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Biotech / Medical : Guilford (GLFD) - Steadily Rising
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To: Vector1 who wrote (139)10/29/1997 11:53:00 AM
From: tdinovo  Read Replies (1) of 496
 
V1,
I think the action in Guilford (and all the other bios, for that matter) is market driven in this instance as opposed to news driven. Our bedfellows in these stocks are some of the most aggressive mutual funds on the planet. That's both a boon and a bane. When the stocks are moving, these managers are willing to buy at prices that intimidate other managers. Since they typically buy across a wide spectrum of technology platforms, they are exposed to a wide variety of risks.
In this most recent turndown, their exposure to the semis was dramatic and they moved down quite quickly. When redemptions started pouring in, they were loath to sell the Asia-sensitive stocks at a loss. As I (and several others) noted, initially the bios held up well, to their later detriment. They then became prime vehicles to raise funds. As the decline accelerated, it undoubtedly triggered margin calls for individual investors, which further exacerbated the situation.
On an objective basis, the bios could hardly be more disconnected from events in SE Asia. Once things stabilize (and I don't think they have yet), there should be tremendous opportunities in a whole range of issues. That will be the time to increase exposure to Guilford and a number of others with solid potential.
Ted
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