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Technology Stocks : THQ,Inc. (THQI) -- Ignore unavailable to you. Want to Upgrade?

To: Kory who wrote (13003)	2/5/2000 7:44:00 PM
From: Jeff Bond	Read Replies (1) \| Respond to of 14266

I understand all that, so I guess my basic question is this "if THQI is the same company today as it was 2 months ago, which I believe it is, then what's with the extreme price flucuation in that same period"? The fact remains that volatility is much greater than it was 20-30 years ago, simply plot a chart of any major index along with a reliable volatility indicator for proof of this fact. So, to the investor that bought into THQI about two months ago, or to the long that averaged up at that time, what do you tell them? The fundamentals looked as sound then as they do now, but for that person, they must begin their investing career 50% in the hole. If this is not justification for doing a little T/A before making an investment, I'm not sure what is. Like you, I believe in fundamentals as the basic driver of business, but I think it is quite fair to say that trading and volatility today make the concept of long-term holding much more risky, much harder to implement, and much more a function of rational investing balanced with T/A. I guess that is my point, and for any longs that entered their position 2 months ago, I bet it is fair to assume they may feel the same way. Anyways, I know what you're saying Kory, and in principle I totally agree, it just doesn't seem to be the principled game it used to be, which is jsut another way of stating my case. Regards, JB

To: Kory who wrote (13003)	2/5/2000 10:28:00 PM
From: JGreg	Respond to of 14266

Kory, To use your "grain future" analogy, THQ equals the farmer in producing and the consumers are the game buyers. Following your analogy, the "betters" here are the investors. No one who just buys games from THQ is investing in the company. Whether we like the game or not, we have to care who wins the betting game, because neither company profits nor satisfied customers are going to benefit us unless we have put our money down on the table and taken the risk that there would be more gain than loss. You and I have to risk our money in order to benefit. Now, if you are an employee of THQ or if you are an avid fan of THQ's product, then your argument is on target. But the system of investing today puts most of us in the stands watching the game being played out between producer and consumer and we are (and I mean this in a positive sense of investing) "betting" that things go well. I have to side with Jeff on this one. I have been in and out of THQ often over the last three years because I'm not a gamer nor an employee. I do understand what you are saying, though. Because all of the trading/betting can so often distort the reality of the business, I have thought that if I owned a company I'm not sure I would want it traded publicly. But, then, that distortion is what the Martha Stewarts are counting on. (I'm sure I wouldn't be principled enough to pass up a billion either.)

To: Kory who wrote (13003)	2/6/2000 3:37:00 PM
From: Apakhabar	Read Replies (2) \| Respond to of 14266

Kory, Your point about holding long-term is stronger the longer you've held. For investors who bought before 1996, the recent plunge may only have cost them 30%. Whereas somebody who bought last January may actually have lost money, and almost everybody who bought for the first time during the past six months is now underwater. The point is that holding long-term is still the very best way to make the biggest gains but you MUST get in early. Jeff's point is that with the extreme volatility the idea of "buying the company" well into its successful run (THQ is not growing 100% a year anymore) is much more risky than it used to be. At the same time, because of the volatility, the rewards for buying at a technical low (say, at or below the 200 dma) seem to be obviously superior compared to, say, a strategy of dollar-cost averaging. It always amuses me to hear all the bad press given to the strategy of "market timing." Every Nasdaq MM is a market-timer, and they all make piles of money. Truth is, market timing is not a bad strategy, it's just a bad strategy for inexperienced and/or uninformed investors. With all the information now disseminated over the Internet, there is no excuse for being uninformed, and while that doesn't mean we should all become market-timers, it does, IMO, make market-timing a far more reasonable approach to making money than it was five or ten years ago. One of the reasons a lot of THQ investors don't sell the tops is that they know the "big top" is yet to come: when this short position covers. That could come about naturally and slowly as the company executes or it could come about explosively if the company gets acquired. I own nothing but THQI shares in a long-term account that I don't trade for the single reason that it would bug me too much if I ever missed this "big top." But for a short-term (1-12 months) strategy, just draw a straight line from the lows during the past four years and you can see what a favorable time it is now to buy. That's TA at its most simple. (And perhaps most useful. "Things should be as simple as possible, but no simpler." --Einstein) The stock might decline a little more from here based on that four-year chart but by the end of the year I bet we see 50-60; I say that based on the fundamentals that will drive the price forward as you predict, and the TA for giving me a target.