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Strategies & Market Trends : The Amateur Traders Corner -- Ignore unavailable to you. Want to Upgrade?

To: Brad Davies who wrote (8083)	4/5/2001 8:49:53 PM
From: Tom Hua	Read Replies (2) \| Respond to of 19633

Brad, which ones are better shorts than CCMP? I'd love to hear them. I'm running low on ideas. <g> As for CCMP, first of all you may want to take a look at how things are going for the chip industry. Chip and chip equipment companies have come out and warned of significantly lower sales this year. Many have warned more than once, and sometimes just weeks apart between warnings from the same company. Last month the CFO of AMAT stated in no uncertain terms that we haven't seen the bottom of the current chip downturn cycle. He sees no recovery until 2002, and that assumes no recession which by itself is highly questionable. The Intel CEO said pretty much the same thing the day after. Chip sales are projected to tumble 20% this year, chip equipment 20-25%. Foundries are running at very low utilization rate. Since every component of the chip food chain is down, I do expect CCMP's detergent will be less in demand as well. So why is CCMP a good short? This post gives some of my thoughts. Message 15594104 However, anyone shorting CCMP should be aware of the low float and hence extreme volatility, just like today. One can easily be squeezed out of the short position if not well prepared. Regards, Tom