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Strategies & Market Trends : Waiting for the big Kahuna -- Ignore unavailable to you. Want to Upgrade?

To: Monty Lenard who wrote (24880)	8/22/1998 9:30:00 AM
From: James F. Hopkins	Read Replies (1) \| Respond to of 94695

Monty ; The magic ten is high up on the hog for parking some money when the market is in turmoil, it's easier to get big block trades without shooting yourself in the foot. It has the advantage of being the "must buy stocks" any time the index goes up, as index funds tracking the index have to buy these simply because of their weighting. As long as the market is 1st; primarily a momentum (MO MO ) market , and 2nd a value market this will continue. The nature of the S&P 500 Index forces this MO MO on the market to the point it over rides the rhetoric about value & earnings. While 10% corrections help to correct this MO MO insanity they don't cure it, even after the correction it remains the dominate factor , it will take one big huge correction to ever change something this powerful that's so intrinsic to the market. The more market cap an issue has, the more of it the index funds must buy. Only a true bear market that last over time will upset that , and even then when the bear part ends, the stocks with the largest market caps will once again pick up the edge MO MO buying gives, all thanks to the way the S&P is weighted, and the funds trying to track it. This is what the strategist sees as fact, and what the analcyst lives in denial about. Send this to CNBC and let them get some talking heads to argue with it I'm not saying you can't find stocks that return more, particularly if you use Monday mournig quater backing. But you give me several million dollars to play with, and let me buy and sell these 10 stocks "as a basket" and doing market timing I will MO MO walk all over the S&P500. Liquid and MO MO will beat FA and value all to hell, it's just the way things are, so why fight it. <G> Jim