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OT - tax
strategies
OT - (Also in light of lt cap's frequent reporting of, for
instance, NOK partnerships that should bear fruit down the line) -
I've been puzzling for some time this issue, which I think just
doesn't have a good answer: My biggest positions (and they are big,
by my standards) are NOK, INFN, CIEN. They've been so beaten down
from where I bought them, I have very substantial paper losses. The
depth of the INFN plunge was forseen by nobody. The thing is:
If I sell part of those positions, I'll have a capital loss that
will be substantial, and will cover a multitude of 'sins', should
the rest of the portfolio end up with capital gains.
On the surface, being out of a given stock in this sector for 30
days would of course yield that capital loss, and I could buy in
again if I wanted to. And it seems to me that the odds would be
with me: e.g., Given the extremely slack demand that we're seeing
in wireless stuff like ERIC, the chances that we're going to see
sudden large upward moves seems small. All of those stocks seem
vulnerable to further bad news (Perhaps CIEN the least, although
they are once again most day-by-days in smaller numbers
retreat.)
So, this might be the best time to try to get a capital loss on
the books - good news in CC's seems slim, given that working
through this slow demand likely will take time. And, when
companies like NOK announce partnerships or wins in future
build-outs, it doesn't seem to move the needle - suggesting perhaps
that the street wants to see bottom-line results from such
partnerships or business, rather than just an agreement.
Except......suppose a company like NOK surprises, even in
that the quarter was not so great, but measurably better than ERIC,
and beating analysts' low expectations? Or, suppose INFN has been
horsewhipped way beyond the trouble they're in, and rises to what
might be considered fair value (of which no one knows - I recall
one analyst saying that one ought to hold it through this 'trip to
the sewers' as long-term he thinks they'll be intact
again.)
But I digress. It seem to me that if one is going to try and
take some capital losses, the present slump may be the best time,
odds-wise, to get out and get back in without 'seller's regret'.
But the whole sector is so volatile, and unpredictable, and that
seems such a basic characteristic, that trying to time this sort of
thing, it's like playing roulette - red and black in reality have
equal chances. Unless you're playing 'Russian roulette', in which
case you might want to put a bullet in your brain if INFN doubles
in the meantime :-)
I'd be intersted in anyone else's take on the risk of the
capital loss vs. can't time the sector issue.
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Jamok,
I think you might be correct regarding the odds of a surge in
either INFN or NOK within the next several weeks, more so with them
being so hated and end of year tax loss selling. Expectations
are indeed quite low, but the CapEx environment is terrible, so
even if they lowered the bar very low, I believe that it would take
an outstanding quarter to lift these stocks in a significant way,
something that is hard to see happening.
I am one who tries to avoid timing things, so I will stay put.
I am sure that if I sold, a miracle would happen and both
would bolt much higher, such is my luck. Anyway, just do what is
right for you.
As to the recent news I have been posting re Nokia's wins in
China, Saudi Arabia and India, I agree that the market is taking it
just as that, news, not giving it any credibility until it shows up
on the bottom line. Or the market does not believe they are
substantial enough to offset the current wireless sector slump.
That said, I believe they do in fact soften the revenue
declines. More impostantly, these are sticky market share
increases.
Both these companies report next week, INFN on the 26th and NOK
on the 27th (according to ETrade).
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Author:
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LongTerm
CapGains
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Subject:
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Off Topic
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Sentiment:
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Neutral
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Date:
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10/19/16 at 7:16 AM CDT
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lt cap,
Thanks for your take on all this. I feel prettymuch as you do -
timing the market is not something I try to do, as it's something
of a fool's game. And yes, like you, I figure I can drive down the
price of a stock by taking short position, meaning it will
skyrocket. Now, if *Jon* were trying to time the market and placed
a bet, I'd have a lot more confidence, and follow him, as he's
optioned out tons of shares and his cycle is just wash, rinse,
repeat :-)
I meant to look up the CC's on INFN and NOK, so thanks for
including that. It is tempting to sell beforehand, as the odds that
either of them comes up with some upside surprise is low, I'd
think. But if they under deliver again this quarter, logic tells me
they're so beaten down it won't get much worse....except the last
time INFN screwed the pooch, the fall was jaw dropping. I'll flip a
coin, I guess. And I wonder - when the CC is really bad news, is
that where the CEO says, "I'm going to let ..(the CFO, the
CIO)...address that and add more 'color' (so it looks like his
fault not mine. :-)
Another OT deal - I've held some Lionsgate Film as it dropped
from 40 to 20 over time. I would guess that one factor is that the
quality of the films they've put out over the last few years just
aren't nearly as good as what they used to do, and when it seemed
they could do nothing wrong. But I also recall that, almost weekly,
they announce new deals with various partners and strategies -
e.g., selling the overseas rights for a film that offset production
costs, so the chances that revenues from the US would help
cover all production costs were raised. My stake is small, and my
buy-in was lower than its current price, but I still wonder
why.
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Author:
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Jam
ok
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Subject:
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Off Topic
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Sentiment:
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Neutral
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Date:
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10/19/16 at 1:02 PM CDT
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