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Strategies & Market Trends : Gorilla and King Portfolio Candidates
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To: Uncle Frank who wrote (14378)1/7/2000 9:18:00 AM
From: Boa Babe  Read Replies (5) of 54805
 
Good morning, Frank and thread. I'm interested in any opinion on using margin. I'm a relatively new investor, having fired my broker and taken over managing my portfolios myself in November. I've traded options in the past and have watched my investments with a magnifying glass for about three years so I don't consider myself a novice, just a newbie when it comes to being on my own.

When I had the broker (who, by the way, got me out of all sorts of junk and consolidated everything into blue chips) he suggested that when I was going to buy something big like a car or home that borrowing on margin to buy them would be the best idea for several reasons: the interest I would pay was deductible, I wouldn't lose the potential upside of the shares, and I wouldn't create a taxable event.

I've kept the margin level at about 25-29% and used a little bit to buy QCOM when the price seemed right in the 500's (now it seems like that was years ago, but it was just a couple of weeks!) Also, my investment "style" is LTB&H. I was fully invested the day the market dropped over 500 points and it all came back...I have faith.

All this leads up to my question. Why no margin "anytime", Frank? Is that because you don't feel comfortable with it, or because you have some knowledge that hasn't yet hit my brain? Anyone?

Thanks.

Kay
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