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Politics : Formerly About Advanced Micro Devices
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To: Charles R who wrote (112606)5/25/2000 10:30:00 AM
From: xun  Read Replies (2) of 1580102
 
Chuck, RE

<How true! I backed up my truck when AMD "puled-back" to low-80s. Looks like I tied-up
my funds a little too early.

Here is an interesting dilemma based on the AMD price action in the last couple of
days.

I have been writing 80/85/90 puts over the last month or two thinking AMD would not
correct more than 10 or 20 percent but given how this market has turned out and how
AMD stock was not able to hold the 70s, I am wondering if it make sense to take a
little bit of additional risk and write a few at-the-money puts now.

How low could e possibly go from here? Would I end up tieing up some serious cash if
Nasdaq were to go to, say, 2400. How much cash, as a percentage of portfolio, are
people keeping handy? Any thoughts?>

I borrowed 17% on the margin as of today. I wrote 20 July 70 puts a month ago that tied my money. I know it's time to pick bargan basement. But I will sit idle for now. 15% on the margin is my threshold. I am not willing to cross it at this moment (actually the market helped cross it already). I am 90% in AMD (shares+options).

<What news is out there in the very near term to support the stock from sinking from the
current levels?
- Stock split (highly likely)
- Thunderbird/SPitfire launch (highly likely by June 5th and 99.999% before end of June)
- Earnings preannouncement (highly likely)
- Blowout Earnings (almost guaranteed)
Anything else?>

I agree those are legit coming events. The AMD price movement so far today suggests somebody wants to keep AMD down badly. The last time it happened, AMD shot up nicely afterward. So I think sitting idle is the next best thing to accumulation for AMD.

panic
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