Hi Frank,
Many thanks for your kind words. I'd like to say that the feeling is quite mutual as far as owning INTC (and MSFT) and sharing the same convictions are concerned.
INTC/INTCW are among the 5 stocks in my "heritage portfolio." The other 4 are MSFT, CSCO, CCI and LU, the last being a rather recent additon since its IPO a year ago.
INTC: I started buying this stock since September 89 at the split adjusted price of $10-11. Ever since the first lot I have been adding shares on dips, such as the occasions of a Kurlak downgrade and announcement of massive capital outlay. Over the years I did set aside a percentage and traded partially (usually no more than 25% of the total but less than 5% for each trade), but there was always regret felt afterwards, as I invariably had to pay a higher price to replenish.
The warrants were bought mostly in one chunk in March 1994 at $11-14 after I became aware of its existence from WSJ. I sold 10% last year right before the stock's life-off, and that was the only time I ever waverd on this great company. Needless to say I am still kicking myself for it.
Friends of mine who actively traded INTC/INTCW found themselves doing no better than my rather "inactive" approach. This was a conclusion reached after 5 years of experiementing. These folks are not unsophisticated traders; one is a math professor fully equipped with intricate models, softwares and the whole bit.
The problem of doing market timeing by small investors is, I think, that you have to be right TWICE consecutively, and anyone having knowledge of probability could tell you the chance of winning is cut drastically over the long haul. My smart trading friends usually got out with the right timing, but getting back in is another story. It is extremely difficult to tell a false start from the real thing, despite the technical experts' claims to the contrary. And when the latter happens it usually does it so fast that the snall investors are left in the dust. But I do trade actively on my 2nd and 3rd tier stocks, especially the tech issues.
The biggest setback for Intel that I can remember was mid-1995 to early 1996, during which the stock fell 25-33% due to transitioning into Pentium chips. in July 1996, both Intel and Microsoft held extremely well; I don't remember a greater than 5-8% decline in either case.
As to margin account--no, I haven't used it as my main investment vehicle, although the access is there, quite readily so. That is because I consider myself a rather conservative investor--aiming at an average annual return of 35%--by picking the right companies at the right time, in line with macro economic environment as well as specific product cycles.
Additionally, my buy-and-hold approach to a specific company would immediately cease if there is no visibility of new, substantial products in the pipeline. This is the same approach used by most companies in high growth industries (such as high tech/biotech) when they search for merger/acquisition targets. I use it and it worked for me.
A few years ago, when I hardly had the time of checking INTC prices more than once or twice a month--and there was neither blessing nor trashing by folks on SI--the stock performed just fine. Thus I concluded that my current close vigilance of INTC is really not necessary; it is probably more of an intellctual pursuit than anything else, although our fellow threader KAS might disagree. :-)
Best regards and keep those excellent posts coming,
Ibexx
PS: I apologize for the rambling; the late hour does permit me to proofread carefully... |
