Siriusly?

I’ve liked Sirius for a little while. Actually, for a long time. When I first was learning about how to enter in a stock order online (I preferred phone calls), my first online stock order was for 10 shares of Sirius – which I still own today.

Not a great investment, but oh well.

Really, my interest in Sirius started well before my interest in stocks. When I lived in Virginia, there was a radio station called Q94. I’m ashamed to say that I have terrible taste in music and that most of what I listen to is pop music. But I remember listening to a song by…I think it was Busta Rhymes? Or maybe it was Le Ann Rhymes?...and then later that night looking up the song online. Well, I listened to it online and the song was just a little bit slower.

After asking a friend who had lived in Richmond a few years before I had about my observation, he told me,

“Oh yeah, I remember that radio station, they always sped up music like that.”

It blew my mind. A radio station was actually distorting its only product!

A few months later my brother, a complete music snob, had gotten XM radio. I spent an hour listening to it on the car ride to my alma mater, the University of Virginia. He was listening to a station dedicated entirely to British punk rock. There were no commercials and while I didn’t like any of the music, even someone with terrible taste in music could perceive that the music sounded like it was mixed by a very capable and professional disc jockey.

I finally understood why people liked this thing.

A few years later, when I actually became interested in stocks, I followed the saga of the Sirius and XM fight, and was mentally cheering for them to become profitable. I did not own their product, but I knew it was a high quality product deserving of the attention of the American public.

I bought a portable Sirius Radio - Stiletto 2 – about 6 months ago, and I now know without a shadow of a doubt that it is a better product than free radio.

Sirius and XM, have after well over a year of lobbyist fueled politics, merged.

Sirius’s stock price, once flying high at nearly 10 dollars in the last few years, and even above $60 at the height of the dot-com era, is down to around a dollar and a half.

That’s right, 1 share of Sirius XM, or 1/3.18 Billion of the value the newly merged company is now worth less than the extra large soda at McDonald's.

Other items worth more than 1 share of Sirius XM stock include:

1) A can of peanuts

2) A screwdriver

3) Four first class postage stamps

4) A cookie from the Mrs. Fields – which just filed for bankruptcy protection.

At least it is worth more than anything at the dollar store.

Anyway, my point of this article is to relay two of the most important lessons I (many other traders) learned over my trading life:

1. Liking a given company’s product, no matter how well developed it may be, cannot be the sole reason for an investment. Bad companies can have good products.

2. If politics – and not the market- will decide whether you will turn a profit on an given stock investment – don’t enter into that investment. The market has forces which can be interpreted, but politics is indecipherable.

Just for the record, I had bought those 10 shares for $3.53. So, I’ve lost a little more than $20.

Just half a tank of gas.

-Mansij Hans, E.I.T.

Member, Intigril Capital Management

Disclosure: Most importantly, Intigril Capital Management has never touched SIRI stock. Intigril Capital Management was started after I learned how to invest, and all of the members of ICM knew better.