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Technology Stocks : Redback Networks, Inc. (RBAK)
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To: Tom Hua who wrote (1130)9/22/1999 10:40:00 AM
From: Wizard  Read Replies (3) of 1956
 
>>who's more knowledgeable about the company's direction (and stock price) than the CEO

That seems to be the most popular argument on SI: if insiders sell, the stock is going to tank.

In my experience - with premiere technology growth stocks only - this action by insiders is not only a poor indicator, its a good way to buy into stocks at lower prices. Insiders are always selling when stocks go up (managements of good companies and shitty companies alike). If its a shitty company, its should be traded from the short side and if its a good company, it should be traded from the long side - its that easy. Redback is a very good company and should not be shorted, in my opinion. Trade in and out from the long side but or don't play.

Even in extreme cases like Priceline, unless you just chased the stock and bought it in the hundreds, your loss is really not important if you have a diversified portfolio. Assuming a 2% position and a $99 entry price, you have only lost 50 basis pts of your portfolio value.

Redback is a much better buy at $99 than PCLN was at $99. Priceline is conceptual and is a leap of faith in that concept. RBAK has a great product targeting very large markets and is a core internet infrastructure holding, IMO.

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