Take a Gamble?

So I’m left to wonder why “Gaming” is beating so much of the rest of the market…

BJK - a "Gaming" ETF vs broader market ETFs

BJK - a "Gaming" ETF vs broader market ETFs

BJK - Gaming ETF
GLD - Gold ETF
SPY - S&P 500 Index Fund
IWN - Russell 2000 Index Fund
EWO - Austria ETF
EWS - Singapore ETF
EWD - Sweden ETF

So, top of this heap, is a “Gaming” bundle. Right behind it is Austria (where the Greek Debt to their banks was/is an issue). Then the Swedes, the Russel 2000, and everything else..

“Why? Don’t ask why, down that path lies insanity and ruin. -E.M.Smith”…

Maybe because if feels so good when you stop?

Maybe because they didn’t die, and this is a short covering rally?

Maybe an early indicator that Chinese lose just as much as Japanese and US “business men” on junkets?

From: http://finance.yahoo.com/q?s=bjk&ql=1

the “holdings” tab says it has:

Las Vegas Sands Corp. Common St LVS 12.86
Las Vegas Sands Corp. Common St LVS 12.22
Wynn Resorts, Limited WYNN 8.80
Genting Berhad N/A 6.94
01928.HK 5.31
01928.HK 4.82
TABCF.AX 4.53
International Game Technology C IGT 4.17
WYNMF 4.06
01928 4.06

OK, a lot of Las Vegas Sands and some Wynn resorts. Then some “other stuff” and IGT who make slot machines. The .HK is, I think, Hong Kong market. The .AX I have no idea.

Looking at the “industry” for LVS gives these 3 month winners vs losers:

 INDUSTRY INDEX STATISTICS Price:	590.70
Price Change: 	19.03
% Price Change:	3.33%
52-Week Range:	346.60  to  618.37 


Best Performing Stocks
Symbol	Company Name	Percent Change	Charts
ATIG	Atlantis Internet Group Corp.	1,233%	
MPEL	Melco Crown Entertainment Ltd. ADS	69.66%	
NYNY	Empire Resorts Inc.	55.00%	
FGMG	Florida Gaming Corp.	45.96%	
NNSR	NanoSensors Inc.	40.00%	
IXMD	Intelimax Media Inc.	35.14%	
ASCA	Ameristar Casinos Inc.	28.38%	
CPHC	Canterbury Park Holding Corp.	26.55%	
SCHYY	Sands China Ltd. ADS	22.58%	
WYNMF	Wynn Macau Ltd.	19.71%	

Worst Performing Stocks
Symbol	Company Name	Percent Change	Charts
EGT	Entertainment Gaming Asia Inc.	-27.35%	
GMTC	Gametech International Inc.	-26.91%	
MGAM	Multimedia Games Holding Co. Inc.	-19.55%	
LACO	Lakes Entertainment Inc.	-15.61%	
WMS	WMS Industries Inc.	-13.43%	
FLL	Full House Resorts Inc.	-13.23%	
SHFL	Shuffle Master Inc.	-12.17%	
ISLE	Isle of Capri Casinos Inc.	-10.11%	
DDE	Dover Downs Gaming & Entertainment Inc.	-8.96%	
AERL	Asia Entertainment & Resources Ltd.	-8.88%

Florida Gaming Corp? Who knew… The ADS is “American Depository Shares”, indicating the actual company is in another country. Looks to me like folks catering to “overseas” have the most growth. Las Vegas, not so much. Several of the traditional Las Vegas names are not even on this list, so are “middle of the pack” somewhere.

Traditionally you can also include Cruise Lines in this sector, as they have gambling on board, or put them in with hotels. My “typical” candidates are RCL and CCL as cruise lines (they can move the “casino” to wherever the “action” is).

At any rate, it looks like some “action” to be had in “gaming”, but I’d be careful about throwing too much money at that table. Though a decent “dig here” would be that ATIG stock… Wonder if it’s all “played out” or just starting to roll the dice…

Digging In

So that’s an example of how you can start with an ETF race. See what’s moving, and then “Drill down” to find the really rocking vs the “also ran” members of that sector.

If you click on “show all members of this sector” on that “industry list”, you get a list of all the candidate tickers to sort through:

ASCA	Ameristar Casinos Inc.	
ARHND	Archon Corp.	
AERL	Asia Entertainment & Resources Ltd.	
ATIG	Atlantis Internet Group Corp.	
BYI	Bally Technologies Inc.	
BYD	Boyd Gaming Corp.	
CPHC	Canterbury Park Holding Corp.	
CNTY	Century Casinos Inc.	
CHDN	Churchill Downs Inc.	
DDE	Dover Downs Gaming & Entertainment Inc.	
NYNY	Empire Resorts Inc.	
EGT	Entertainment Gaming Asia Inc.	
FGMG	Florida Gaming Corp.	
FLL	Full House Resorts Inc.	
GMTC	Gametech International Inc.	
GPIC	Gaming Partners International Corp.	
IXMD	Intelimax Media Inc.	
IGT	International Game Technology	
ISLE	Isle of Capri Casinos Inc.	
KENS	Kenilworth Systems Corp.	
LACO	Lakes Entertainment Inc.	
LVS	Las Vegas Sands Corp.	
MPEL	Melco Crown Entertainment Ltd. ADS	
MGM	MGM Resorts International	
MGAM	Multimedia Games Holding Co. Inc.	
MCRI	Monarch Casino & Resort Inc.	
MNTG	MTR Gaming Group Inc.	
NNSR	NanoSensors Inc.	
UWN	Nevada Gold & Casinos Ltd.	
PENN	Penn National Gaming Inc.	
PNK	Pinnacle Entertainment Inc.	
PTEK	PokerTek Inc.	
SCHYY	Sands China Ltd. ADS	
SGMS	Scientific Games Corp.	
SHFL	Shuffle Master Inc.	
TPCA	Tropicana Entertainment Inc.	
WMS	WMS Industries Inc.	
WYNMF	Wynn Macau Ltd.	
WYNMY	Wynn Macau Ltd. ADS	
WYNN	Wynn Resorts Ltd.

Here we can see that Wynn resorts has a distinct ticker just for their Macau operations, and Sands has one for China as well.

Picking through here for some “races” can let you see what is moving, and what was ‘left at the gate’.

So making a semi-random “race” of some tickers I recognize:

Some Gaming Tickers and 2 Cruise Lines

Some Gaming Tickers and 2 Cruise Lines

I don’t like the general look of that LVS line, upper left to lower right… but it has tradable “ripple” to it. Much more interesting is how that blue line for the WYNMY Wynn Macau is moving.

The general “thesis” here as a “takeaway” is “Buy what is selling to China” and “Chinese like to gamble”. So “Dig Here!” on those is where you will likely find the nugget…

FWIW, I looked at EGT and it’s a “flat roller” penny stock. You have to filter out that kind of stuff… “Editing Editing Editing”… it’s not just for books…

And, to save you the suspense, ATIG ia a penny stock too, trading on the Pink Sheets for 0.012 last trade. It’s easy to get gigantic percentage gains (or losses) when trading at fractional pennies…

It made a big jump on news in April (perhaps the report that it was going to actually have an accounting system and audits and everything, just like real companies) and has been “dribbling down” ever since.

A bit of checking shows the actual story that made the move was about being approved as an Indian Gaming provider:

ATIG Approved as Associate Member of the National Indian Gaming Association
Selects Blue Stone Strategy Group as Tribal Consultant

LAS VEGAS, NV, Apr 19, 2011 (MARKETWIRE via COMTEX) — Atlantis Internet Group, Corp. (pinksheets:ATIG) has announced its approval as an Associate Member of the National Indian Gaming Association (NIGA). The company plans to launch its Tribal Gaming Network (a private gaming network offering Class III, Class II and Online games on Indian Lands nationwide) in the summer of 2011. A version of the network was approved for use in Indian Casinos by the National Indian Gaming Commission (NIGC). The network was designed to create new jobs and economic stimulus to Tribes by linking Indian Casinos nationwide offering Wide Area Progressive Games, Poker and a legal form of Intranet Gaming by using the UIGEA exemption for Tribes.

Understanding the need of Tribal Casinos is vital to supplying an economic shot in the arm to Indian Gaming which has also experienced the economic downturn over the last two years. With this in mind, the company has hired Blue Stone Strategy Group to give ATIG a better understanding of the needs of Tribal communities. Blue Stone Strategy Group is a leading Native American owned advisory group to Tribal leaders and decision makers. “Many Tribes have experienced a decline in Federal funding and are looking for creative ways to protect and diversify their economies. Our team of experts work with Tribal Nations to find strategic solutions to just about any challenge they may face,” said Jamie L. Fullmer, Chairman and CEO of Blue Stone Strategy Group. Blue Stone Group’s executives and advisors are Tribal leaders, both current and former, who continue to serve Indian communities throughout the United States. Learn more about Blue Stone Strategy Group at: http://www.bluestonestrategygroup.com

To promote and sell its Tribal Gaming Network, ATIG has assembled an impressive sales team with over 35 years experience in sales, service and licensing of Tribal Casinos nationwide. ATIG will be an exhibitor at the upcoming GIGSE gaming convention in San Francisco on May 17-19 and debut its Tribal Gaming Network. Major Commercial, Indian and Online operators will showcase their products. The convention will also feature several gaming commissions and legislators from across the Nation who will detail the changes in the US gaming market. A demo of some of the games on the network can be found at http://www.atlantisinternetgroup.com/tgn .

ATIG will continue its efforts to move up to OTCBB
and management is very excited about the Company’s future. “The Company is adding some of the leading gaming companies in the World as partners on the Tribal Gaming Network offering new gaming products to the US,” stated Donald L. Bailey, President/CEO of Atlantis Internet Group, Corp.

OTCBB is Over The Counter Bulletin Board and one step above Pink Sheets (that is about as low as a stock can be in the markets and still trade). So “it’s an aspirational thing”…

Niche player in a narrow market pops on news. Just walks away… no, better yet, run away…

In Conclusion

So that’s how I do this stuff. Find a moving sector. Look into what, sometimes a bit of why, always who and how much. Check out what’s a “story stock” and the POP is over (or mid bubble) and who is a Whale moving into new parts of the world. Filter the penny ante stuff, and pick a ride. Get to know that one (or two) so you don’t have to spend a lot of time in the future deciding (again…) but can just hop on WYNN or RCL or … at the drop of a ticker.

Sometimes find an interesting managed fund I didn’t know about (that BJK showed up on a “moving ETFS” screen here: http://www.barchart.com/etf/hotnot.php one day last week. Then you just start digging into what is “interesting”.

Right now it lists:

Top 10 ETFs
All Top Performing ETFs
Name	Last	Change	Std Dev	Links
MSCI Indonesia Inves	32.76	+0.75	+2.41	   
DOW Jones-UBS Sugar	91.62	+3.44	+2.14	   
Utilities Alphadex	18.44	+0.25	+2.13	   
Vg Telecom Services	72.43	+1.17	+2.10	   
Vg Utilities ETF	72.90	+0.92	+2.09	   
Indonesia Index ETF	32.67	+0.69	+2.01	   
High Yield Equity	8.93	+0.12	+2.01	   
S&P Conservative All	29.48	+0.13	+2.01	   
SPDR Fund - Utilitie	33.88	+0.40	+1.96	   
DJ Transportation	100.19	+2.23	+1.96	   

A pretty broad mix. But it does point back at Indonesia (check that IDX ticker again) and sugar. Then that “transportation” is interesting. Dropping oil? Improving economy? Some things to check.

The losers?:

Bottom 10 ETFs
All Bottom Performing ETFs
Name	Last	Change	Std Dev	Links
Barclays 0-5 Year	101.92	-0.45	-3.10	   
Barclays 1-3 Year	104.60	-0.35	-2.96	   
Ag Daily Long-Short	24.77	-0.51	-2.67	   
S&P National Muni	102.89	-0.62	-2.67	   
Barclays Mbs Bond	106.25	-0.46	-2.56	   
Long Enhanced S&P	9.93	-1.87	-2.47	   
Barclays Agency Bond	110.38	-0.33	-2.34	   
Factorshares 2X Gold	24.88	-1.27	-2.32	   
ViX Mid-Term Futures	58.96	-2.82	-2.23	   
S&P 500 VIX Mid-Term	48.11	-2.26	-2.21	   

Hmmm…. LOTS of bonds ( if you have not already gotten out, probably a good time to get out) along with a falling Volatility Index or VIX (happens as markets rise) and even the 2x leveraged Gold fund (but we already knew gold was dropping, and even have a handle on why and when… https://chiefio.wordpress.com/2011/06/29/gld-gold-an-interesting-chart/ )

Can it really be that easy?

Yup, it sure can. But you DO have to look, frequently, and “Dig Here!” to see the picture…

Start with “moving now” inspiration, move to “what’s inside that box?” and then on to “expand to more of the industry” then “filter aggressively for quality”, ending with “Is there a memorable theme?”

Sometimes you find a “junior stock” with a great story and honest prospects for changing the world. Rarely below $5, substantially never below $1, and a ‘diamond’ for sure. Usually you find the large mid-sized player with ability to dominate the small guys and a better more aggressive play than the largest or most stagnant player (who is often focused just on defending a dying or stagnant turf). Sometimes it IS that dominant player, smart enough to be both large, and dynamic. So “story” does matter, some, as a filter… after all the other filters… That WYNMY, for example. The “China Story”. That is actionable long term growth. Added to an “Indian Gaming Approved List”? More of a “one off” (and I have to wonder if someone is a member of some particular tribe or another…) unlikely to be repeated any time soon. Often you find a fund, like that BJK, which gives a nice exposure and with a day to day manager deciding to keep the trash out and ready to dump anything that starts turning sour. An easy way to get a nice mixed basket with someone watching it. (Still need to look a bit into who offers the ETF. Barclay’s? Good. “Joes ETF Emporium from Shanghai?” um… and need to check on how many shares typically trade. Under 1000 it will be hard to exit when things turn, at least with any decent price. Over 100,000? Not much to worry about. Then take a peek at the financial statements of the “contents”, are they making money or not? Does the manager choose “good goods” like WYNN, or “broken stocks” looking for a story? and you ought to run… )

And that’s how you do it.

Always a little “fresh” as what’s moving “now” changes every day, yet with some structure and discipline.

Repeat again the next day, or week.

Me? I’m staying with the cruise lines. I’ve traded them for years and know them. But I’ll likely add some of that WYNN in Macau, just for the entertainment value, if nothing else… and to start getting to “know” it as well.

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About E.M.Smith

A technical managerial sort interested in things from Stonehenge to computer science. My present "hot buttons' are the mythology of Climate Change and ancient metrology; but things change...
This entry was posted in Economics - Trading - and Money and tagged , , . Bookmark the permalink.

7 Responses to Take a Gamble?

  1. boballab says:

    EM:

    I don’t know how it is on the west coast concerning gaming now nor how much news of what gaming is doing on the east coast, but I can tell you that in the Mid atlantic region gaming is booming outside of Atlantic City.

    In Maryland they have opened two slot machine casinos at racetracks in the last year with 3 more planned:

    Open for more than five months each, Maryland’s only gambling options have already established themselves as destinations — they’ve raked in a combined $77 million in revenue since September, according to the Maryland Lottery.

    http://articles.baltimoresun.com/2011-06-15/travel/bs-tr-ocean-downs-20110614_1_ocean-downs-slot-machines-maryland-gambling

    Delaware has had slot machine gaming at tracks for years now but has just allowed table gamin too:

    Three gaming facilities are in the state, Delaware Park near Wilmington, Dover Downs in Dover and Harrington Raceway near the Delaware State fairgrounds. While each facility offers cash games, the daily tournaments vary at each site. You can find the times of the daily tournaments in the Where to Play portion of the magazine.

    Delaware Park recently expanded its daily tournament schedule, spreading four events each day. To try to attract the former Internet players, there’s a $20 buy-in tournament on Wednesdays and Sundays. On Thursdays and Fridays, Omaha tournaments are offered and major promotional tournaments will take place over Independence Day weekend.

    Dover’s Crown Royal Poker Room is hosting the Summer Open on July 8-16 (see ad at left). Also the Delaware State Championship is Sept. 10 with qualifying satellites running daily. It will have a $10K guarantee. Dover hosts numerous series throughout the year. Be sure to check our Where to Play pages each month for dates and schedules.

    http://www.anteupmagazine.com/featured-column/poker-is-indeed-in-the-mid-atlantic-region.htm

    Pennsylvania seeing the money flowing out of state not only to NJ but also into Delaware starting in 1996 got into the act:

    Three Philadelphia-area casinos ranked in the top five among the state’s 10 gambling halls in table-games revenue last month, according to figures released Monday by the Pennsylvania Gaming Control Board.

    The three venues – Parx in Bensalem, Harrah’s in Chester, and SugarHouse on the Philadelphia waterfront – accounted for nearly 45 percent of May’s $51.4 million in total revenue from table games.

    Parx, which opened a $3 million high limit room last week to court high rollers and added more blackjack, poker, craps, and baccarat tables to push its total to about 200, led the pack with $9.8 million in table-games revenue. Sands Resort Casino in Bethlehem, with 113 tables, came in second with $7.2 million.

    http://articles.philly.com/2011-06-21/business/29683954_1_parx-table-games-sugarhouse

    West Virginia has also allowed gambling in certain locations in their state.

    So as you can see right now there is a Casino/Gaming boom in the Mid Atlantic region where there is that very heavily populated “I-95 Corridor”.

  2. E.M.Smith says:

    @Boballab:

    Got any “tickers”?

    I think the expansion of casinos to ‘near ubiquitous’ outside Nevada from SoCal Indian Casinos, through the Gulf Coast, and up the East Coast goes a long way to explain the flat nature of the Las Vegas stocks…

    So, Long China and Long Bethelehem Casinos… It’s a strange world some times…

  3. boballab says:

    EM:

    For alot of these “casino’s” they are run by smaller outfits than like some of the ones in PA , such as Sands or Harrah’s.

    For the Perryville casino it is run by the Penn National Gaming company (Penn): http://www.pngaming.com/main/compinfo.shtml
    They have a very nice financial information page too.

    However here is the ticker via Google Finance: http://www.google.com/finance?q=NASDAQ%3APENN

    I also stumbled over a report done by the American Gaming Association that does a state by state overview: http://www.americangaming.org/files/aga/uploads/docs/sos/aga-sos-2011.pdf

  4. E.M.Smith says:

    @Boballab:

    Thanks for the links! I’ll be looking into them in the coming days…

    Nice to see a bit of “community invetment work” as a barnraising kind of cooperative activity too… My hope is to get more folks to participate on some of the ideas as “many hands make light work” and also “many brains avoid a screw up”…

  5. boballab says:

    EM:

    If you go to the Penn National Gaming financial page you will see that they have but all of their SEC filings since 1996 online there in PDF and Word Doc format as well as Excel Spreadsheets of their Quarterlies. They also have a Stock ticker where you can do comparisons to the likes of the S&P 500. Very nice to see a company being that upfront

  6. TIM CLARK says:

    Good call on the silver BTW

  7. E.M.Smith says:

    @Tim Clark:

    Thanks!

    It always gives me a nice warm feeling to ‘get it right’, even if I don’t have a bet on at the time…

    FWIW, looking at the chart up to we now have matched the “prior high” and with RSI near 80. If the market in general is taking a pause right now, and this ticker continues the ‘go nowhere’ failure to advance, then the next direction would be back to the SMA stack… Yeah, a lot of “ifs” but that’s what the process is like…

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