Ken: So, where will it be on 12/31/2001?
That is a great question, JDN ... every month since last January, my focus has been on the short-term (the next few months) ... which is a different mentality than I had previously ... I had thought of myself as a long term buy and hold person during the three year period 1997-1999 ... I started building a position in SUNW in May, 1997 ... I then started selling it in October, 1999 and by January, 2000, I had sold all of it (except for the small position I bought 3-4 months ago)
... there is quite a bit of uncertainty in my mind about equities in general ... my readings and instinct tell me that unless we are entering a serious recession (not very likely) that would seriously hurt the value of the dollar, then we might start to see the beginnings of a recovery in April (if first quarter earnings that will be reported then start to look like the economy is getting back on track) ... if an April recovery starts looking real, then hopefully we will have a steadily improving U.S. stock market into the end of the year
... my biggest concern is if we do head 'south' from here to the tune of another 30% correction in the DJIA, S&P 500, NYSE Composite (along with some further erosion in the Nasdaq Composite) ... then the 'baby boomer' money might not reenter equities in any volume for quite some time ... I do not think that scenario is likely, but my guess is that there is a 25% probability it will happen ... and if it does, all bets are off ... we could be in trouble all year
... I do think we are looking at a 20% correction in 'old economy' stocks in January ... I would say that has about a 75% probability
(1) ... so my strategy is to hold my ABMD until just before clinical trials start, which I believe (hope) will be in March or April ... I will then sell half of it and hold the rest long term
(2) ... hold my 1,000 shares of SUNW long term
(3) ... sell my three S&P 500 March 'puts' before the end of January ... actually, I may sell the one with the largest profit in it early this week
(4) ... continue studying the trading of futures, and get more active in that ... so I can be both long and short different commodities at the same time
(5) ... build more and more cash - putting much of it into treasuries
(6) ... start considering more tech stock purchases in April depending on how things look then
(7) ... I have no plans to buy any more stocks for now
Disclaimer: The above is my personal opinion. I recommend that you do not base your investment decisions solely on any one person's views or analysis (including mine). Do your own research and take personal responsibility for your investment decisions.
Ken Wilson |
