AMERICAN BIOMED, Minimally Invasive Technology (ABMI) Message Board

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Microcap & Penny Stocks : AMERICAN BIOMED, Minimally Invasive Technology (ABMI)

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To: Y2k_fan who wrote (209)	3/17/1998 11:44:00 PM
From: Jeffrey L. Henken	Read Replies (1) of 2887

OFF TOPIC: I'm sorry to offer unsolicited advice and I hope you will not be offended. In fact I love your stock portfolio and honestly think you will do great if you simply hold but it's not how much taxes you pay it's how much you get to keep after you pay your taxes. The point I'm trying to make is that you can and should be willing to take profits at the right time in any stock. IBM did not run higher forever. Even MSFT will someday crash. Perhaps that's why I see Bill Gates taking profits along the way. Unfortunately for me I have learned the hard way that stocks do not run forever. Here are a few good rules of thumb that you can try to use to help you determine when a stock is overvalued. Lets start with a stock like JNJ with a proven history of profitability I would watch the PE. If your stock trades above the historical PE range at a lofty PE it's time to take some off the table. This is something I should have done with NN last October. Here is a second rule to watch for that will work well with any of your stocks. If the investors are getting too euphoric then the stock will probably be due for a correction. This is especially true with large companies that get lots of press coverage. I live just outside of Boise and Micron is the big industry here in town. Every time the local newspaper runs one of those stories about how wonderful Micron stock is doing you can count on the stock turning south. How about the smaller stocks in your portfolio which still have no actual earnings but vast potential? I would suggest you set some realistic goals for these stocks and take some money off the table when your goal is achieved. I love ABMI but it won't run higher forever and neither will any of these other stocks. This is a lesson I have learned many times over and I think everyone here should feel good about taking some money off the table at some point in time because there will always be another winner out there like ABMI but we all have only have so much money. Don't marry yourself to a stock. No not now, right now back the truck up! Big point: Even if you pay Uncle Sam more in taxes it doesn't matter as long as you have more left over than you would have by holding a stock that turns south. Regards, Jeff How a

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