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Strategies & Market Trends : Value Investing
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To: Tim Cruise who wrote (4490)7/24/1998 4:19:00 PM
From: Michael Burry  Read Replies (2) of 78715
 
Tim,

Actually, I sold out of TBR a few days ago at 121. Several reasons:
1) I needed cash for home repairs
2) My small allotment of shares was way too small to be split
into twelve companies without commissions killing me on any
future exit. Not to mention stretching the limits of my mental
tracking mechanism.

My feeling is that the HOLDrs are temporary and therefore not a good vehicle. Also, why pay the 1.50/share that my broker wanted. Twelve companies wouldn't do with my small holdings. And there are a zillion analysts following this thing. As we hit mid-July, it wasn't looking to zoom higher than 120ish pre-split. I felt that despite all the indecision, the market was rendering a verdict - and that verdict was factoring in an expected post-split fall in the less liquid shares. So I sold - it was a relative decision. I needed to liquidate about 25%, and I couldn't bear to sell much of anything else in the portfolio. My plan is to purchase individual babybras as warranted on a value basis post-split. I too expect there will be quite a spin-off downdraft effect on the less liquid shares that may create significant opportunity a la MWY. If we're lucky, even the big ones like telesp may fall with a world bear market.

Good investing,
Mike
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