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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: rjm2 who wrote (12855)	7/26/2001 4:09:04 AM
From: Gary105	Respond to of 78700

good observation! i look at insider buying along with the following (which is a leading economic indicator): businesscycle.com right now both are bearish. also from your chart there is a few month (roughly 2 - 7 mo) lag between bottom on insider buying vs bottom on market....therefore i think we may see significant buying opps with year end tax loss selling. the wild card is tax rebate - i read that lower rebate in the 70s was catalyst that boosted economy and market. my ideal buying situation is heavy insider buying on fallen angel when overall insider buying is bullish - this often occurs during big market downturn at the height of fear

To: rjm2 who wrote (12855)	7/26/2001 11:44:53 AM
From: TimbaBear	Respond to of 78700

rjm2 Regarding tax loss selling....some personal thoughts: I think it is too early to tell. If there is a significant rally between now and the end of the year, then some tax loss selling might occur, which might only represent the normal retrenchment after a strong run and that would present a buying opportunity. However, if the market trends sideways into the end of the year, I'm not sure there have been enough profits made elsewhere to necessitate tax loss selling. Additionally, there may be an overhang of tax loss carry-overs from last year that could be used to mediate some of the current years need. Of course, those who made large profits from shorting the market might be the big players that need to protect some of their gains by taking losses to offset....but would they be buying or selling for the tax loss? Insider selling might currently be being done to get the gain from low-priced option exercise prices protected by losses incurred in other investments. Timba

To: rjm2 who wrote (12855)	7/27/2001 4:40:46 PM
From: Bob Rudd	Respond to of 78700

Tax loss selling will exacerbate oversold conditions in some beaten up stocks. It will create bargains, but also psueudo-bargain traps that look cheap but will only get cheaper as their underlying businesses continue to deteriorate. Either type may experience a substantial bounce in Jan, but the latter will roll over and continue to swoon. Last years taxloss season was very fruitful, so I'd expect more competition for attractive positions. Many business models are broken and won't come back, so selectivity and analysis are critical.