> ...never see these levels of SUNW again...would you agree? <
Short answer: Setting my aversion to absolutes aside, if "they" were not selling into this mini-rally so enthusiastically (25 to 27, now back to 26), I would be tempted to agree. Believe me I WANT to agree, but I find I cannot quite bring myself to do so.
Long answer: ...read on at your own risk.
As a devout coward with a world-class track record as a contrarian indicator, any time I am even tempted to think "This cannot possibly go any lower", alarm bells go off. Even if I do opt to re-enter soon, I will phase back into a full position gradually – say 500 shares at a whack. Although many believe it to be ill-advised, I have been well-served by averaging down. If you keep buying in constant dollar amounts, your POP (point of profitability – yeah, I made it up) continues to drop, and barring bankruptcy, you ultimately make out OK. I may also use some covered-call writing to further lower my entry cost. SUNW calls command an excellent premium. For example, today one could have (via limit orders) purchased shares for 25 and sold Jul 25 calls for 7. That represents a 38.5% ROI if this IS the bottom, and an entry cost of 18 if it is not.
Well, that is my 2-cents worth. Thanks for the response.
Paul |
