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Technology Stocks : Amazon.com, Inc. (AMZN) -- Ignore unavailable to you. Want to Upgrade?

To: Walter High who wrote (3208)	4/21/1998 1:33:00 PM
From: Winter	Read Replies (1) \| Respond to of 164684

Walter, >>Riding KTEL from 40 to 80 while waiting for the inevitable fall can prove disastrous<< I agree with what you said but like I said before, if you enter the short position with the cash and the intestinal fortitude to stand the stock rising substantially then 40-80 is managable. If you're going to get a margin call at 42 then you had no business being short in the first place. >>My point is that there are better things you can do with your money that take the risks associated with shorting, even using protective puts. After all, the best you can do with a short is double your money, right? If it takes a year or more, you might have done a lot better than that betting on good growth stocks.<< I think you can make most of the same arguments against going long: may take a year, its risky, etc. It all comes down to good stock picking. Me, I'd settle for doubling my money every year :-) I like keeping my portfolio balanced with longs and shorts, seems safer than long only in case of a serious correction. To each his own. FYI: I am neither long nor short KTEL.

To: Walter High who wrote (3208)	4/21/1998 1:56:00 PM
From: Satellite Mike	Read Replies (2) \| Respond to of 164684

>After all, the best you can do with a short sale is double your money. Walter, were you "high" when you made this calculation? Mike

To: Walter High who wrote (3208)	4/21/1998 2:33:00 PM
From: zebraspot	Read Replies (2) \| Respond to of 164684

Two points on hedging and shorting: Why would anybody short AMZN when puts are available? Pay the premium and avoid the "infinite" downside and mark-to-market problems inherent in shorting. Buy the OCT's to avoid the timing problem. I like the OCT 80's(at current price around $10). $10,000 will become $50,000 if AMZN gets to $30. Your risk is limited to losing the $10,000. I think there is a pretty good likelihood that even if AMZN doesn't fall to $30, say, it will fall to at least $70. At $70 you are breakeven. Don't forget that if you're long the stock and buy puts to hedge, you've probably committed a "constructive sale" under the new tax rules(thank Clinton for this). You probably owe taxes on your long position even though you didn't sell. Hedging with puts ain't what it used to be. there are limited ways out of this, but none that will let you remain hedged in the long. For instance, if you are now hedged with puts you need to sell that position between now and next 1/31; once you sell the puts you have to sit unhedged in the long for at least 60 days.