I suggest some think about the fact they may only be fair weather friends.
Glenn - I certainly don't wish to get involved in the skirmishes that are currently going on on this thread (it's much more enjoyable to just sit back and watch).
I feel compelled, though, to add something here. I am in total agreement with Sarmad's assertion that some of the run-ups in new economy stock prices that the market has seen over the past two years had much more to do with momentum or "herd" investing, than with investing on any informed and objective analysis of business prospects. Because of my inclination to believe this, I stayed away from going long many of the new economy stocks. Yes, I admit, I did go long some stocks from time to time (I even bought AMZN once) - but if I add up my gains from being long these stocks, my returns are nothing to write home about (except for MSFT - although I don't really classify MSFT as a new economy stock).
While some on this thread have made a lot of money in new economy stocks, it's probably due to getting into a few key stocks very early. I have several friends that have lost a lot of money this year - from investing only in new economy stocks - and for those friends that have revealed the details of their losses, most have indicated that the losses this year have set them back one, two or three years (in one case, much more).
My experience, therefore, differs from that of those promoting new economy stocks - my experience has shown that investing in new economy stocks can result in wealth destruction.
And I must add something else here. There have been times that I have posted trades to this thread that involved shorting new economy stocks (I now try to refrain from posting my trades) - and I recall taking some heat for going short these stocks. I recall one time when I posted last summer that I had shorted ICGE at a post-split price of about 140 - and I was essentially told by one participant on this thread that I was crazy for such a trade. Crazy? Why? Because I failed to recognize the fundamentals of ICGE? Or crazy because I was trading on fundamentals? Regardless, I covered at a small loss - but with ICGE at 25 today, I sure wish I had held the position.
Thanks,
-Eric |
