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Technology Stocks : Global Crossing - GX (formerly GBLX) -- Ignore unavailable to you. Want to Upgrade?

To: RockyBalboa who wrote (11962)	6/18/2001 8:53:36 PM
From: Sir Francis Drake	Read Replies (2) \| Respond to of 15615

I hear you Info, but I'm not worried by GX. First, I split my GX into "invest" and "trade". Only today, with a substantial position at $7.53 did I establish an "investment" position, on which my time horizon is a minimum of 5 years (unless they get bought out or fundamentals change). I also have trading positions (my latest one was also established today, when $7.5 broke later in the day). As far as the trading position, I'm not worried, because my time horizon is very short, and I'm very opportunistic here. I'll trade for a bounce, and I'm not going for moon-shots. My TA indicated an imminent bounce, and the immediate potential downside no more than about $1.5 (to $6). However, odds are, IMHO, that we've seen at least a short term bottom, and there'll be a small bounce from oversold conditions here. So, I expect to make money on the shares bought at $7.46-$7.49 very soon indeed. As to the investment part... what can I say. At $7.53 I really don't see all that much danger that with a time horizon of 5 years, I'll lose on this purchase. If I can't make money on GX in 5 years, buying at $7.5 - well, then I should quit the market right now, because my DD skills are obviously worthless. I realize that there could be more downside to GX as the economy tanks, as the sector is faced with chpt 7 filings, should GX fail to move to servicing the MNCs and fail to capture other higher valued added revenue sources (my biggest potential concerns about GX). I also realize that as institutional money flees now out of an unpopular sector, and as the movement is accelerated by redemptions from MF's, it creates a market dynamic of demand/supply imbalances which have nothing to do with GX's intrinsic value as a business. But I guess my response would be to add on any such movements down from the $7.5 level, however far it goes. I sure am happy I have not been "investing" in GX above $10 (or indeed $20, $30, etc.!) - that leaves me with plenty of funds to average down from $7.5 should I have to, rather than having shot my wad too early... I thank the insiders for that, the pattern of their selling was a RED ALERT WITH RINGING BELLS for me. But at these prices... I only WELCOME averaging down. The biggest danger to my "investment" position, is that GX will head lower and STAY lower for a very long time. Admittedly that is a pretty substantial danger. I see no real catalysts for the price to go up, sustainably (i.e. more than just for a technical trading bounce), anytime soon. In addition to all the institutional money that is fleeing and that WILL flee (on account of their "under $10" status for one!), you will most likely see a rotten market for a very long time - not an ideal environment for GX to rise in price. Then we'll have the end of year "mother of all tax write offs", which should take this puppy down substantially (and lets not forget how MFs will be dumping by the end of October to qualify for their tax write downs). It'll be ugly, ugly, ugly. Then the economy will most likely continue to tank well into next year (as I see it), and GX stock price could be in sad shape indeed. So, how can I cheerfully hold here at the outrageously "rich" price of $7.53<ggg>? Simple - I have a 5 year horizon (barring drastically changed fundamentals). It is my belief, that GX will be higher within that time frame than it is today, never mind how low it may sink in the interim. Of course, that may still turn out to be a poor, underperforming investment, but those are the chances I'm willing to take. And I'll repeat again: I'm much happier to invest here at $7.53, than back in January at $25, or last year at $33 or whatever. I traded this beast often enough. I think at these prices, it also becomes a good investment... which doesn't meant that I wouldn't welcome another "buying opportunity" lower still... wasn't it Buffet who said: "if you are a regular consumer of beef, shouldn't you be glad that the price of beef is low or falling?". Well, GX is the beef here, or at least I hope they have the beef :) Morgan