Good morning ed,
You've made good points, as usual. I agree particularly with your pool analogy. It's easy to make money in a healthy bull market, much more difficult to make (and keep!)it in a sideways, sawtooth or downtrending one. This kind of market insists upon patience and a lot more thinking.
I think investing in technology companies that sell into large markets that are experiencing hypergrowth, particularly those which control their markets because their products are unique and difficult to switch from, is a valid
way to approach the market.
The EMC/NTAP comparison based on fundamentals may, perhaps, miss the point to some degree. Both are engaged in data storage, a market that promises great growth, and NTAP is the younger of the two, whose storage system is complimentary to, and in some ways superior to EMC's. Why not own both?
And finally, with regard to the timing of buys on QCOM and other growth stocks which have pulled back significantly, if one is investing for the long term, the timing of one's purchase means much less than the company one purchases. Nothing has fundamentally changed about Qualcomm and the hypergrowth of its industry. While I feel badly about the short term losses suffered by those who bought QCOM near the high this year, I think they bought a company which will reward them over the long term. And that, of course, is what investing's all about. |
