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Strategies & Market Trends : The Art of Investing -- Ignore unavailable to you. Want to Upgrade?

To: Curbstone who wrote (6)	9/1/1998 8:57:00 AM
From: Just My Opinion	Read Replies (2) \| Respond to of 10655

convertbond.com well here is a new site, but I am having trouble accessing it, maybe it's being overflooded. Convertible bonds might be something someone might be interested in as an investment strategy..

To: Curbstone who wrote (6)	9/1/1998 9:41:00 PM
From: Waldeen	Read Replies (1) \| Respond to of 10655

Sun, Aloha, Sun, you investment strategy and mine are too similar, really liked your opening message for this forum. Similar to you, I believe that the big growth(somewhat? synopsis with internet to me) companies will fall dramatically within six months. Eventually, people will move towards value as growth slows. This is my sentiment, and my technical background is not as strong as yours, but comes from years of self-taught market knowledge. What has been frustrating for me, is in this 'correction' some of my value stocks have taken a beating more than my growth stocks. I have been a closet bear for months; but moving into value ahead of time didn't turn out to be defensive: as mark sentiment carried them down with the Dow components. In particular you would still have been better off in a Dow component with a P/E of 30, as opposed to a non-index stock with P/E of 8. Particularly if the value stock was a small-cap. This is why I believe the Big caps have not yet felt sufficient pain for the downside to be over. Okay, here is the question. 'If' I believe that in the short/intermediate term the Big Caps will rally again, but will eventually fall big, at which time value stocks will rise, what investment strategy would maximize returns if this were to pass? Clearly in the short term, the big caps seem most likely to increase in price. But if you hang onto them too long, you have moved into growth and not value. Small caps could be very volatile and trying for the long term investor in the short term, but may in fact offer more value. In line with Mike's obervation, then for the next 3-6 months, why aren't long term calls (leaps) invested in big cap stocks potentially profitable with built in downside risk reduction? In addition a core holding of value stocks for the long term plus cash/bonds/money markets of course. Traditionally people have claimed that stocks are more safe than options. But in a bear market, aren't leaps more conservative than stock purchases? I read all these experts who talk about mechanically cutting losses, aren't options the way to do this? (As opposed to most people placing stop limit orders.) In general I consider spreads for the professional investor who has time and ability to react. But buying leaps(calls and puts), or puts, stock and covered calls seem like better discipline up front then mechanically cutting losses with stop limit orders.