I'm bearish for tech stocks and industrials. But nothing else really.
If indices fall, value might not go down.
The only reason indices have gone up is because of the way they're weighted. Big tech is up, so indices follow. 2021 was still more crazy than this because everything went up.
I do not share that view. If I get a sense things are turning I would rather protect my downside than stay invested and take hits. If I buy a stock for $10/s and it drops to $6.50 that's a 35% decline but to get back to $10 that's a 54% increase. Reading too much Harry Shultz literature I guess.
True, but if it were already undervalued at $10, wouldn't you buy? You don't know if it's going to fall.
I am putting a higher emphasis on a balance sheet "margin of safety" now which I think is helping.
Maybe I'm early, but if I am, I didn't lose any money either. Missing gains is not the same as losing money.
I can get behind this in certain circumstances. But I'm sick of buying 100% cheap companies. My focus this year has been to find long-term plays. Unfortunately, CUTR just didn't work out with management saying they'll burn $90m this year.
My new final check is "if the company falls 50% tomorrow, how would you feel?" In the past, many companies I bought, I wouldn't want to decline quickly. If BIDU or ELA fell 50% on Monday, I'd be comfortable with that. |
