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around July of last year, during that time, I made 10 times paper profit on abk, 5 times paper profit on mbi, then financial panic of Leh bankruptcy wiped out almost all of my paper profit. But still, now my shares of abk and mbi are all free, they are coming from trading profit.
I buy bond insurers because of its unique business model, because of its persistent insider transaction, because of financial panic, finally, gurus like Warren Buffett, Whiteman likes muni bond insuring business:
Here are some links you may find useful to understand their business model, and mark to market accounting method's impact on them:
http://www.gurufocus.com/news.php?id=34381,
The Impact of "Mark to Market" Accounting on MBIA and Financial Guarantors:
http://www.mbia.com/investor/publications/MarktoMarketPrimer.pdf
Insider transactions:
http://www.form4oracle.com/company?cik=0000814585&ticker=mbi
Third avenue hedge fund's letters to shareholders (Marty Whiteman):
http://www.thirdavenuefunds.com/TA/shareholder-letters-mf.asp (read Whiteman's comments on abk and mbi)
There are more info out there, like blogs section on yahoo finance on individual stocks.
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