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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: SouthFloridaGuy who wrote (12384)	1/1/2002 6:02:45 PM
From: TobagoJack	Respond to of 74559

Hi NYCB, sounds about right and <<My strategy will be one of high dividend income stocks and shorting highflying semiconductor/equipment stocks - IT's equivalent of the steel industry>> makes sense. With the bullish crowd still insane, seeing things they don't, it would be wise to establish trade via short leap puts on the former and long leap puts on the latter, else one would be tying up capital too early, or be really busy trading on the 30 options to frenzied music. Chugs, Jay

To: SouthFloridaGuy who wrote (12384)	1/1/2002 11:57:56 PM
From: energyplay	Read Replies (3) \| Respond to of 74559

Your strategy is similar to what I am moving towards . Re: High dividend stocks - Check the dividend coverage AND how much senior debt there is ahead of you if business declines. Ford had a good dividend..., now cut. You may want to consider REITS,REIT funds, & closed ends - Look at RTF (Cohen & Steers' REIT fund) PFD, PFO (two closed end funds) NLY (mortgage REIT, does have a low probablity risk of blowing up if the sky falls however, but high dividend) Marty Cohen, who runs the RTF, has his feet on the ground - pretty solid guy. Semiconductor shorts - consider Xilinx XLNX - look at price to sales... Best short in semiconductors are the companies who concerntrate on single markets, especially telecom markets. XLNX was 70% telecom. Companies like PMCS, AMCC, BRCM , the gate array people ATLR, XLNX. Some of these have lots of cash, but Negative growth and stock price is WAY too high...ALso, they tend to be heavily owned by tech mutual funds (like Janus, Fido Magellan, etc.) I see these guys falling like a slowly falling souffle...may not be the best place to use leap puts, since the time value amy erode as fast a the price drops. I would avoid shorting the multi product line companies, who sell to PC, cell phone, and industrial markets. This would be National NSM, Analog ADI, Texas Instruments TXN, Fairchild FCS ( they have lots of debt & Cash) Cypress CY. These guys can move assests to growing areas, and trim people in declining areas very easily. Since many of them make price sensitve commodity type products, any inflation push will help their pricing, and encourage their distributors to increase their inventory. After the stock prices of the single market players come down in 1-3 years, I expect some of the survivors will be bought by the multi-line companies. Mixed views on Agere (lots of debt) Neutral on the high priced analog guys , LLTC & MXIM - slow growth, high P/Es , but solid balance sheets. I think that some of the retailers who have lots of debt may be better shorts than Semi companies. Economically, I see a similar scenario, but my bet would be that inflation will ultimately prevail (except for computer memory) So I have some precious metals (NEM, Franco Nevada FN.TO, some silver miners) Great observation - >>>"Ingenuity is created with Investment, which comes from Savings (or Credit). Credit is tighter today for most companies than on 1/01. Since there are no savings, there can be no ingenuity."<<< Some of the software comapnies in silicon valley are (privately) very happy that the venture capitalists will not be throw $13 million at two guys in a garage to become their next competitors... sort of a game of last innovator established before the money window closes wins. However, there are still a LOT of people who cashed out with a big pile who will look at starting something again - some of these people have been through 1982-1983, which was pretty bad.