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Technology Stocks : American Power Conversion
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To: Tom Reck who wrote (1693)7/29/1997 8:41:00 PM
From: shane forbes   of 2574
 
Tom you hit the nail on the head re: the capital gains tax. On average the market gets pounded pretty heavily for about the 6 months after such legislation is passed. Especially with the huge unrealized gains sitting in so many portfolios. Add to this the possible interest rate hike. And the abysmal performance by gold. And the ingrained buy-on-dips thinking that has permeated the collective investor conscience and things just look too rosy. But the catalyst is the cap. gains tax. I've structured my stocks to be in the small caps that have been pounded (don't like the "safe" big cap type stocks like medicines, food etc. too dull.) and I'm keeping my fingers crossed that my limit sells on my other stocks get executed. If not, like you, I'm not concerned. I'll wait it out and buy-(more)-on-dips ;-). I hold LSI and I've posted comments about a possible sept./oct. decline on the SI LSI thread. Of particular relevance to the computer and peripherals sector is the high valuations of many of the leaders. To check this out just glance at the recent Value Line and see how low the expected 5 year return on many of the stocks in this sector is. (There are exceptions.) They have discounted a lot of the future. Computers and PCs underpin a lot of the tech market. The big caps in so many sectors are selling at historically high P/Es. I could go on... (Of course this is idle speculation and everyone has to make his/her own assessment.)

$-)
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