Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: Sam Citron who wrote (46946)	5/18/2001 1:16:57 AM
From: Gottfried	Respond to of 70976

Sam, great post on value! G. [end]

To: Sam Citron who wrote (46946)	5/18/2001 1:20:11 AM
From: Charles Tutt	Respond to of 70976

You need only look at the experience of the Long Term Capital hedge fund to discover that Black-Scholes, for all its technical underpinnings, is not a panacea. It's the same way with "intrinsic value." JMHO. Charles Tutt (TM)

To: Sam Citron who wrote (46946)	5/18/2001 12:54:48 PM
From: kdavy	Read Replies (1) \| Respond to of 70976

Sam, Thanks for a nice write up. I fully agree with your analysis. Like many other things in life, the value is in the eye of beholder. And this value changes with economy and investor sentiment. I try to convince myself that I know when I see a good value but cannot explain it. This is how I pick a stock to be a good value. First, pick companies that are leader in their business, Follow relative strength i.e. if they are moving with the indices (indexes) Nasdaq, Sox or showing more relative strength. I follow about 50 stocks but closely track and trade only in 8 -10. I do not trade any high flyers. My experience has shown that each time I trade out of my 8-10 stocks, I end up losing money. (These stocks are like my girl friends in college some 25 years ago. I thing I knew them but I still got in trouble because of unexpected behavior. Therefore, I tend to correct my mistakes as soon as I realize them. Second, Make sure the companies have no or almost no debt., must show constant long term growth. Look at mxim, amat, lltc long term charts, you will know what I mean. During a downward spiral I just trade and do not write covered calls. Near the bottom or rising tide the covered calls work best for me. When you buy and when you sell is the key. Take advantage of market swings. Here is the diffcult part. It is mostly gut feeling. I know when I should buy but cannot expalain it. Of course to buy at the bottom you have to go against everyone which goes against "Don't catch the falling knives" For example, Mxim has consistently shown a growth rate of 25% or so. When its PE is close to its quarterly earning (25% of its annual earnings), I consider it a great buy. Last quarter the earning was $0.33. Therefore, anything close to 33+/- 10% , in my opinion is very good for holding and writing covered calls with each runup. Enough rambling. Kdavy