If you're not familiar with CAPS, it's a place where investors pick and pan stocks. You get graded along with your fellow Fools. That may make the service feel like a game, but in reality it's a growing pool of collective market knowledge. In short, it's an engine that will get smarter as it makes you smarter.
I can use plenty of help. I started out two weeks ago with a 0.55 rating, meaning that 99.45% of the CAPS community had amassed better trading scores. I made a few moves, hoping to improve my position, but it didn't help. My rating dropped to 0.51 a week later.
The good news is that I finally began to make some headway. The bad news is that my rating as of last night was only up to 1.35. I still have 98.65% of you to lap to make it back to being Top Fool.
Making moves and taking names
Since my deadweight pruning last week didn't help, I decided to initiate some new positions this week. My first move was to peg Yahoo!
Here's my logic on that particular move. The Microsoft
Yahoo! is going to be sorely tempted to balk at the deal as it drops in value. Microsoft has seen its market value take a huge hit in response to the deal, so it's unlikely to make things worse by sweetening the pot. With no legitimate rival bidder, Yahoo! shares should fall if the company passes on the offer, just a little at first, but precipitously once investors realize that Microsoft isn't likely to come back with a better offer.
Another move I made was to peg Children's Place
However, the retailer revealed yesterday that the company's former CEO has contacted the company about buying it completely. Media reports have the offer at $24 a share. Unlike the Microhoo noise, I see the potential for a bidding war here. At the very least, there appears to be an offer genuine enough to make things interesting.
The other move I made this week was to go long with Ultra Technology ProShares
It wasn't to be. I'm seeing some amazing bargains in the technology blue chips, but I get the feeling I may not stick with this one for too much longer.
Since we're now waist-deep in earnings season, I expect volatility in my rankings. I have plenty of picks -- bullish and bearish -- on companies that are set to report next week, including Baidu.com
Am I nervous that Baidu's report is following disappointing performances out of Yahoo! and Google? Not at all. China's Web market growth is not tethered to this country's dot-com fortunes. If anything, it may be the best thing for the company to prove that it's marching to its own drummer -- a better one.
Between now and next week, I'll see you over at Motley Fool CAPS, hoping to shed my starring role as one of the simulation's biggest losers.
Want to match stock-picking wits with me and more than 83,000 other investors? Give Motley Fool CAPS a spin and let us know what you think. Disney is a Motley Fool Stock Advisor newsletter recommendation, while Yahoo! is a former one. Baidu.com is a Rule Breakers pick. Microsoft is an Inside Value selection.
Longtime Fool contributor Rick Munarriz is always up for a good game. He does not own shares in any of the stocks in this story, save for Disney. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool's disclosure policy is even more intimate than my market diary.