CNBC Million Dollar Portfolio Challenge: #1227

It was just a matter of time before my string of good fortune came to an end, but for all practical purposes, it probably should not have been today. Still, at #1227 out of 1,441,536 contestants as of last night, I have managed to hold on to a top 0.1% rating for one more day.

Scrolling back a little, my current position is the result of a 2.8% loss in Wright Medical Group (WMGI) yesterday, putting an end to a nice run of six straight days of gains of 2% or more. As I described earlier, I had carelessly thought WMGI would report earnings before the market opened or during the day yesterday, but this turned out not to be the case. Had I held on to WMGI, I would be sitting on what is currently a 6% gain, but instead, I went back to my earnings spike potential algorithm. This handy tool had helped pick the six consecutive winners and had pointed to a couple of other big movers as well. Yesterday it spit out Atheros Communications (ATHR), currently up 7%, as the top choice. Between WMGI and ATHR, how could I go wrong? Well, I got cute and thought I might be able to get even more volatility out of i2 Technologies (ITWO), whose dangerous coiled spring cocktail includes a huge beta (over 10 on Yahoo), an equally impressive short position of 13.1 days to cover, and an implied call volatility of 60. Well, I got the volatility I wanted, but I missed out on the direction, as ITWO is trading down 28% this morning. It is only a small consolation to know that the algorithm seems to be working…

Depending upon how far I fall down the ranks today, I will make a determination whether I should roll the dice one final time with the likes of Dendreon (DNDN) in hopes of rocketing my way into the finals or just play for a respectable position, such as the top 1%. I know that this is only play money, but after having come this far, it seems silly to spend it all on one last lottery ticket.

CNBC Million Dollar Portfolio Challenge: #1047

I have moved up to #1047 out of 1,438,436 contestants, putting me in the top 0.08%, but have suffered a couple of small disappointments since Friday’s update.

The first disappointment was the inability of NetLogic Microsystems (NETL) to hold their early gains on Friday. The stock was up 14% in the early going, bet ended the day with only a 3.5% advance. The second disappointment was entirely of my own doing. I had expected that Wright Medical Group (WMGI) would report before the close today and it now looks like I jumped the gun there. This was my screw-up, as I failed to confirm the anticipated timing of the earnings announcement before placing the trade. It is possible that this Texas-based company may report before the bell and give me some much needed volatility, but that is looking increasingly unlikely as the day wears on.

The silver lining, if there is one, is that the WMGI trade, which is down about 1.5% at the moment, may have saved me from jumping in to ICICI Bank (IBN), which is down over 7% at the moment. IBN, an Indian bank, and Kookmin Bank (KB), a South Korean bank up 2% so far today, were the other two finalists in my daily search for earnings volatility.

Getting back to horns, J. J. Johnson (pictured above) is probably the greatest jazz trombonist who has ever lived. His collaborations with fellow trombonist Jay Winding are legendary and would be an excellent first stop for anyone interested in checking out Johnson’s talents.