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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: novice investor who wrote (37122)	11/20/1998 9:52:00 PM
From: Knighty Tin	Respond to of 132070

NI, 1. The January Effect is supposedly caused by tax selling in December. The theory goes that that depresses the price and makes stocks cheap in January. The reason the date is changing is people wanting to be there when the herd jumps in, so the smart money moves early and the herd is moving earlier, though the moo cows don't know why. <G> Also, option and futures strategies are greatly diminishing the power of the Jan effect no matter when it happens. 2. Not surprisingly, the great unwashed at the beach impact is pretty mute in Europe. Especially in these days of cell phones from the investment side and plants in other countries from the mfg. side. For example, you don't even notice it with BMW production, as the South Carolina plant runs full tilt during August. It is nothing like Golden Week in Japan. 3. The most seasonal industry I know is personal computers and pc related components. I try to get in very heavy positions on puts early in the year, cut to a minimum (in this bubble market. In a fairly valued market, I would buy shares or callse) before Golden Week, build it back up in May, and get light again before the end of August. If you look at the XCL or SOX charts on the CBOE big charts site, you can see that this brain dead system has been right on for years. In no way do I let the seasonals impact on my fundamental thinking on the companies, but it does impact on when I want to place my bets. The Intel brouhaha is a good example. Intel is at its seasonal peak. A lot of folks don't realize that, especially Intel lovers as they rarely realize anything. But the downturn during last year's 4th quarter was an anomaly. If I am right, the stock should be in deep kimshee by late winter. Oil is another good one. Summer driving and heating oil season in the winter are usually good periods. The spring and the fall tend to suck. So, I am buying my Schlumberger now, not in early Oct. MB