Anyone following Capstead (CMO)?? Message Board

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Strategies & Market Trends : Anyone following Capstead (CMO)??

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To: James H who wrote (115)	9/25/1998 1:09:00 PM
From: James F. Hopkins	Read Replies (1) of 216

James; I guess every one who sold thinks you can be on the right side of the curve 100% of the time. CMO took her hit on the IOs up front, and the short term speculators jumped ship, then the ambulance chasers rushed her and started trying to hammer her stock into the dirt. Well she got way over sold to start with, is that not what the market does time and time again. Any IMO the IOs when sold went into LT bonds at about 5.75%, this puts her positioned to benefit from the falling interest rates. ( which could go as low as 4-1/2% easy ) & those bonds face value will go way up on that kind of move. Don't you wish now that you had bought bonds when they were 5.75% instead of the 5.15% they are now..extrapolate even .5% compounded for 30 yrs. ----------------------------------- At her worst case IMO $6 should have been oversold, the hammering the ambulance chasers did caused some needless panic. I also note that the cheapest insiders have got options is in the 10-12 range..and there has been no insider selling that could be looked at as them dumping. ( one seller of about 6000 shares is nothing to what the insiders hold ) -------------------------------------- I'm trying to write some covered calls on her today , March 7.5 @ 1/2, if they don't take them I won't try again till she hits 6, and I see that before long. Someone knows her paper never did drop below the $8 range, and is now well above that. -------------------------------- The whole thing was tied to her reposition for lower rates, what do the ones selling think she should have done, and if the IO thing was wrong so what, it was a small part of her portfolio..who can be right all the time. Jim

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