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Technology Stocks : Qualcomm Incorporated (QCOM) -- Ignore unavailable to you. Want to Upgrade?

To: brian h who wrote (8157)	2/7/1998 7:53:00 PM
From: dougjn	Respond to of 152472

Thank you. I think. :) I think for the last number of years buying and holding good companies despite downdrafts has generally been a good idea. Since October 97 medium term trading, accepting that one will never hit the top or the bottom but only some part of the move, has been best. That has been the empirical fact; I think it was foreseable after the October slide got going; I think it will foreseably continue to be best for some time; probably until we have a real bad more than 15% S&P slide. Why would take too long here. Many if not most pundits of course agree with this now. Or are more negative. So the point is to match the macro with actual action in the real world. One solution is to take all ones chips off the table everywhere for a while. Another is to get in once bad news seems just about fully discounted and ride the broad waves up, but not to overstay your welcome. Another is to just ignore it all and hold. Not holding during downdrafts has for the last six months or so been an especially good idea since in every downdraft there has been a tendency for some stocks to get REALLY killed. And for high beta tech stocks in general to get pushed down hard. Of course one has to get back in when things are low. Hitting the bottom is impossible, except by luck. I think we will have a trading market at least through the first half of 98. Am I certain? Not absolutely, but fairly. Heck, investing is a business of playing the odds. No one is right all the time. For one thing there is an important element of chance at play in every single dicision. I suspect it will be a good idea to exit the market generally not long after the end of the Olympics. Iraq, Clinton, 2nd quarter warnings season focusing us on Asia again. S&P fully played up. I am not sure how far Q will go down. I am all but sure that it will not embark on a solid upward move from Fridays close, never to go lower again. And I think there is a way more than even chance that Q will go into lower 40s, and a significant chance into the 30s. On those odds I sold the 1/3 I had bought back at 50 several weeks ago, at 49 the morning after the very bad news on Friday. I'm not a day trader or a week trader. I do try to avoid ridding a big move all the way down if I'm pretty sure its gonna continue. Call me irreligious. As well as fallable. Doug

To: brian h who wrote (8157)	2/7/1998 8:54:00 PM
From: Matt Webster	Read Replies (1) \| Respond to of 152472

Pricing in Surprises... The author below makes the questionable and interesting claim that the analysis does not contain the possibility of a surprise license by ERICY or other events that could increase the price dramatically. The counteragument to that argument is obvious. The probability of that happening arguably has not changed since yesterday's announcement about South Korea. If one believes in anything like efficient markets, one would have to believe that the prior price included the possibility of those "surprise" events. For the author to make his argument, he has to mean that the lower stock price and increased SEA fears increase the probability of the other events. Now, THAT is an interesting argument. I personally can see the logic to it if this makes QCOM willing to lower the price of a license to ERICY. If that is the case, the license deal is more likely. However, on the other hand, the lower than expected price reduces the value to future earnings, and that, too, has to be discounted. Theoretically, this is a question of the correlation of shocks. Step one, is the shock of SEA going into the tank positively or negatively correlated with ERICY's signing a deal? Step two, is the correlation economically meaningful. The answers to those are completely up in the air. I personally would like to hear commentary on that from all concerned. Matt