What do you think?

KTP · #1 (**permalink**) 10-19-2009, 05:05 PM

Do any of you think the strong Apple earnings will have a positive effect on Microsoft stock tommorow or anytime this week before their earnings call?

I need to unload 1000 shares in order to buy some municipal bonds but I am unsure if I should do it before earnings, after earnings, before Win 7 release, or after Win 7 release...

please pass the crystal ball

Maybe 250 shares during each of those time periods would be best...

LuxLiving · #2 (**permalink**) 10-19-2009, 05:09 PM

Here, use mine. It looks a little foggy though from where I'm sitting...

disneysteve · #3 (**permalink**) 10-19-2009, 05:12 PM

No crystal ball here. I say put in a trailing limit order and be done with it.

KTP · #4 (**permalink**) 10-19-2009, 06:07 PM

a trailing what?

Ok, I had to go look that up. It is still kind of fuzzy. So a trailing limit order will trigger when the stock declines a certain amount, even on a run up?

Example: You have a trailing limit order for Company XYZ currently at $10 to trigger at a drop of $0.50. The stock goes from $10 to $13 intraday, and right before close it drops to $12.40, triggering your limit order.

I guess it would also trigger if the stock had initially dropped to $9.60?

disneysteve · #5 (**permalink**) 10-19-2009, 07:09 PM

Yep. That's how it works. That way, you don't sell too soon and miss a good run up. You don't want to sell at $10 and have it go to $13 later in the day. With the trailing limit, the sell wouldn't be triggered until it dipped down to your set point.

buildmybudget · #6 (**permalink**) 10-19-2009, 07:17 PM

Just curious, why are you unloading the Apple shares for Muni's?

DRILLINDK · #7 (**permalink**) 10-19-2009, 07:46 PM

BTW, I picked up a 195/200 Vertical Call spread in Apple today for 1.5

Can you say BOOYAH!

KTP · #8 (**permalink**) 10-19-2009, 08:03 PM

Not apple shares, microsoft shares.

I wish I had had some apple shares today.

I am unloading the microsoft shares because we are overexposed to them due to options and stuff.

I am buying muni fund to diversify a bit. Right now I am like 80% stocks and stock index and 20% cash.

Broken Arrow · #9 (**permalink**) 10-21-2009, 01:42 AM

Hahaha, great pic, Lux.

Quote:

Originally Posted by KTP

Do any of you think the strong Apple earnings will have a positive effect on Microsoft stock tommorow or anytime this week before their earnings call?

In my personal opinion, Apple does not have an effect on Microsoft's stock performance. If you will pardon the pun, I believe they are in many ways, comparing apples to oranges.

Of course, general optimism in the tech sector can always have an effect on any tech stocks, but I don't think that specifically translates to a Apple/Microsoft correlation.

Also, I highly advise against trying to time the market to quarterly earnings. Seriously. I've been burned one too many times on that. It always looks easy until you try it, and you realize that you're wading into waves being deliberately rocked around by Big Money, and it's very easy to get caught on the wrong end of the wave.

Finally, I am extremely optimistic of Windows 7's future prospects. Enough that I had seriously considered buying in myself. However, I also believe that buying in now would only be a buying at "fair value". Which is OK if you plan on holding in a dividend strategy. Growth strategy? Not so much....

The reason is that I hear only 60% of all major clients that Microsoft work with are buying Window 7 to upgrade their infrastructure. However, while Windows 7's adoption may not turn out to be explosive, it will eventually come to dominate the PC landscape again. It will. Mark my words. It may not look like it on the surface, but there's nothing out there quite like this.

In other words, I believe MSFT is best as a buy-and-hold. Think 2 to 3 years in order to fully realize this trade.

Quote:

I need to unload 1000 shares in order to buy some municipal bonds but I am unsure if I should do it before earnings, after earnings, before Win 7 release, or after Win 7 release...

Again, my recommendation is to shift your asset allocation in a way that will work best for YOU, regardless of market performance. Hopefully, MSFT has already made a decent gain for you and you'll already be locking in a tidy profit.

disneysteve · #10 (**permalink**) 10-23-2009, 08:39 AM

So what did you do? Did you sell before or after it shot up?

KTP · #11 (**permalink**) 10-23-2009, 09:06 AM

I was going to sell yesterday but at the last minute decided there was something strange about them reporting earnings on friday morning before the bell so I waited until today!

I sold my 1000 shares at 29.1 right at the open! woo hoo!

Also I sold 920 msft shares in my little rollover IRA at 29.05. That little rollover IRA that I totally scoffed at 4 years ago when it was $3000 is now worth almost $27,000 with 0 additional contributions

I don't scoff at it as much now.

The only downside is it is preventing me from opening a regular IRA and then converting it to a Roth immediately. I have a good solution for the funds in it though...I am going to put them all in a international Vanguard fund and let that, along with my wife's IRA->Roth thing be the international part of our portfolio. This way we don't have to worry about the high taxes that might be generated in that sector due to gains and currency fluctuations.

Unsure exactly what to do with the 29,100 I just made from the other msft stock sale...maybe put more into the intermediate term vanguard muni fund and half spread out around some good dividend paying companies. Both of those options have good tax treatment and relative safety.

Anyway, doing the happy dance a bit!

disneysteve · #12 (**permalink**) 10-23-2009, 12:42 PM

Quote:

Originally Posted by KTP

That little rollover IRA that I totally scoffed at 4 years ago when it was $3000 is now worth almost $27,000 with 0 additional contributions

I don't scoff at it as much now.

Wow! What a great example of the power of investing and compounding. What's that old saying? From little acorns mighty oak trees grow.

Anybody who thinks it isn't worth investing if you don't have tens of thousands of dollars can look to this example.

Broken Arrow · #13 (**permalink**) 10-23-2009, 01:59 PM

Congrats! Just out of curiosity, how much was it when you bought it? Why did you decide to buy it at the time you did?

KTP · #14 (**permalink**) 10-23-2009, 06:21 PM

BrokenArrow:

The shares were part of a company stock grant thing. The other shares that were in my rollover IRA I purchased back in March when microsoft (and other stocks) were trading at insanely low prices. At the time I had my money in Exxon, which for some reason didn't get hit nearly as hard by the March lows. I sold it right about even money and bought the msft back then at around $18 a share or thereabouts. Nice tidy $11 share profit in a few months huh?

The 3 grand grew to this with several lucky (and I do realize they were lucky) trades like that over the past 4 years.