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Strategies & Market Trends : Options for Newbies -(Help Me Obi-Wan-Kenobe) -- Ignore unavailable to you. Want to Upgrade?

To: Dan Duchardt who wrote (2155)	8/27/2001 6:47:24 PM
From: Joe Waynick	Read Replies (1) \| Respond to of 2241

Dan, I can't argue with your logic. However, I don't want to spend my days reading charts trying to pick a bottom, or even trying to determine if the current surge in price indicates that "this stock probably will not go lower from here." I don't have the temperament for it. If my fundamental analysis tells me a company is worth "x" dollars per share, and that I'll see a 15% annual return over 10 years if I buy below that price, I really don't care if it goes a few points lower than my entry point. I will have hedge shares in my portfolio that I'll continually write calls against at strikes above my cost basis. If I stick to well-known, financially stable companies I'll eventually get exercised and my core position will be well below the intrinsic value of the company after accounting for the option premiums and stock appreciation of the hedge shares above my cost basis. Factor in dividens and my cushion gets even larger. All I need to know is "Are the assets continuing to generate a business-like return, regardless of the price of the stock?" If yes, then I leave it alone and continue to write calls. I can then spend my time in pursuits that are much more enjoyable or searching for another hidden gem. There's nothing wrong with your approach. We each have to implement a strategy that suits our own individual temperaments. If you're comfortable investing that way, I wish you the best of luck. I don't believe in a "best" way to invest because the "best" way is the way that achieves the goals you've set for yourself. Joe