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To: sea_biscuit who wrote (24048)	8/22/2001 10:42:06 PM
From: TimF	Read Replies (1) \| Respond to of 25814

Just read that CIEN has been added to S&P 500. So it looks like both Addi's and Jock's portfolios will see a pop in the short-term. But maybe not for any longer then that. JDSU wasn't exactly helped much by being added to the S&P500. One of the reasons why I don't like the S&P 500 is that the committee has added too much tech junk in recent years, and many of them at outrageous valuations. That will be a huge drag on the index going forward. In the coming years, I won't be surprised if more managed funds beat the S&P 500 than in the past few years. JDSU is a great example of this even if it isn't actually junk it was put in at a huge overvaluation. But how does the S&P figure its performance. It would be easy if it was a basket of stocks all bought at the same time but its not. Its a changing index weighted by market cap. If a stock decline then its market cap goes down and it counts for a lower % of the S&P. Do the performance figures for the S&P 500 adjust for this? To make it simple lets say it was the S&P 2. The two stocks have symbols A and B. Both stocks have the same number of outstanding shares. A goes from 10 to 20 in a month while B goes from 20 to 10. Does the S&P2 show a return of 0% of the month, or a loss (because B was 2/3's of the S&P2 at the beginning of the month) and it went down, or an increase (because A is 2/3s of the S&P2 at the end of the month and it went up)? Tim

To: sea_biscuit who wrote (24048)	8/23/2001 11:40:23 AM
From: uu	Read Replies (1) \| Respond to of 25814

It does not matter whether CIEN is added to S&P or for that matter even if god himself put a strong buy recommendations on stocks such as VTSS, CIEN, LSI, etc., in the immediate short term (1 day or 2) they may get a pop, BUT in essence they will not go up (if not in fact go down instead)! The situation is similar to early 2000 that even if god put a Sell recommendation on stocks (the likes of .coms, semis, etc.) they would not react and did in fact went higher! What we are going through now is the other end of the extreme, where stocks go down illogically more than they should really go down. Per CNNfn NYSE and Nasdaq short interests are at all time historic highs! If indeed there is a method to the Wall street madness (which I believe in the final analysis there is one!), portfolios such as mine and Jock's will see tripple digit (or higher) gains from their current levels within the next 2-4 years -- (of course this time I will not be too greedy and will take my gains after I double! ) :) 2-4 years may seem a long way for some, but in reality as we all know it, time goes by in a blink of an eye without you realizing it till it is passed! But anyway that is another topic and another story to talk about! :) Anyway -- AND keep in mind Dipy, it is the illogical factors of the market (i.e.. basic human being emotions, greed, and fear) that define the level of acceptance of logical factors (i.e. P/Es, P/Ss, perception of revenue growth rate, etc.)! At this time with alomst $3 trillion sitting on the side (per CNNfn), the problem is not liquidity (like it was in the 80's or early 90's), the problem is fear and lack of aggressive greed on the part of investors! But that -- like any other humna emotions - changes (as we all know it)!