Tony,
A wise person once said "Never get married to a stock!" Since
us little investors have no possibility of really moving the
price of a stock like AOL, the best we can do is to try to figure
out if the price is likely to be moved up or down by the big
investors and invest accordingly. And in that process we need to
be aware of what is happening in both the large cap and small cap
stocks.
So, when we "know" or are fairly certain that the stock will likely
move up within a resonable timeframe we should buy -- and when we
"know" or are fairly certain that the stock will likely move down
within a resonable timeframe, we should sell (sell short if really
sure).
The name of the game is to make money on the stock transactions.
Forget the hype (if I've sounded like I'm hyping the stock, that's
not my intention), what are reasonable possibilities to occur given
the information at hand. That's what is needed for reasonable
investing.
I also think that AOL could be affected by the cash outlay for
new equipment. Todays market action was more market action than
directed at any particular stocks and therefore I tend to discount
what it would otherwise imply wrt AOL. The question is, "Will the
big investors, in the process of investing for the long term, discount
the cash outlay necessary for the equipment upgrades and buy AOL
over the next 1-2 months looking for what will occur 5-8 months
from now?" Or, "Will they short AOL at this time attempting to
push it way down in a play to then buy it back at somewhat lower
prices?"
So, what will they do? Knowing the answer now can make each of us
a whole bunch of money.
Wishing I knew the answer,
al |
