The Skousen Hedge Fund Trader (www.markskousen.com) may now hold the world’s record for best return in one day: 9,100%! When Warren Buffett announced Monday morning that Berkshire Hathaway bought out chemical company Lubrizol (LZ) for $135 a share, our March $120 call options went from 15 cents to $13.80 almost immediately.
If you annualize it, the calculator can’t handle it; it says the return is “infinite”!
Here’s the full story: We recommended Lubrizol last October, and were underwater on both the stock and the call options. The stock was down 7%, and the March $120 calls had lost 97% of their value when Buffett bailed us out. Subscribers who initially bought back in October made 20% on the stock, and 150% on the calls. Not bad.
I don’t know if any subscribers bought the March calls (which were due to expire this Friday!) for 15 cents a week before, but if they did, they made 9,100% in one day!