Way past time to bail. Looking for a good short, but afraid I'm too late for that. I'll keep tuning in here for ideas. Until then, I'll stand pat and be grateful for what I've managed to keep!
I would look at INTC, CSCO, or MSFT.
INTC- They haven't given nearly enough IMHO compared to the SOX. They are one of the most overvalued on the SOX. All indications are that PC sales are not materializing in Q4, but yet INTC has been relatively stable compared to everyone else who has got hammered. Also, they have crazy YoY profit expectations to live up to since they were able to muscle the ANALysts into including investment gains for the past few quarters. Their investments were in speculative crap that has been destroyed, therefore, YoY comparisons are going to be terrible no matter how good business is since they won't have the investment income. I consider this one very low risk. Any decent rally gets sold because too much smart money is looking to get out at a better price.
MSFT - ditto for the same reasons at INTC. I consider this one a little bit more risky since you never know what kind of irrational exuberance will develop if it is finalized they will be broken up and the street believes the parts are worth more than the whole. Or vice versa if the breakup is thrown off and this is viewed as bullish. Either way they are extremely overvalued and business for them is not good and the outcome won't change that. Every play on them I make I guard with calls just in case.
CSCO - I consider this the true short and hold until the bottom. No other stock is more grossly overvalued IMO and I feel there is little if any upside risk. Any rally gets sold on them. In the bull run, there was no amount of CSCO you could be long enough, in the bear run, there will be no amount of CSCO you can be short enough. I plan to cover in the single digits on this one.
Bear market rallies can be a bitch and all of these may go up more than the average should a short term bottom be hit, but if you short JNPR or AMCC or something of that sort, it could double in a few days on a monster rally.
I would recommend taking the money for each 100 shares you plan to short and set that aside. From that, buy 1 put and save the rest as cash. That way, you aren't risking much capital should things go against you, but you are still getting the leverage of being short. Of course, I view it as absolutely insane to take investment advice from some anonymous person over the Internet, so good luck in whatever you decide to do..... the best advice is probably to just go 100% cash and come back in a year to play.... |
