re: a price, stock, cash table:
Yes, I think that's the way to do it. Rather than trying to pick a top in the market or a stock, I'll be incrementally selling (and hedging) as the market goes incrementally up. I'm fairly certain current valuations are unsustainable, but I'm very uncertain about where or when the market turns down.
As I've said previously, my targets are:
at Nas 1000: 40% margin
at Nas 1400: 100% long (0% margin, 0% cash)
at Nas 2080 and higher: 60% long, 40% cash. (Alternately, I may establish an equivalent balance, using: higher long %, put LEAPs, and less cash.)
My 60% long position includes a lot of longest-term LEAPs in high-beta techs, all bought in late-September-early-October, so I'll be getting richer, probably at least match the market upmoves, even while sitting on 40% cash.
For AMAT specifically, I will hold what I now have (lots bought at 27.5 and 30); add more in 2.5-point increments, from 35 on down; hedge with NVLS put LEAPs, with AMAT at 50 and up.
As of today, with the Nas almost at my 2080 target (50% rally off the recent bottom), I am not at my target. I need to raise cash from 23% to 40%. For tax reasons (and because every chart I look at is so pretty), I'm going to gamble, and not raise more cash till January. |
