Thank-you for the clear explanation of option roulette.
Now, since shareholders will be left holding the bag eventually, we must conclude that some Greater Fool Theory has been at play to account for the tremendous appreciation during the last decade.
So the question becomes "When will the world run out of idiots?"
I believe, a few months ago, you've posted as close an answer to this as one can reasonably expect, given the fogginess of crystal balls --- When the boomers decide to enjoy their gains.
Are you beginning to change your mind? Recent posts seem to point to the discovery of some blue smoke and magic mirrors in Optionland. If true, we can expect a mass removal of rose-coloured spectacles and an accompanying share price collapse. Or do I see a darker picture than the one you're painting.
Cheers, PW.
P.S. Over the years, CSCO has been a very good investment. Trouble is, when something looks too good to be true, it often is just that, too good to be true; hence, my scepticism gets aroused. But when I first began suspecting CSCO of being too good, it was trading at 3-5 and rising while it's earnings growth was slowing. I continued to hold because its 19 PE seemed reasonable. |
