It’s not rocket science, only a balance between greed and fear, but ultimate success goes to those who can afford to be patient.

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April 13, 2000

By Emckoba, Snr Investment Analyst

Be happy, don’t worry, you are not the only investor caught in this latest freefal. Your stop losses didn’t help you and you are losing your shirt, you are wondering and cussing yourself why you didn’t lock in your gains when they were averaging 150%.

This market is like an elastic band, it can stretch in both directions, wait for the final capitulation to the downside (which is happening now) before you commit to averaging down.

The truth of today’s markets is that a new breed of investment beginners (who tend to think that markets always go up) pushed up the prices of technology stocks far more rapidly than even this high-growth sector could hope to grow.

One development on which you can bet your bottom dollar is that the investment pros who specialize in technology stocks have been selectively adding to their portfolios in recent days eg - WIN/TSE, RIM/TSE, MESG, NOK, CSCO. They know that picking the exact bottom is more a question of luck than skill, and one has to buy up and down the final "V."

But be prepared, too, for some shilly-shallying. Whenever the pros know they can wait for prices to come down, they are unlikely to rush to buy. The first players to lift a market off its lows are invariably the short sellers, as the feeling grows among them that one more period of play is past and they had better begin covering their positions by buying to replace the stocks they borrowed when they originally sold, or, in the case of the option markets, closing out their put positions and thinking about buying some calls.