Advanced Micro Devices - Moderated (AMD) Message Board

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Technology Stocks : Advanced Micro Devices - Moderated (AMD)

AMD 206.14

-4.1%

Nov 25 3:59 PM EST

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To: DRBES who wrote (123753)	6/15/2004 9:47:57 AM
From: Biomaven	Read Replies (3) of 275872

AMD looks to me to be an intriguing story - enough to lure me out of my normal biotech-only haunts. I've only been reading the thread for a week or two, and while I see a lot of good fundamental information I don't see much in the way of long-term trading strategies apart from the simple "buy AMD." Seems to me the situation cries out for a paired-trade - basically long AMD and short INTC. Not sure what the optimal ratio is - AMD is more volatile than INTC but has a lower stock price. So one-for-one in shares might be about right. You could also play with options - for example something like buying a Jan 05 AMD $20 call and selling a corresponding (i.e. slightly out-of-the-money) INTC call. The 1-1 paired trade would have done very nicely January through mid-April 2004, but then badly through the mid-May, giving up nearly half the previous gain (with around April 23 being the big problem). It's essentially flat since then, with a slight upward bias. Comments? Peter

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