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Best Opportunities for 2011

Best Opportunities for 2011

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Published by Chris DeMuth Jr
Best Opportunities for 2011
Best Opportunities for 2011

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Published by: Chris DeMuth Jr on Feb 16, 2011
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Best Opportunities for 2011

Sunday, January 02, 2011
Best Investment Ideas  Long LaBranche (LAB) common stock which last traded at $3.60 per share. The company is the parent of LaBranche Financial Services which offers securities execution and brokerage services to institutional investors and LaBranche Structured Holdings, a market-maker in options, futures, and ETFs on various exchanges. A year ago, LAB sold its NYSE designated market maker, redeemed its debt, and authorized a share buyback. 2011 will be a year for the company to continue efforts to unlock its considerable shareholder value. Short Lender Processing (LPS) common stock which last traded at $29.52 per share. The company is the nation's leading provider of mortgage processing services, settlement services, mortgage performance analytics and default solutions. The Federal Reserve’s ongoing investigation into LPS’ third-party foreclosure services to banks may lead to a determination that LPS has defrauded bank customers. Such a determination is expected within the early months of 2011 and could lead to supervisory or enforcement actions that might significantly impair shareholder value.

Alternate Investment Ideas   Long Madoff bankruptcy claims which last traded beneath $0.30 on the dollar and have significant upside due to the potential for additional recoveries from early investors. Long Illinois and Connecticut municipal credit default swaps; these are among the ten least solvent states and are doing little to correct their fiscal balance. Economically, the rest of the country could tolerate their bankruptcies. Politically, they are not crucial to the balance of the Electoral College. The incoming Congress will no longer use the Build America Bond program to prevent insolvent states from reorganizing. Long potash via Potash Corporation of Saskatchewan (POT), a broken arbitrage opportunity in which Canada has recently made a strategic decision to join with Russia and Belarus in a cartel that is both more concentrated and more price-disciplined than OPEC. Short Chinese reverse merger companies listed in the US. Dozens of Chinese operating companies have used the reverse merger process in order to access funding and list their stocks on well-regarded exchanges in the US. Many, if not most, may be de-listed during 2011 due to investigations into questionable accounting practices. Short calls on ProShares UltraShort Silver ETF (ZSL). The mechanics used by these inverse leveraged funds creates a “constant leverage trap” that degrades their value.

Rangeley Capital Best Opportunities Performance Since Inception 2009 2010 2011  Long PFN +49%  Long OSHC +27%   Long TBT +28%  Long LORL +142% 

Long LAB Short LPS

Christopher C. DeMuth, Jr.

Richard J. Townsend

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