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Strategies & Market Trends : Market Gems:Stocks w/Strong Earnings and High Tech. Rank
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To: Jeff Jordan who wrote (118945)12/13/2000 5:48:03 PM
From: Dave Gore  Read Replies (5) of 120523
 
The easiest way to make big money is if there are sectors that are definitely underpriced or overpriced. That's because you can make money in calls or puts (and gain huge leverage) without having to pick exactly the right stock or time to purchase.

For instance, when YHOO and CMGI were at their peak (or anywhere reasonable close to it), you could have purchased longer term puts or leaps and gained superb leverage to do really well (even if your timing was off a bit).

Same when the SDLI's and the Handsprings and the Microns/AMD's and all the other stocks in overpriced sectors got repriced dramatically a few months back.

Those who were brave and did that turned each $10K into $30-100K in a few weeks and made the really big, easy money because put power gave them tons of leverage.

The problem now is finding any sectors that are definitely over- or underpriced. We could make an argument that the genomes are overpriced.

We could also make an argument the semi equipment stocks could be a tremendous group to go long with calls in 3-6 months particularly if they fall further. AMAT and LRCX are two of my faves but I would love to get them 20-30% cheaper in May, or just before a dramatic turnaround.

If anybody has any "Can't miss" sectors that would lend themselves to leverage investing, I'd love to hear them.
It might be worth risking $10 or $20K.
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