Guest Blogger James Altucher: His Picks For Contest

We add another guest blogger to our site--James Altucher, who is a regular on the contest program "How To Win." James joins Jeff Mishlove who also appears on "How To Win," and both will write about their picks and sometimes their pans (we hope not to often on that last part). Here's what James sent us today..

Whenever the "How To Win" people call me to go on the show (for which I am thankful they think of me) its always a challenge to come up with picks to recommend for the contest. The reason is that in order to win one of the weeks in this contest, you need to gain 20-50% in a week. And the only way to do that is to take big risks. For instance, if you owned DNDN  last week you would've done great. It was up 200%+. But if they failed an FDA trial, the stock would've gone down 50%. That's the nature of winning stocks in this contest.

So I gathered together about 15 stocks, only a few of which I was able to talk about on the show. Fortunately, starting last Wednesday, I spoke about KRY , which is up a solid 40% since then. And I spoke this Friday about KRY and GPN , which are also up. But the flip side is I've been speaking about the subprime lenders because any piece of good news at all will send them up 100%. Alas, we've only had bad news on those guys.

For the full list of companies I prepared for Friday, many of which are still valid plays for the contest, you can check out my portfolio page for the full analysis of each stock. Some of the other plays include CHINA, or clean water company, INSU , which had a terrible week last week (hence my reason for betting on a snapback).

I like the snapbacks and any stock dropping on huge volume. Its always helpful to view the 52 week lows  particularly those on the 52 week low list that are owned by solid hedge funds or mutual funds. For instance, AMD , in the above link, can be seen to be hitting a 52 year low but is also owned by a solid tech hedge fund like Andor. They are probably buying up shares on this dip so its probably not a bad bet here for at least a snapback.

I'll have more picks over the next few days.

James Altucher is a contributor to Realmoney.com and is a managing partner at Formula Capital, an alternative asset management firm that runs several quantitative-based hedge funds as well as a fund of hedge funds. He also is the author of the recently published book, Trade Like a Hedge Fund. Previously, Altucher was a partner with technology venture capital firm 212 Ventures and was CEO and founder of Vaultus, a wireless and software company. He holds a bachelor's degree from Cornell and was a doctoral candidate at Carnegie Mellon University.

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