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Technology Stocks : S3 (A LONGER TERM PERSPECTIVE) -- Ignore unavailable to you. Want to Upgrade?

To: TimKP who wrote (11691)	8/5/1998 3:04:00 PM
From: Sleeperz	Respond to of 14577

Is the Texture Compression Technology that Microsoft licensed worth anything? cl >> Why, besides insanity (I must be insane) would anyone hold it?<<<

To: TimKP who wrote (11691)	8/5/1998 3:37:00 PM
From: Don Earl	Read Replies (1) \| Respond to of 14577

Hi Tim, I highly recommend that anyone investing in the stock market do their own research: SEC filings, fundamentals, competition, market, charts, products, news, conference calls, etc. If you've been reading 2 years worth of posts, you probably have a pretty fair idea of the basics. My average cost is $6.30 so my perspective is likely to be much different than those that bought at higher levels. The question I always ask myself when a trade goes against me is; "Is it probable that this price will be unreachable in the next 6 months?". That SIII is trading below 6 strikes me as absurd. Of course anything can and does happen in the stock market, but I feel that the odds are in my favor. Do I think it will go into the 20s in the next 6 months? May as well buy a lottery ticket, the odds should be about the same. I'd give it a 50/50 chance of going into the 9s, 80/20 for the 8s, 99/1 for the 6s. The only thing that really bugs me right now is that I can't leverage my position for an occasional day trade on margin. The company has enough cash where they could absorb heavy losses for years before they would be in any danger of going out of business. They have tightened expenses to the point where a minor change in fortune should make them very profitable. Savage is just the first generation of a new high performance product line for S3. Savage should make them profitable again, and future generations of the product should push them over the top. The competition is tough but there isn't any doubt in my mind that S3 is a major player in the industry. S3 has assets to justify a $9 stock price on fundamentals alone. At $9 it would still be a value play compared to 95% of the rest of the techs. I do think it will take a few good quarters to get it trading above that on a regular basis after the beating it has taken. There are different opinions about cost averaging. It's something I use to keep my investment current on longer term plays. I'll tend to keep a core position and trade around it. Occasionally selling off cheeper shares which gives me a higher average cost on fewer shares, then buying back if the price drops, bringing the average back down and generating cash. For example if a person had 2 shares at $12, buying 1 share at $4 would bring the average price to $9.33. Selling 1 share at $6 would bring the average cost to $11 on the 2 remaining shares, and so forth... It also seems to be better for my moral to have some shares that are in the black. Trying to pick a bottom can be like trying to catch a falling knife, so cost averaging can be tricky. It tends to work best on companies that have lots of cash and small losses, where time won't end up being your enemy. Generally, if I'm going to exit a position as the result of unexpected bad news or drastically changed conditions, I'll wait for a good dead cat bounce to minimize losses. Regards, Don PS: This is not intended as investment advise. Every traders has different goals and time frames. No systems works all the time or works the same for everyone. My views are included for entertainment purposes only.