<<What I've seen, and what I believe right now is that there are special market rules for NET stocks and even the high tech stock heavyweights look at DELL...up over 110 pre-split).
While in reality a split means nothing, when market conditions are
favorable NET stocks just take off after announcing. Whether it's
justified is debateable, but we've both witnessed tons of examples that justify the argument of investing for splits...EBAY,YHOO,CMGI,DCLK,CMGI,and now ATHM....they've
all considerably jumped due to investors running up the prices after announcements.>>>
I concur with your comments here. The tech stocks are fueled
by a lot of hype and expectations. The actual fact of a declared
split is refreshing as it will actually split. A lot of whatever success I've had in the market have been provided by jumping on splits
or sensing when one is coming.
In prior years (BT) or before techs, it was best to sell on the day of the split or thereabouts. That seems to have changed as you noted.
The biggest difficulty I have is deciding when to sell.
Dell is no problem, just never sell it. Probably safe with msft
csco types also. But selling other web stock leaves one in a quandary.
Regardless, one way I handle it is too buy several calls
covering the split and then sell part so they provide an assured return for the work and risk of riding the split.
An example on qcom: (not a split but same idea applies)
3-18 Bought 2 QAQGR at $6, 1 ZLUAR(leap) at $19 TOTAL= $3100
3-26 Sold 1 QAQGR at $27 (for $2700)
So now I have $400 invested in one Call and one Leap which are worth $7838 at todays close and can hold those for further
appreciation which may (happily) occur or sell under less stressful circumstances.
Never bet against Greg(g)
Regards
Sig
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