Unless you’ve been vacationing in Edmonton, you’ve probably heard the news that rocked Canada. E*Trade Canada, a discount brokerage, has introduced the so-called 60-Second Advantage. Once the cheering died down, we had just one question for our pals at E*Trade.
HOW ABOUT A 60-MINUTE TRADE!
Or free knitting lessons so one can pass the time productively during the trading delays.
Two days after the big news of the 60-second trade (meaning trade execution by E*Trade), it took more than 60 minutes to place one trade online.
The first half hour after the opening bell was spent battling for mere access to the trading system, and the second half hour was spent retrieving a live quote, getting into the trading desk and transacting the trade.
An attempt to trade by phone during that hour was also futile as we were put on hold.
Which begs the question: Did all those folks in the Hogtown office wielding their 60-second stopwatches somehow corrupt the system?
Prior to that day, E*Trade had been on a roll in recent months with few problems.
The concept of the 60-second trade — E*Trade says it will waive commissions (usually $27) if a trade is not executed in 60 seconds or less after an order is received — seemed fine until the fine print reared its ugly head.
Most importantly, only market orders and not limit orders on the Toronto Stock Exchange qualify. Savvy traders use limit orders, buying and selling at a specific price.
The program also does not apply in the first 15 minutes or the last 15 minutes of the trading day, which essentially is prime market time.
Incredibly, it does not apply to fast markets, defined as time when volume is sufficiently high or markets are sufficiently volatile.
The 60-second trade also does not apply in the event of a system failure, TSE crash, a delay of the TSE opening, for trade-halt situations, for mutual fund or options trades and for trades not executed online or by the automated phone system.
Apparently, the program does apply to trades on weekdays.
PRO'S THREE STARS:
Brian Bapty, biotechnology analyst with Vancouver-based Goepel McDermid, favours StressGen Biotechnologies as his top pick, rating it a strong buy.
Bapty’s 12-month target price for StressGen (SSB-TSE) is $15.50. The stock had a recent price of $6.25 (year range, $2.80-$13.35).
StressGen’s lead compound, HspE7, is being tested in Phase II and III trials for treatment for genital warts caused by the human papillomavirus (HPV) and HPV-related anal dysplasia and cervical cancer and cervical dysplasia.
“With such a huge market potential, StressGen is evolving as a leading player,” says Bapty.
His other stars are Inex Pharmaceuticals (IEX-TSE) and Micrologix Biotech (MBI-TSE), both rated as strong buys.
Inex, with a recent price of $4.95 and range of $4.45-$14.35, gets a $10.50 12-month target. The company’s lead product is Onco TCS for treatment of non-Hodgkins lymphoma and Bapty expects the company will go into partnership with another company this quarter for future marketing of the lead product.
Micrologix, with a recent price of $3.90 and range of $3.90-$13.50, has a high-risk profile, according to Bapty, but “is nearing an attractive valuation.”
His 12-month target is $8.50 for the company, which is in Phase III trials with a product for prevention of life-threatening, catheter-related bloodstream infections.
TRADING TIP:
Don’t put all your money on one horse. The market is not a one-horse race, a lesson many investors bogged down by Nortel stock learned the hard way in recent months.
Most experts advise not allocating more than five per cent of one’s capital on any one play.
SITE OF THE WEEK: www.fundlibrary.com
It’s a Canadian mutual fund investors’ dream, with listings of all 240 Canadian fund companies.
And 32 of those companies offer links to in-depth data on their funds, including performance records.
HOT STOCK: Global Thermoelectric GLE-TSE $24.80 Up $6.70 (+37%) on 1,530,400 shares (for week ending Jan. 19).
Pass the anti-nauseant drugs. Gut-wrenching volatility is the name of the game in fuel-cell companies. Just ask any shareholder of Global Thermoelectric, the Calgary developer of solid-oxide fuel-cell technology. It’s been a dizzying ride for Global, which rocketed to a peak of $51.25 10 months ago before crashing back to earth twice. The latest pop looks particularly interesting due to escalating daily volume.
COLD STOCK: Gimbel Vision International GBV-TSE .135 Down .055 (-29%) on 91,300 shares (for week ending Jan. 19).
Remember when you strapped on the boards for the first time atop Sunshine Village and rocketed down the slope at blinding speed in a tuck? Well, you might recognize that slope. It’s a Gimbel chart, no sight for sore eyes in its descent from 99 cents a year ago. The Calgary vision-correction company said in December that Aris Vision had a binding letter of intent to become the controlling shareholder.
