re: the Bull fared a lot better than the Bear :
This is a straw man you're knocking down, Tito.
Your two scenarios assume either: AlwaysBullish or AlwaysBearish. Are these the only choices?
IMO,
the investor who does best in AMAT
is:
sometimes bullish
sometimes bearish
sometimes certain
sometimes confused
sometimes on the sidelines
These investors have the best chance of buying at the bottoms, and selling at the tops. And, in order to outperform the "Always" crowd (any flavor), it is adequate to just get it in the ballpark, not time it perfectly. Get it approximately right, and you can: sell it, use the money elsewhere for 6-12 months, and buy it back at a lower price. Since you usually have at least 12 months (trough to peak), it works out, even figuring taxes in.
And, for LEAPs, this is critical for success. You cannot have an "Always" attitude if you are going to use LEAPs, because even the longest-term LEAPs can expire worthless if you time it wrong. I know the mantra is, "no one can time the market/sector/stock". Anyone who believes that should never use options. I am a successful timer. My investment returns in AMAT have outperformed simple BuyAndHold, over the last 5 years, by a wide margin. And that is true, even though I tend to get out way, way before the top. As I said, all that is required is to get it in the ballpark.
Trying to time the cycles on these stocks is a difficult thing to do, and most fail. But I am a cynic and a sceptic, and most investors aren't. This gives me an advantage. |
