Hi Kemble,
Yeah, entertainment cost money, especially in Las Vegas. But always have to have a revenge plan. Today I shorted Mirage - MIR (which owns Bellagio) big time at $ 16/sh. (see my post on Mirage thread). Based on what I saw and being in October the stock will head south (see below).
We have the October syndrome. Eleven years ago today (Oct 19, 1987) the market crashed about 580 points on the Dow. Today, cooler head prevails. Yet we are facing with tax loss selling by mutual funds which have to take the loss in October.
Mutual funds will sell weak stocks and take tax losses to offset tax gains. This is to avoid angry customers in cases where the fund had a negative performance for the year, and yet the customer is faced with capital gains (this can happen because the fund sold winners prior to July and holds the losing stocks).
Now let us look at Dell. Top funds (like Janus family fund who did sell a small portion of its holdings in Dell, like 320,000 shares) will keep the winning stocks like Dell, especially knowing that in November the company will announce earnings. That fund will have a capital gain which have to be passed on to shareholders. To reduce tax on the gain, weak stocks like Mirage are liquidated.
Whatever October-phobia there is, goblin, ghost, monica, 1929, 1987 etc etc, I can sleep well with my strong stock holdings, especially Dell. Stocks which have taken terrible beatings will unfortunately come under more pressure this month.
There my friend, my reasoning for being confident that Dell will be at least $ 55/share by Nov. 20
BTW, whenever you go to Las Vegas (or should we say Lost Wages), let me know so I can give you some useful info for a first timer.
Regards
PAL |
