Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: Jacob Snyder who wrote (20811)	6/25/1998 4:54:00 PM
From: Ian@SI	Respond to of 70976

Jacob, As a Dr, I trust that you understand that the medical profession is one in which the best are continually learning. For one who lists his age as 39 and less than 3 years investing experience, you will also accept that there's much to be learned about investing and that there may also be new things to learn as the "world" changes. 3 Points: 1. Stock prices tend to be forward looking indicators. 2. PSRs are backward looking indicators. 3. "The Street" will always, or nearly always, have better forward looking information than an amateur who is not an insider for the particular Company or at least the Industry sector. If AMAT goes to 60 this year or next or any year, it's extremely unlikely I'd short it. There are some risks that just aren't worth the potential reward. ...and AMAT is in that category, IMO. FWIW, Ian.

To: Jacob Snyder who wrote (20811)	6/25/1998 5:21:00 PM
From: Gottfried	Read Replies (2) \| Respond to of 70976

Jacob, PSR was >4.6 last summer. Link to chart...GM geocities.com

To: Jacob Snyder who wrote (20811)	6/25/1998 8:08:00 PM
From: Math Junkie	Respond to of 70976

Re: "If AMAT is at 60 later this year, and nothing else changes..." You just changed the conditions of the scenario. I was commenting on the scenario as originally stated, without the "and nothing else changes". "I think you can predictably make money shorting AMAT at a P/S of 4.6." Maybe so, but if you put everything you have into it, you are betting that the PSR will never set a new all time high. Perhaps you ought to reflect on the fact that, until recently, the S&P500 had never traded at a p/e of 24. "That is just as safe a bet as going long at a P/S of 1.5." This is absolutely not true. When you are long, your potential losses are limited to what you paid for the stock. With a naked short, your potential losses are unlimited. I'm not saying no one should ever sell short. It's just that throwing everything you have into it is just way too scary.