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Strategies & Market Trends : The New Economy and its Winners

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To: Robert Rose who wrote (700)	6/2/2000 12:26:00 PM
From: Wizard	Read Replies (1) of 57684

I'm diversified bro. If you do the math, holding 10% cash or margin really doesn't change your exposure much. However, I almost always buy something on really big bad days because illiquidity can take stocks down so much and create extremely attractive entry points. Because we have had so many big bad days, my leverage has crept up a little as I have added. To offset a little bit of the risk of huge intraday moves on a panic, I have been using HOLDR's as they are 20 stock securities and are therefore a little diluted in terms of their volatility. I generally take/sell some of my higher cost shares out on huge up days. Many stocks are selling at 50-60% off (admittedly inflated) levels. I may have OD'd on Kool-Aid but I will take my lumps and rotate into the strongest companies I can find. While its true that valuations are not cheap and the fear that some investors of blowing up could take us lower - never underestimate the greed factor. Greed is just as strong an emotion as fear and at some point in the next 12-18 months, we are going to get a huge rally based on short-covering and investors piling in and not wanting to miss out...

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