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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: gdichaz who wrote (27582)	7/10/2000 1:04:09 PM
From: tinkershaw	Read Replies (3) \| Respond to of 54805

Thanks guys for the kind words. Does Moore's new book come in eBook? In regard to gidchaz’s question But am curious the extent to which you dig into the technologies themselves prior to or simultaneously to looking for a buy and hold candidate. What I do is follow a universe of tech stocks. Probably 50 or so and it keeps growing. And somehow or other I seem to gain a working understanding of these companies competitive position and technology and somehow keep them all straight in my head. As I scour for these companies I pick up the technologies as I go. It is when the stock gets hammered for non-fundamental reasons that it truly pops my interest and I check out the detailed tech. And it is often a painful process as I almost always have to sell something else off to pick up these compelling opportunity stocks. And I have become very picky. For example BVSN crashed on Friday big time. Definitely a market leader. But I decided not to jump in due to what appears to be low switching costs. So without getting into a very detailed technical analysis I opted not to go with BVSN because I don’t want it for the long-term. It would be a speculative trading issue. And I have seldom come out ahead in such matters. It was not a better place to put my money. But when AMCC crashed into the 80s this was different. I was extremely satisfied with the business momentum, contract wins, sustainable advantage, and the roaring hyper-winds in its markets. Having Nortel, Lucent and CSCO as customers is fine, but you add Sycamore, Juniper and Corvis and you have gail force winds for as far as the eye can see! So I felt safe, and COMPELLED (this compulsion is important) to make a large pounce at this level (I don’t believe in taking a small position in anything I own – which is why I like owning 5 stocks and no more than 6). It was after buying it based on this mid-level knowledge of the company that I moved in quickly to learn as much about the technology as I could. And then began the weighing process of whether or not it would join my don't worry about it core holdings. As of now it still sits there at the edge of my portfolio being weighed. It joins BRCM (which is on the verge of joining my core never sell holdings – finally (if for no other reason I can’t afford to pay the capital gains taxes if it didn’t). It also joins RNWK which I am still evaluating and will be doing another column on today. AS FOR FURTHER AMCC INFORMATION: The only danger to AMCC that I see on the horizon is Vitesse. Vitesse has gone on an acquisition spree to acquire silicon solution companies for the core. They seem to have realized the disruptive nature of AMCC’s product. I haven’t examined Vitesse’s purchases in detail, but Vitesse may gain a greater share of this market in the future. Again though, given the truly gail force winds in this market there is plenty of room for two. And at this time Vitesse is losing the game (in a relative sense to AMCC). So my answer to your query is I pick up a large amount of working knowledge on a heck of a lot of stocks. But I don’t get into minute detail until a compelling opportunity rears its head. If I then decide to buy it I weigh the stock overtime and hold it until (1) it becomes part of my core or (2) there is no place better to put my money based on long-term portfolio goals. Have been pondering adding Q again (this time to the core). It is reaching compelling levels. In fact I've been tempted to go 40% Q at these levels but have been unable to sell off the other stuff I own at this time to execute this. The only thing at a short-term sell at the moment is BRCM and I don't want to sell it. That leaves AMCC and RNWK. Of these RNWK is closest to the chopping block but I haven't finished fully weighing it. That is what my RNWK column today will be about. Tinker