Sun,
I've been counting on this strategy taking place....
"Thanks GM. Remember what I told you in my first post here. That the big caps will lose relative strength and the small caps will storm ahead. I see a few early signs that this is unfolding according to schedule."
and it is starting to work, as you said. It does seem to be coming faster than at least I expected. But,
Until recently, couldn't decide what would get people out
of the large caps... there has to be an incentive to move into the small caps. The incentive is lack of downside risk. If you have
new money, and it's going into the market, small caps got hit
first and hardest. Alot of the good small caps fell unjustly
with the bad.
The only thing that bothers me, if lack of downside risk is
the driver for small caps rallying, is the 'internuts'. Until
all of the large caps feel risk, aren't people going to shuffle
between them? Until stocks like Amazon fall (using Amazon as an internut barometer), can small caps really rally? There is
tremendous capital in these internet stocks.
Don't think you are going to get all three wishes in a company:
"financially strong, dominant in an expanding market, and with great potential for top line growth" but if you do let us know.
Would suggest you look at PAIR, though, as it has low downside
risk (under stock buyback), trading near low. They are not clearly
dominant or exhibiting strong growth, but the potential for being in an expanding market is possible with new products. And, they are admittedly looking for an acquisition for growth going forward. Have had a small evaluation position since $7. One can also argue that their market consists of customers who are in a traditionally defensive sector: RBOC. Little downside, larger upside and easy
to park a little cash into at these levels (with a Stop).
Take a look, tell me what you think?
Other than PAIR, would have to agree with Tim Luke's XYLN pick.
Waldeen |
