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

To: gdichaz who wrote (40252)	3/11/2001 7:47:31 PM
From: lurqer	Read Replies (1) \| Respond to of 54805

So, now what? Your caution is prudent, but I am reminded of the virtues of moderation which might be useful in this kind of uncertainty. Another way to consider this might be hedging our bets. My comments have been directed at what may be the conditions for a secular bear beginning later this decade. With fingers crossed that my reasons are valid, I'm assuming the current bear is a bear correction. I'm discussing that future situation now, since the recent market 2X4 has gotten the attention of ltb&h types. Both you and tekboy have mentioned hedging - e.g. keeping only part one's capital in a ltb&h portfolio when the signs (e.g. rising interest rates) of an approaching bear appear. At first, I was disturbed that the approach seemed to do as much harm (limit performance around the frequent bear corrections) as it would provide protection (save some capital during the rare secular bear). Nothing is ever sure in the market; at best one deals with probabilities. Thanks to the prodding from both of you, I'm toying with the idea of a graduated hedge. The amount of the hedge would be a function of: 1) my assessment of the likelihood that the approaching bear is a grizzly (secular bear). 2) my assessment of the danger from even a black bear (bear correction). Just as mother with cubs is more dangerous, so is a bear correction after a particularly manic period. So I want to thank both you and tekboy for stimulating my neurons. But I for one have no intention of switching out of Qualcomm for CD's. Now, not an appealing prospect - in the '05 to '10 period, we'll see. Anyway, thanks again. lurqer