Thursday, January 06, 2005


AEHR's mysterious ways

Back in black today: up $7,000. AEHR reported earnings after the close, as well as announcing a new order from Sanmina. In my experience, when a company releases two press releases simultaneously, that usually means one is bad and the other is good (with the hope that the good news deflects the bad). And sure enough, the earnings were mediocre at best (eps in line, but revenues projected to decline next quarter). Initially, the stock fell 5 percent in afterhours, and then began to rally, rising 30 percent. I'm not sure why it rallied, because the conference call wasn't too enlightening as far as I could discern. Well, I sold half my shares at $4.35 (the strategy of "sell first, ask questions later" has worked well enough for me in the past, so I see no reason to deviate from it now). Tomorrow will tell whether this was a good move.

A few percent again... that's pretty good considering the bloodshed in the market the last few days. I am down more than 2% of portfolio and sucks. What do you think of all the analysts saying 2005 will be slow growth and might go down in US but more up in Asia and Europe?
My sense is that most analysts still expect the stock market to go up in 2005, though not as much as the 10 percent historic average. My bet, however, is that it will go down. I wouldn't be surprised at all if the NASDAQ ended below 2000 for the year.
Are you going to still focus on US market and perhaps do more shorting? Or put some money in foreign funds like the iShares? Or continue as now and focus on small and micro caps?
I'm going to continue to focus on small cap US stocks, but I'm also trying to increase in my short exposure, as I think the market is likely to decline over the next few years.
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