WRT using 90/10 with $3000 base capital:
Doesn't your method of using 90/10 rely on the fact that you can keep playing bets until one pays off? It seems like with $300, you have 1 bet a year. If your $300, 2-4 month option expires worthless, you've hit your maximum loss for a year, so have to wait until the next year. But then the stock could possibly die before you have the cash to reload. Plus, your strategy seems to rely on diversification to a certain extent too. Am I missing something?
With respect to PSFT, why do you believe that Y2K will hurt them next year? My impression was that ERP vendors have been helped significantly by Y2K in that it has forced customers to upgrade their old enterprise systems to the newer systems that SAP, Baan, PSFT, and Oracle sell. So then after Y2K would be bad for PSFT, but before Y2K would be good.
Am I wrong about this impression? Is it that you think the negative Y2K macroeconomic effects will have a bigger impact than PSFT's positive Y2K issues? Or am I confusing company performance with stock price? (as in "PSFT will have OK profits/revenue, and will outperform the rest of the techs by only plummeting 60%." (Hey, "Outperform" means "if your stock goes down 60% when the market goes down 65%, you should be happy!" :) ))
Richard |
