Jeffrey Bash: re: "A 50% gain in 2 years isn't enough for me to buy a stock". Well if such stocks buys are available and if that is not good enough for you, I must conclude you are someone who requires extreme results of his portfolio. Given that the best investors cannot make 25% on their money consistently, nor, I think, even inconsistently but on average, what is it that you do to achieve such results? (Or are you saying you just shoot for the stars to expect something a lot less?) Is it a concentrated portfolio? I don't recall seeing any studies (they may exist and be generally available, I just don't know)which show that value investors can expect such favorable results. I've seen stories of people who have specific investments that do about 25%/yr. for many years (somebody on this thread in Tyco for a dozen years; somebody on the Abbott (ABT) thread whose base cost is under $1/sh.; a drip investor in AFLAC since 1985, etc.) But these seem to be isolated investments that went roaringly well - unexpectedly and unplanned well. Graham's idea I thought was that value investing was a place to invest, not necessarily to become roaringly rich.
We're all different. To me, if I had 4 stocks that I thought would go up 50% in two years, and two of them actually did and I was on board, that'd be about 12 1/2 % annual return before taxes. Given where I am, that's not bad, especially if that performance could be replicated every year. Or if the gains came before two years, which sometimes seems to have occurred in this market.
Paul |
