| Market Watch : If the memory of the the '00 tech massacre has sent you dashing for cash, your decision is coming at precisely the wrong time; particularly if you fall into the buy-and-hold category of investor. Investors will have two things going for them in 2001: 1) institutional buyers are reverting to making rationale investment decisions based on fundamentals and risk/reward consideration; 2) there is actual value to be found in the marketplace.... These are words that traders will not be happy to hear. Even in last year's rowdy market, the environment was still ripe for traders to strive, as volatility was at an all-time high and capital continued to swirl around the markets.... Would expect money to continue flowing away from the tech sector this year, leading to wider spreads and less liquidity. This means that former favorites may have to be dropped from the trading hit list, based on an inability to navigate the stocks without sacrificing a pound of flesh in transaction costs.... Broadening out to other sectors will help offset some of the lost opportunities in the tech space. Traders should look for momentum opportunities in retailers, healthcare, oil services, and the financials.... The true speculator should spend time formulating a roster of smaller-cap momentum names in these sectors with a history of participating in theme-based advances. In the retailer category, for example, a proper list would include Hot Topic (HOTT), Abercrombie & Fitch (ANF), BEBE Stores (BEBE), and Wet Seal (WTSLA). On the healthcare side, WellPoint (WLP), Oxford Health (OXHP), Pharmaceutical Product (PPDI) would find places on our radar.... Instead of the 7-10 pts that momentum players looked for in the past, be happy with 1-3 pts. Traders should remember that boredom-induced transactions lead to losses. So pick your spots and stay disciplined.-- Damon Southward Briefing.com |
