Added Direxion Financial Bull 3X Shares (FAS)

We used about 30% of our cash to add Direxion Financial Bull 3X (FAS) shares to our portfolio. The ETF tracks the daily performance of Russell 1000 Financial Services Index at 3X leverage. That is a capitalization weighted index of 200+ large financial services companies. By nature, FAS is extremely volatile because of the 3X leverage and corresponding daily return. For example, if the underlying index moves 3% in a given day, FAS would move 9%.

This is a speculative trade and the holding period will most probably be in days rather than months or years. Also, leveraged indexes are not suitable for longer term holding periods in any case – we will look into these products in greater detail in another post.

Below is our updated portfolio - it is more than 40% in the red:

Stock	Buy Date	Buy Price	Current Price	Current % Of Portfolio	Unrealized % Return	Yield as % of Portfolio Value
Altria (MO)	Various	16.69	16.91	5.37	1.35	0.41
Philip Morris International (PM)	1/4/2005	32.19	37.16	8.98	15.43	0.47
Kraft Foods (KFT)	Various	24.03	22.87	4.84	(4.84)	0.25
Pfizer (PFE)	Various	24.37	14.15	7.49	(41.93)	0.33
ICICI Bank (IBN)	5/18/2006 and 08/01/2008	25.28	12.63	6.68	(50.03)	0.29
Advantage Energy Fund (AAV)	11/2/2006	11.22	2.73	1.44	(75.68)	0.20
Central Europe & Russia Fund (CEE)	Various	39.23	14.18	5.25	(63.83)	0.03
Patni Computers (PTI)	8/10/2007	20.85	4.87	2.58	(76.66)	0.07
Itron Inc. (ITRI)	11/07/2007	85.01	44.30	4.69	(47.95)	None
Anthracite (AHR)	11/09/2007	7.97	0.76	0.40	(90.46)	0.00
ClickSoftware (CKSW)	11/09/2007	4.61	2.87	3.04	(37.74)	None
Harvest Energy (HTE)	11/28/2007	21.01	3.78	1.60	(82.01)	0.20
iRobot (IRBT)	12/18/2007	18.65	7.77	3.29	(57.98)	None
LDK Solar (LDK)	01/22/2008	30.49	4.36	1.38	(85.70)	None
Aegon N.V. (AEG)	04/28/2008	15.99	3.16	1.00	(80.23)	0.00
LM Ericsson (ERIC) Call Value	05/05/2008	11.83	7.50	6.35	(36.59)	0.16
TD Ameritrade (AMTD)	05/21/2008	17.68	12.27	5.19	(30.62)	None
Trina Solar (TSL)	06/06/2008 and 07/31/2008	45.61	7.50	3.97	(69.88)	None
Costco (COST)	08/01/2008	62.28	42.12	4.46	(32.37)	0.07
Frontline Limited (FRO)	10/06/2008	36.95	16.95	2.69	(54.13)	0.16
DryShips Incorporated (DRYS)	02/09/2009	6.96	3.80	2.81	(45.43)	0.00
Direxion Financial Bull 3X (FAS)	03/16/2009	5.09	4.87	5.15	(4.32)	0.00
Cash				12.46
Total Portfolio					(43.89)	2.63

• For Altria and Philip Morris International, assumed spin-off ratio of 30.83:69.17. Altria is yet to supply the cost-basis info
• For Ericsson, we wrote April 7.5 covered calls on them at 0.95