Corner.

Disclosure: At the time this article was posted, I owned shares of Biglari Holdings (BH) and Boss Holdings (BSHI). I no longer own shares of 3COM, and Conn’s (CONN).