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Strategies & Market Trends : Rande Is . . . HOME -- Ignore unavailable to you. Want to Upgrade?

To: active22 who wrote (34284)	9/9/2000 2:01:07 PM
From: American Spirit	Read Replies (3) \| Respond to of 57584

I'm not insane. I pick my buys and take my risks. On the rallies I sell off and eliminate my margin. I wasn't even on margin at all nine days ago. I bought into the downdraft value stocks only which I follow closely. So far the bottoms have held and some have even gone up. At these prices for telco stocks I figure 5% downside risk (which I can afford) but 50% upside potential 1-3 months out. Why shouldn't WCOM go back to 45 for instance? You saw it hit bottom at 29 1/2 just like T did at its low. LU doesn't seem to be able to go under 40. UIS and NOVL are on the rise. I bought IFMX, LOR and CPWR back nicely below where I sold them ten days ago. I added more NOVL. FON I got into starting at 31 1/2 down to 29 1/2, so average $30. Hey techjnically I am at risk but I am confident that these stocks have nowhere to go but up, at least by Tuesday or so. On A WCOM for instance I just don't see the downside. Afterall it recently plummeted from 47 or so to 30. And where's the bad news? There isn't any.

To: active22 who wrote (34284)	9/9/2000 2:11:19 PM
From: American Spirit	Respond to of 57584

The real risk it would appear to me is if I were to be using margin to buy those stocks with extremely high PE's and few earnings to show for themselves as yet. By buying a UIS at PE 8 or a VZ at PE 11 I think the downside is pretty minimal, especially when they are companies which could unlock a lot of value if they so chose. Expect NOVL for instance to spin off its hottest division which is valued 10x less than competing same-sector businesses. LU will also spin-off its chip business and unlock value. When stock buy-backs are in place you're somewhat protected. Know how much my portfolio went down since the Friday beofre last? $4,000. Which is only 2.5%. And I had just made 15% profit (and locked in half of it by selling) the week or so before. Meanwhile I was able to load up cheaply near the bottoms (knock on wood) and am prepared to make 10% or more when the next recovery rally plays itself out. And into that rally you bet I'll be selling. I suppose if I shorted I wouldn't have to do this but I use my margin as a defence against downdrafts. I double up on already cheap quality stocks getting cheaper. That's my investment style. Win lose or draw. It's not likely to change. I only bottom-feed real tech value and not much else. And to be right now the real value is in the telco and software stocks which have recently dropped 50-75%.