Al finds QQQ a very difficult stock to trade, and because of this concentrates on trading it. Trying to master something difficult is a good way of developing abilities.
Al may continue to have difficulties.
QQQ changes with time. Two years ago it had some fat pigs in it like JDSU, ARBA, CMGI. Those went down over 95% and were replaced with new pigs for slaughter.
At the same time, QQQ has great companies like MSFT, AMAT, MXIM, INTEL, etc. that made money in the bear market and are efficient, high growth companies when averaged over many cycles. They have experienced management and were not fooled to bet the whole ranch.
Then you have many "new age" companies like Cisco that were great companies but had no experience managing in a down market and Champbers himself was clueless that you just don't grow "30 to 50% forever" as he was claiming on national TV.
If I look at a "buy" I did 2 yrs ago, I bought MSFT, LRCX and SFAM on 10/17/00. QQQ was at $83 that day.
>>LRCX at $15.875 went up for a nice 60% gain and I sold those shares (and have repeated buying and selling those).
>>MSFT was $51.25 then and is now $58, up about 15%.
>>SFAM I paid $7.50 and it crashed following QQQ, I bought more at $3+ and it came back and I sold to about "almost" break even. It is even higher now at $6.33 so I'd be well ahead if I held (but I used the money to buy more LRCX where I've made even more as that is just a great stock).
>>QQQ went from $83 to $20 and is now at $28, down 66%
The largest component of QQQ was MSFT and it is up 15% yet QQQ is down 66%. I think trying to guess (or model) what something like QQQ is going to do is much like herding cats... The tabby goes left while the Persian goes right and you try to make an average line to trade. |
