Mr. Voltaire...The following was sent to me from a friend who got it from another message board so I really can't give credit to anyone. But with the ups and downs we have faced lately with some of our G & K stocks I thought it would be interesting to share.
Anyone that gets so nervous that they cannot wait as long (as short) as another week or
two should reconsider their fortitude for investing. If you look at any of the huge
moneymaking stock market stories over the last five years and you wonder - boy it was
so easy - just invest $100 in Dell and take out $750,000 five years later - why couldn't I
have gotten in on that? The answer is you could have, but most people are too blind, too
squeamish, too quick to panic, too quick to take short-term profits, too near-sighted to
envision the true magnitude of the "down the road" potential, too easily excited by
"positive posts" while at the same time too easily vexed by the "negative ones" to realize
what they have in front of them until it's gone.
There are no "sure things" but some are closer than others. Many of the most successful
investors wear "blinders", earplugs, whatever it takes to remove themselves from the
daily grind of pessimism and the weekly/monthly grind of volatile stock swings as they go
by their instincts.
Study any of the most successful stocks over the last 3 years and chart what was being
said about them "then" and how investors were reacting to those words "then" and
compare that to where they are "now." and you will see some startling contrasts. A
perfect example is AOL. (Yes, we all realize that the Internet sector has been sagging as
of late, but regardless of that, an investment in AOL 2-3 years ago would still be worth
major bucks today after 6 stock splits.) Look at the history of AOL's last 3 years and you
will be amazed at the moments of pessimism and stock downturns.
Most of the daily followers of AOL that bought in 3 years ago were scared out 1 to 2 years
ago. It sounds hard to believe but there were many times that you could have read AOL's
obituary. I know, because before I started investing in the stock market, I said to myself -
AOL - wow, it was (is) so easy to make money - everybody should be rich but their not. -
Why? - So I went back and read every article in "The Street.Com's" archives and looked
up countless prior news and commentaries on AOL at various news sites to understand
and help me gain the "confidence to relax." The answer is that throughout any company's
path to success there are many moments of anxiety, moments of doubt, moments
requiring great patience and moment's that invoke.
"Murphy's 3rd Corollary of Stock Investing" which states: "All stocks experience
downturns just long enough to induce you to sell on the morning of the day that it
rebounds." And also. "Mur-phy's 2nd Postulate of psychological Market Parameters"
(commonly referred to as M2PPMP) which indicates that: "For every piece of good news
that invokes you to buy there will be two pieces of follow-up commentary that will convince
you to sell too soon." So who made out the best in AOL (even with its currently depressed
price?) Certainly not the M2PPMP crowd, but the investors that wore their blinders. I'm
content to put my blinders on. But alas, in the end, every-one has to make their own
decision based upon their own lives. But if a few weeks or a few downturns is all that it
takes to scare you out of what may potentially be the Stock that will change your life then
so be it, fall victim to M2PPMP and be content in the fact that you can still live vicariously
through the rest of us willing to go the distance and reap the rewards "
H Peterson |
