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Politics : Formerly About Advanced Micro Devices
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To: Mani1 who wrote (75840)10/18/1999 2:38:00 AM
From: Paul Engel   of 1581604
 
Mani - Re: "Do you mean I should buy quality companies and hold for the extra long term? Or are you suggesting adding put options to a portfolio."

First, I suggest buying only solid companies - usually the tops in their field - when these same companies have been battered down to values that a "casual investor" would think they are about to go out of business.

We are possibly approaching an OPPORTUNITY such as was available last October, 1998 - but for different reasons. (Last year was a global financial crisis - East Asia, Russia & Brazil, capped off by the LTCM - Long Term Capital Mismanagement debacle - that literally SUNK every stock - good AND bad.

Alan Greenspan and the Inflation Bears are working diligently to REPEAT last year's stock market debacle by YELLING THE WORD PANIC at every opportunity - although the ,ost of the world's economies are in a strong recovery mode (Russia excepted - probably forever !)

So - if you have any cash - or can get some - Mr. Greenspan will make some quality stock available to you very soon at VERY discounted prices.

Pick and choose carefully.

Once you buy such stocks, sell Covered Calls on them every month - to generate s small positive cash flow from your investment. If the stock rises ABOVE your strike price, you can give up the stock - or buy back the option and re-sell it at a HIGHER level for the following month. Should the stock price FALL, you end up keeping the premium and you "live" again to repeat it for another month, and you have offset a part of the decline in your stock valuation.

Paul

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