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Strategies & Market Trends : Fatty's Donut Shop -- Ignore unavailable to you. Want to Upgrade?

To: Lynn Goodman who wrote (2173)	7/8/1999 10:20:00 PM
From: gladman	Read Replies (2) \| Respond to of 5041

Lynn, You raise an excellent point and it's not a novice question, many traders with more years than you don't fully understand the earnings phenom, i'm no expert either but to answer your question - I do see risk in holding thru earnings, there inevitably will be a dip the day of or day after they report depending if its announced before/during/after market hours... why? Because there are hundreds and even thousands of traders(like you and I) who are making the same play, it's almost becoming a self-fullfilling prophecy, but that's okay as long as you UNDERSTAND THE PLAY. Look at the charts for: GE,YHOO,COMS,ADBE,INTU,CMVT,PAYX, notice the earnings runnup 2 weeks prior then the post announcement selloff. I hate to say it but it's typically smart money selling into dumb money, the SM buys in anticipation, rides the wave prior to earnings then sells into the announcement... who's buying? DM reading the paper, business week, hearing it on CNN and deciding "hey, earnings are great, must be a good buy, lets jump in". Long term they're not bad investment decisions, but short term you must go with the trend. Having said all that, let me contradict myself slightly with ELNK b/c (as you astutely mentioned) there is an added twist of a buyout via either GTW or FON(an equity owner in ELNK) and if this is announced before earnings then all bets are off and the price will rise to its takeout and stay there thru earnings. If the buyout isn't announced then I would expect the upward movement to continue then dip after earnings. It's simply short term traders moving on to the next opportunity. Lets talk next Mon-Tues and see where we are, long term ELNK is a great buy and hold, just not my cup of tea right now. Take care, Dave PS - 2 related plays are (1)shorting after earnings (2)going long after the big selloff. Lets discuss next month after the craziness has died down.

To: Lynn Goodman who wrote (2173)	7/8/1999 10:38:00 PM
From: Matt Brown	Respond to of 5041

Quick note on ISLD - I posted why I thought it fell a little today on the ISLD thread. I plan to make a "snapshot profile" of ISLD for the webpage so we all have a good reference to key links and data. But, for now, here is a very good link showing who is in deep with ISLD - newsalert.com Excerpt- ." Beneficial Beneficial Ownership of Ownership of Shares Before the Shares After the Offering Offering Name of Beneficial Owner Number Percent Number Percent Crosspoint Venture Partners(1)............ 3,246,679 11.6% 3,246,679 9.6% Chase Venture Capital Associates, L.P.(2).................................. 2,823,529 10.1% 2,823,529 8.3% Vanguard V, L.P(3)........................ 2,561,310 9.2% 2,561,310 7.5% Crescendo Venture Management, LLC(4)...... 2,109,212 7.5% 2,109,212 6.2% *ETRADE Group, Inc.(5).................... 2,013,367 7.2% 2,013,367 5.9% Tudor Global Trading, Inc.(6)............. 1,966,724 7.0% 1,966,724 5.8% FW Ventures III, LP(7).................... 1,882,353 6.7% 1,882,353 5.5% Merrill Lynch KECALP*(8)................... 1,482,824 5.3% 1,482,824 4.4% Ron Higgins(9)............................ 2,075,000 7.4% 2,075,000 6.1% Ruann F. Ernst(10)........................ 604,574 2.1% 604,574 1.8% T. L. Thompson............................ -- -- -- -- Paul Evenson.............................. -- -- -- -- Allan Leinwand(11)........................ 161,725 161,725 * Rick Schultz.............................. -- -- -- -- Michael T. Sullivan(12)................... 83,000 * 83,000 * Tim Wilson(13)............................ 133,366 * 133,366 * Charlie Bass(14).......................... 419,283 1.5% 419,283 1.2 Marcelo A. Gumucio(15).................... 212,000 * 212,000 * Christos Cotsakos(16)..................... 36,644 * 36,644 * Cliff Higgerson(17)....................... -- -- -- -- Shahan Soghikian(18)...................... -- -- -- -- David Spreng(19).......................... -- -- -- -- All directors and executive officers as a group (14 people)(20).................... 3,725,592 12.8% 3,725,592 10.6% (End of item excerpt.) Also, if you get time, read this Post regarding the management team... They have some big boys from Cisco that jumped on the Island - Message 10433910 Adios amigos, FM