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Technology Stocks : Amazon.com, Inc. (AMZN)

AMZN 232.52

+0.1%

Dec 26 9:30 AM EST

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To: Glenn D. Rudolph who wrote (29759)	12/13/1998 2:29:00 PM
From: Rob S.	Read Replies (3) of 164684

This is anecdotal - the results of my unscientific survey of brokers and investment advisors uniformly shows that a large percentage of long-term holders of Amazon and other Internet stocks plan to sell 1/2 t0 2/3 of their holdings after the stock splits in January. One investment advisor I spoke with was typical: " . . . one client bought Amazon when it was around $40 and sold off 1/2 at $130. He now considers his holdings 'free money' and plans to sell off 1/2 of the remaining shares after January 4th. He also owns Yahoo! and some other Internet stocks that he plans to sell part of during the typically strong (for tech stocks) 1st quarter." Reports of strong Christmas season sales can be expected to help lift the Internet e-tailers but at what point will that have become fully factored into the market for these stocks? Massive insider selling, stocks splits, and a flurry of IPOs will ease the supply v. demand by this spring, IMO. I think we will see a pull back after seeing new highs in the sector. I don't think we will see a large run up like we had a few weeks ago - but the extent of shorting in these stocks could cause a swift jump up around expiration times. If the sector does rise sharply and another round of totally Bizarro world buying and short covering frenzy steps in, that will be a time to sell. IMO, sell short only when the sector and individual stocks reach wild and crazy extremes and cover on brief pull-backs. Buy only when you can get in on the IPO or shortly afterwards as a momentum play or when the sector sees a significant short-term correction. The problem with the above is that it is an attempt once again to use logic about these stocks - something that has proven to be less usefull than just joining the masses who have swarmed into the market picking up practically anything with .com at the end of their name.

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