Literally, a theory that states when man is set against impossible odds, his final bullet will be on himself rather than his enemies. Figuratively, a plan to "cut one's losses" or make sacrifices as a last resort.
So, yeah, according to Mike's single bullet theory, he's gonna play the market right out to the bitter end and try to cash in on as many stocks as possible; however, things don't look good.
Other than an inflatable beach toy, beachball is a common term used at beaches between males to announce the presence of an extremely attractive female without drawing attention. It is usually placed in a question followed by a time of day to signify the direction of the female relative to the speaker.
Teddy: "So you coming to the party tonight?"
Mike: "No, sorry, I'm playin' some beachball at 3 o'clock."
Teddy: "Oh, really."
Teddy glances to the side.
Teddy: "Hm, maybe I'll join you."