Jules,
It is a nice problem to have-and how can you not love a company like Intel.
I wish I knew the solution. I can say with certainty that the solution is NOT to write calls against your Intel stock. Everytime, I have done this, the stock moves up big and I have to cover or get the stock called. Even when there is little time left on the option-how long does it take THIS stock to move 5 points?
Whether, shorting another stock helps protect intel is the question. It worked for you with IBM. I shorted (bought puts) on MU, as I believe it is the most over-rated and weakest of the chipmakers and therefore the most likely to fall during a SELL-OFF-so far the stock has moved up, even when the dow and NASD moved lower.:(
I looked at the premiums on the intel put leaps and I just couldn't see how one could pay that much premium on a stock that basically one is long term bullish on.
In summation Jules-I believe it was in one of your posts that you talked about the difference between your investment style (L.T.Investor) and Jacks (Trader) in which you stated that for a long term investor you pick the good companies with good management and providing those to things continue you don't concern yourself with day to day ups and downs of the market and forget about trying to time the market also. That advice was the best I've heard-you are my hero :).
Certainly, if I'd just bought intel on the dips-forgot about trying to "time" the market, the options, the LEAPS, the interest rates,Greenspan, overseas markets, etc., I'd bee way ahead. Incidently, the same goes for my other holdings, Cisco and Sun, not only would a buy on the dips hold long term have worked better-but I'd have less gray hair and get more sleep.
In my opinion you had (have) the answer, search no more.
Regards
Ray
P.S. If any of you considerate fellow stockholders would remind me from time to time what I just wrote-especially when I get the urge for "action" or fear of loss.
Regards
Ray |
