Purchased LDK Solar (LDK)

We purchased LDK Solar at $30.30 per share yesterday. LDK Solar is a producer and supplier of solar grade polysilicon wafers to solar cell & module manufacturers. The stock came down a whopping 60% due to allegations about inventory overstatement of its silicon feedstock. An independent audit report finding is due in early December, per LDK. The company has net profit margin in the 30’s and projects to grow revenue at the rate of 100% for the next few years. Polysilicon supplies to produce the wafers are in short supply but production on a large scale is expected to come online in 2008.

To accommodate this purchase, we sold Canadian Solar (CSIQ) at $14.30 per share for a short-term profit of 35% in less than a month. Improved profit margin expectations, polysilicon and solar cell supply contracts along with beating expectations in Q3 caused the shares to pop about 80% before pulling back. The stock is still valued very low on a forward P/E basis but it is uncertain whether the company can grow margins going forward.

The list of stock/options sold during the year and the gain/losses are listed below:

Stock	Buy Date	Buy Price	Sell Date	Sell Price	% Gain (Loss)	% Portfolio Return*
Harrah’s (HET)	10/2/2006	75.61	8/7/2007	83.68	10.66	0.62
St. Joe (JOE)	8/7/2007	39.4	8/8/2007	41.8	6.23	0.47
Google (GOOG)	3/14/2007	441	8/10/2007	515.99	16.86	1.14
LOCM (LOCM)	8/10/2007	5.47	9/17/2007	6.094	11.31	0.71
PetroChina (PTR)	9/12/2006	106	10/1/2007	188.5	78.14	2.83
PetroChina (PTR)	9/12/2006	106	10/3/2007	178.05	68.39	2.2
ValueClick (VCLK)	9/12/2007	19.4	10/12/2007	28.28	45.79	3.38
Canetic Resources (CNE)	11/2/2006	13.95	10/26/2007	15.88	13.78	1.06
Harvest Energy (HTE)	11/2/2006	23.46	11/9/2007	26.39	12.5	0.95
Canadian Solar (CSIQ)	10/30/2007	10.60	11/21/2007	14.30	34.9	2.82
Suntech March 45 Call	-	-	10/15/2007	5.00	-	-
TSM April 12.5 Call	-	-	10/18/2007	0.35	-	-
Realized Gain/(Loss) YTD	-	-	-	-	-	16.17

• % Gain/Loss Relative to Portfolio Value at Beginning of Year + Deposits
• The table assumes realization of profits associated with selling options only after the option is exercised or expiry.

Here is our updated Stock Portfolio:

Stock	Buy Date	Buy Price	Current Price	Current % Of Portfolio	Unrealized % Return	Current Yield
Philip Morris (MO)	1/4/2005	46.54	72.41	9.29	55.58	4.29
Kraft Foods (KFT)	1/4/2005	21.11	32.81	2.90	55.40	3.15
Plum Creek Timber (PCL)	5/12/2005	35.5	41.88	8.06	17.96	3.74
Pfizer (PFE)	2/6/2006	25.15	22.35	5.73	(11.15)	4.63
ICICI Bank (IBN)	5/18/2006	27.57	56.10	10.79	103.46	0.92
Taiwan Semi (TSM)	7/27/2006	8.71	9.31	5.97	6.86	3.4
Advantage Energy Fund (AAV)	11/2/2006	11.22	10.91	4.55	(2.80)	15.03
SunTech Power (STP)	3/14/2007	36.73	45	5.77	22.53	0
Central Europe & Russia Fund (CEE)	6/28/2007	51.5	58.65	5.64	13.74	9.6
Patni Computers (PTI)	8/10/2007	20.85	15.20	4.87	(27.15)	0.64
Bank Of Ireland (IRE)	10/1/2007	76.43	55.50	4.45	(27.39)	4.5
Asure Software (ASUR)	10/5/2007	1.31	1.35	4.33	2.95	0
Frontline Limited (FRO)	10/26/2007	43.51	42.38	5.44	(2.59)	13.81
Itron Inc. (ITRI)	11/07/2007	85.01	74.5	4.78	(12.47)	0
Anthracite (AHR)	11/09/2007	7.97	7.52	4.82	(5.64)	0
ClickSoftware (CKSW)	11/09/2007	4.61	4.53	2.90	(1.75)	0
LDK Solar (LDK)	11/21/2007	30.30	30.28	9.71	(0.07)	0
Cash				0
Total Portfolio					8.46

• For SunTech Power (STP), we wrote a call option for March 45 (see first table) and so the price is listed as $45 as we won’t participate in the appreciation beyond that plus the premium received.

A detailed analysis of LDK Solar will follow.