Jeff, Richard, Dennis: excellent posts. Question: why not buy puts?
Jeff and Dennis are, I suspect, better TA'ers on THQI than I am. And the TA case you make is plausible, esp when coupled with Dennis's perfectly valid add'l points re the general (irrational?) exuberance surrounding the stock of late.
Yet, like Richard, I am quite surprised that you sold your entire core position on the basis of this one sell indicator. Unless you've divested most of your THQI gradually over the past few months, you would be looking at a sizable tax hit. Puts seem like a good answer. I strongly suspect that if THQI hits free-fall for a period (certainly a possibilty with this issue,) puts will be priced quite dearly, and will return a handsome profit as folks with low cost-basis scramble to get them. This would provide downside protection while keeping the taxman away and the potential for upside (which, I know you believe, is only a matter of time) uninterrupted and intact.
Would very much welcome additional thoughts. I'll be doing some thinking about how to proceed myself tonight.
Regards,
Dave |
