Michael Granoff
07-19-2005, 11:11 AM
OK, so last night Cramer says we all MUST own CAT and we must own it before they announce earnings this week.
Great. But of course there is the Cramer rule that we only do Limit orders, not Market orders, and he recently expanded on that saying we should put no more than a 15 cent premium on the current ask. Fine. So last night the ask on CAT was about 50.75. I put in a limit order at 50.90. Today, CAT opens at 52.70! So my oder doesn't get placed. So I'm not in CAT. So Cramer would say that's a good thing, right, because it was a deal at under $51 but it's not a deal at nearly $53. But he thinks this is a great long-term play. So what if he's right, and the thing is at $85 in a year, and it never sees $51 again. Then it was penny-wise and pound-foolish for me not to just do a limit order last night, so I get in at $52 instead of $51.90. Big deal if it's a great long-term play. What gives?
Great. But of course there is the Cramer rule that we only do Limit orders, not Market orders, and he recently expanded on that saying we should put no more than a 15 cent premium on the current ask. Fine. So last night the ask on CAT was about 50.75. I put in a limit order at 50.90. Today, CAT opens at 52.70! So my oder doesn't get placed. So I'm not in CAT. So Cramer would say that's a good thing, right, because it was a deal at under $51 but it's not a deal at nearly $53. But he thinks this is a great long-term play. So what if he's right, and the thing is at $85 in a year, and it never sees $51 again. Then it was penny-wise and pound-foolish for me not to just do a limit order last night, so I get in at $52 instead of $51.90. Big deal if it's a great long-term play. What gives?