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Technology Stocks : Altaba Inc. (formerly Yahoo)
AABA 19.630.0%Nov 6 4:00 PM EST
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To: Tim Bagwell who wrote (11386)6/27/1998 8:42:00 PM
From: Bill Wexler  Read Replies (4) of 27307
 
Funny, I remember saying the same thing when the company was trading for a measely $1 billion. I was wrong then...the same argument is wrong now.

I took over $75,000 in losses combined shorting ATHM and YHOO. If it weren't for the fact that I was also hedged with short puts, I'd be sitting on a loss well into the six figures. I wish I would've sold puts without shorting the stock!!!

I was discussing AOL on my "profits of doom" thread...

Message 5040069

The same arguments that apply to AOL apply to YHOO. My grossest mistake was betting against the most visible and compelling brand riding a new and rapidly expanding economic wave. I could kick myself because I broke a golden rule about shorting - don't do it only based on overvaluation. You can make far more money shorting a bogus company trading at 6 a share than shorting a Yahoo at 150.

Granted, the valuations on internet stocks are very decoupled from fundamentals...all that means is that volatility will probably increase. It may be stupid to go long at this point, but it is even MORE stupid to go short. Until -

1) The industry matures.
2) Much more competition surfaces.
3) The supply of stock goes up dramatically.
4) Revenue growth dampens.

and/or we enter into a recession, it isn't even worth DISCUSSING shorting the internet high-flyers. Shorting now is a complete - and dangerous - gamble.

Whenever I take a loss - I like to think of it as tuition. Hope this helps.
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