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

To: George Schulte who wrote (49323)	3/17/2001 10:56:25 PM
From: American Spirit	Respond to of 57584

I share your pain. I was WAY up a year ago and now have given it all back and more because I don't short. So I've had to cut back on travel, luxuries, etc., and get back to good old-fashioned hard work. Pity these questions only come up after a steep plummet. That's where the fear and loathing takes over. Other posters talk about not being emotional. Well selling into gloom is emotional. Buying isn't. Without a crystal ball, if I were you I'd gradually get rid of the margin on rally days and then sit tight on your best stocks. NOK certainly has a great future, though maybe not as bright as its recent past. Let's wait to see what Greenspan does and says. Also, I would advise holding companies with low PE's, real profits and mucho staying power. That's why I'm into VZ so heavily, as protection. I'm still in profits on it from November though I wish I had sold at 58. Now it's at 48. IBM is another I like down here around 20 PE. Stocks like this tend to be defensive but also will appreciate nicely when the economy gets better. VZ's low PE of 11 and dividend make it pretty damn safe. Corning is a favorite of Maverick and is a solid company so I'd hold that. I don't follow JDSU. Bottomline, if you don't need the cash anytime soon I'd ride this out but do reduce your margin and eventually get rid of it. It's costing you money, as you know. Who knows, but one thing I wouldn't do is sell during a peak pessimism period. PS - Have perspective. Historically speaking stocks do quite well over the long haul. A year ago at this time for instance while techs were booming ANF was at 9 and now it's at 35. So retailing was a black hole then and now the place to be. Why? has anything changed? Not really. Mainly just sentiment and over-reaction to a few pieces of lousy news. Ditto on oil and gas stocks. You name it. All the sectors go up and down over the years. So if you have a longterm horizon try and get out of your techs after they come back into style. Unlike the pessimists, I don't see a lot of downside from these prices and thnk it's a awful time to dump. But I thought that a month ago too so obviously I failed to detect the extent of the bottoming process. We could be there now or we could have one leg to go. Usually though the dire predictions never come true. Naz 1500? Nah. No way. But then again who knows? Markets are crazy sometimes. And companies do screw up too. Who would have ever believed LU the #1 held stock in the world would ever go from 70 to 9.88, single digits? It was at 22 a month ago. What has changed? Not much. Hardly anything really. See the madness?

To: George Schulte who wrote (49323)	3/18/2001 3:39:55 AM
From: rocklobster	Read Replies (1) \| Respond to of 57584

George, having lost about 75 grand in Dec, and Jan, I am about the last person to advise you on what to do. However, understanding this, here are some ideas. First of all Do everything possible to whittle away at that margin debt. One thing you can do is sell covered calls on your positions to possibly recupperate some losses. these stocks are volatile and have fairly good premiums on options. you could sell calls against your long positions on rallys, and buy the calls back cheaper on dips, or just let them expire worthless. use the call premiums to either buy puts, which would protect you from more downside and wouldnt cost anything, or use the call premiums to pay down your margin debt. Realizing of course that if the market turns sharply, your stock could be called away from you thus forcing you to liquidate.. Just a few thoughts.. there is a covered call thread on S.I. that covers this topic. and surely there are many far more experienced people there to get advice from.. But get off margin..stop the bleeding. I personally took my losses, started over with what was left, which wasnt much, and am now daytrading only. I have learned to short, and am up nearly 30% in February. But I will not hold any margin overnight..NONE.. and actually haven't been holding anything overnight.. You can be fairly certain that any significant rally will be sold and we wont go up in a straight line, so use the rallys to sell out of the money calls, if you must hold those positions. You won't miss out on a move up if the market does start moving up..there will be plenty of opportunity to get in and plenty of pullbacks. You may sleep much better knowing that you're not exposed to a jdsu move down to $10 or something. who thought RMBS would be 15. down from 40 in two days.. hope this helps a bit. rok

To: George Schulte who wrote (49323)	3/18/2001 12:03:00 PM
From: BANCHEE	Respond to of 57584

George If I read you right... You have 50,000 cash or savings 40,000 on margin... 95,000 in stocks including margin... If that was my account, I might do this,,,, C 500 shares hold ARBA sell all P/E too high loss to high..= $3,000 GLW 250 shares hold....Fiber will not die... HD hold people will always spend in bad times or good times at HD..... 500 JDSU sell all chart does not look good and you need to get off margin.....This will give you about $11,000 plus $3,000 from ARBA + $14,000 500 NOK sell even though this is the best of the three(ERICY,MOT,NOK)This will add $12,000 for $26,000 so far. 250 NTAP..sell also...P/E 66 to high...don't like chart. about $4,600 to add to $26,000 = $30,600 500 SEBL sell all. P/E 107 way to high. This will add about $12,500 to $30,600 = $43,100....give you $3,100 left over,, WMT 300 shares hold. My wife shops there and loves the place. No matter what you do get off the margin..... You have $50,000 in the bank and own your house...You can afford to hold some of those stocks...If Randy is right, the market will get worst......... Best to you, no matter what you do.. Banchee PS The thought here is that you are a long term investor.. Not a day trader or swing trader...

To: George Schulte who wrote (49323)	3/18/2001 7:49:40 PM
From: maverick61	Respond to of 57584

George - your first step needs to be to get off the margin. Its probably been mentioned here many times before - but playing with margin can be dangerous. I myself only use margin in my daytrading account - and only intraday. I never hold anything on margin overnight. So, if I were in your shoes, my first step would be toward's capital preservation - and less downside risk. To accomplish that, you'll have to sell some of those holdings and get into cash. And you will take a loss on them - which is hard for many people to accept. But living on margin is dangerous - and in a bear market like we have, even more dangerous. Banchee gave you some thoughts on what stocks he would hold and sell if it were his account. I would probably be similiar to him if it were my account. The one thing I may want to do, again if it was me, is maybe wait til Tues / Wed to sell. In essence I would be betting on a favorable response to what the Fed does. If we get a short term rally from a fed cut - I could sell into it to get off the margin. The risk is the market doesn't rally and continues to go down. I basically would have to weigh the risk reward. Unfortunately I can't give you specific advice on what you should do. That is solely up to you. But f I was in a similiar situation, what I described above is how I would likely handle my own account. Good luck

To: George Schulte who wrote (49323)	3/20/2001 12:01:07 AM
From: Silver_Bullet	Respond to of 57584

George, If you haven't sold yet I might take this approach at this point in time. Your situation reminds me of times during the day when I have bought a stock and it is trading down near my loss cut point but isn't quite there yet. I am sooo ready to just get out but am hanging on so that hopefully I won't have to take the loss. But, what I am really looking for is a decisive move one way or the other by the stock causing me to act and I think that is what you should be watching very closely for as well. You are at the point where just selling isn't going to help and will possibly hurt so we need to try and get back to rational thinking and say your only willing to give up say 5000 more so that you can get out with at least 50K . So that's our plan, to only let 5k more go, preserve at least that much capital and set physical stops accordingly...Mental stops probably won't work at this point.... (You decide what your comfortable leaving on the table it may not be 5K and only 2.5K. I just used 5K as an easy round number) JDSU stop would be @ 21-21.5 You can really set it at 22 but it is more likely to get stopped out if we see some whipsaw in the market. I believe that JDSU is at a bottom but if it hits the 21-22 area it could slice through like butter so a stop in this area is a must at this point. And i think a point room to make sure that you stay in is worth the added loss should it go wrong. ARBA -- maybe a 9.5 - 9.75 stop loss C --- looks like a 44 stop --- next support point is at 42.5 or so if 44 doesn't hold.. HD -- stop at 39.5 It is reaching the appex of a triangle and what ever way it goes will be explosive, but wait for the stock to tell you which way it is going to go...I know easier said than done.. NOK -- Moving on up now, hope you didn't sell.. Could be on it's way to 30 or so likely stop at 23.75, Friday's low. NTAP -- stop could be placed just under Fridays low here as well. The main thing now is to wait for a decisive move one way or the other and then act....And of course preserving the capital you have. A 5 - 10% cushion for stops hopefully will give you enough room that you aren't stopped out just before things turn up if they do. I think we may see a bit of a run here but that is just a gut feeling at this point, no TA to back it up. So we've just set up our downside risk to our plan. What do we do if everything turns up? Do we just hold on thinking that we won't retest this recent bottom or do we try and trade in an out of half or the whole positon when an individual stock looks like it's hit a short term peak... This part needs some further discussion. Even though the market may rebound it is possible to retest this level which puts you right back to square one so it would be nice to make some profit on the next move even if it's only 5K... This 5k would be a needed cushion from our 50K stop loss and get out point. Hope this helps. FT