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Technology Stocks : PALM - The rebirth of Palm Inc.
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To: sunfish who wrote (3277)1/4/2001 6:37:00 PM
From: Mang Cheng  Read Replies (1) of 6784
 
sunfish, thank you for explaining your strategy. I tend to agree with you almost 100%. The problem was I didn't use such strategy last year. There are two reasons why I couldn't employ such strategy at around the end of 2000 :

1. We underestimated the downside risk of Palm. I thought $45 maybe $40 was the lowest it would sink. I then loaded up around this $40-$55 level. If we had listened to the short-sellers, the downside risk was actually at $15-20. The subsequent actual drop to $22 really screwed up all my other plans.

2. Most small investors (that's me) have a serious pyschological barrier - when I sold a stock (or even just a small portion) and if it goes up more, I'd feel extremely depress, angry, frustrated and totally lost control. Whereas if I bought a stock and it went down, I wouldn't feel a thing since I would be hopful that it would come back up very quickly. I am glad to report that starting 2001 I have conquered this barrier. From now on, I won't give a hiss if I sold a stock and it goes up more - for I know it will eventually come back down - havn't we seen enough of this in Palm last year ? I just have to follow a pre-set strategy similar (not 100% the same) to the one sunfish outlined.

Mang
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