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Strategies & Market Trends : The Round Table: A work by the squares of the SNDK thread.

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To: phoenix who wrote (74)	4/26/1999 8:28:00 AM
From: Ausdauer	of 194

Roger, I read a brief article on cyclicals a few weeks ago. The ideal time for buying these stocks is after there is overproduction and a fall in the price of a particular commodity (steel in this instance) that makes it cheaper to leave the raw materials (ore) in the ground. Then, as demand rises and price appreciates (relative shortages) these companies ramp up production and rake in the cash. The stock price tends to peak somewhere midway into the ensuing growth cycle, at which point you are supposed to bail. Overproduction and a fall in cost usually follows. The cycle starts over again. Right now there is demand for steel, yet falling prices. Part of the world is in economic distress, while others are flourishing. I really don't know how to play the steel or cyclicals in general, so I plan to pass on NS. Ausdauer

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