Who thinks BP is a good play right now?

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Lost 13% today - trading around $29.50

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Losses since the start of this conversation is more than 20%. Losses since the oil spill is now over 50%.

Today's 16% loss is due to fear that the hemorrhaging market cap is putting the company in danger of bankruptcy.

But, it's starting to look interesting....

[disneysteve]

Losses since the start of this conversation is more than 20%. Losses since the oil spill is now over 50%.

Today's 16% loss is due to fear that the hemorrhaging market cap puts company in danger of bankruptcy.

But, it's starting to look interesting....

The time to make money is when there is blood in the streets.

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It may be interesting to follow it with BUY orders with a 5-10% differential when the blood on the street clears up.

I wouldn't really see bankruptcy. . .I would imagine that a bigger co. would buy them out and assume the liability for the spill (and that would be an interesting legal matter itself).

[Slug]

The bonds are looking really attractive now. Some with yields around 6.75%. Unfortunately, the required minimum of 5 bonds puts the entry price at $4500 for the ones I want. That's just too pricey for my middle class status.

[disneysteve]

Stock is up 12.5% today. Should have bought some yesterday.

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You mean corporate bonds to BP? That may not be a bad idea - loaning them money at a premium while they wade through this disaster.

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The time to make money is when there is blood in the streets.

I agree. The drop from the fear made it much more compelling, but alas, it rebounded today, currently standing at +12.75%. I probably would've bought back in then if my money was settled, but it wasn't so I didn't.

The bonds are looking really attractive now. Some with yields around 6.75%. Unfortunately, the required minimum of 5 bonds puts the entry price at $4500 for the ones I want. That's just too pricey for my middle class status.

Lucky you, Scottrade requires $10k minimum. Who are you trading through, by the way?

But yeah, BP bonds are awesome right now. That's probably the smartest move individual investors can make with this name.

Otherwise, if one insists on playing (short-term) with the stock, I think you can agree with me that call options are the best route to take. That way, at least your losses are defined. But after today's rebound though, I'm not sure even that's a good idea....

[Slug]

BA - I'm using Ameritrade.

Those minimums are really unfortunate. When Treasury Direct dropped from a $10k to $1k minimum it was great for everybody. You'd think corporate bonds would be on the leading edge rather than trailing the Treasury.

I'm a hold on BP right now. If they cancel the dividend for more than 2 quarters, I think there's more downside potential. The rest I think is already priced in. 30 bucks is so cheap though - hard not to pull the trigger.

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Yes. For $30, I am quite tempted to buy. However:

* Despite today's bullish market and despite this stock's intra-day pop of 3%, BP's futures action is still bearish.

* $30 is still slightly above the 52-week low, and until the pop anyways, it appeared to be driven more by weakness this time than by fear. I could be wrong though, since now it's popped.

* I think there are still a lot of question marks. The biggest one to me is the loop current and its ultimate effect on the Atlantic coastline, all the way up to the Carolinas.

* It then begs the question, "Will the $20 billion escrow fund be enough?" Some are putting the reparation estimates closer to $40 billon. Even if that's the case, while it won't break the company, it still means that the stock has further to fall.

Bottom line, I think $30 is going to be tested, and I'm going to wait a bit longer to see how that shakes out. In the meantime, BP isn't the only table to bet your money on. There are plenty more out there with much better odds I think.

[Slug]

I'm trying to exit a few positions right now (GEX, FCX, TCEHY) to wrangle the cash to buy the bonds on the next downdraft. The question then becomes the time horizon. I can get:

11/2013 with a 7.841% YTM
3/2012 with a 7.735% YTM
8/2011 with a 7.642% YTM

That's not much of an increase in yield for the extra 20 mths of lockup from '12 option to the '13 option, but where else can I get this kind of assured yield during that time period?????

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Sadly, I really have no idea in options terms. I am currently quite limited on what I can do as it is, since I work full time and the only access I have for stock trading is with the work computer. So, I just haven't been able to dig deeper into options trading. Would love to learn though. I mean, what do you think of all this?

[Slug]

I meant "option" in the sense of a choice. Those are bonds I listed with their yield to maturity. I'm curious what the BP stock reaction to the Obama speech will be.

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Oh! I wear a different hat when I look at bonds. They're the portion of the money I'd like to basically lock away and keep safe, although some might argue with me about the relative safety of BP bonds.

The yields are close enough to me that it's negligible. So, the question I would ask then is how long you would like to keep this portion of the (non-trading) money stashed away?

[Slug]

And, the answer is that the yield inverted this morning due to the Fitch downgrade. Of course the downgrade sent the yield higher as well. For me, this is enough yield. I locked it in here. My yield to maturity is 9.95%. I had to call Ameritrade to do the order because they won't let you buy online if there has been a recent downgrade. Probably a good policy. Due to this purchase, and the 10 shares I own, I'm probably done with BP for now. Anything more is just too much $ on 1 company. It probably already is, but I really wanted the bonds.