Nortel Networks (NT) Message Board

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Technology Stocks : Nortel Networks (NT)

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To: unix_daemon who wrote (8450)	11/12/2000 4:05:06 AM
From: djweiland	Read Replies (1) of 14638

The purchase and sale of securities should be passionless. Emotion distorts one's perception of reality. I AGREE ENTIRELY WITH YOUR PREMISE, BUT IT APPEARS YOU'VE LET EMOTIOMS RULE IN YOUR PRACTICAL APPLICATION. BEAR MARKETS AND 50% (OR MORE) PRICE DROPS ARE GUT WRENCHING. BUT LET'S EMOTIONLESSLY EXAMINE YOUR DECISION TO STEP ASIDE AND GO TO CASH. I WOULD SUBMIT TO YOU THAT A LONG TERM BUY AND HOLD STRATEGY COUPLED WITH A DISCIPLINED VALUATION METHODOLOGY FOR BUYING WILL FAR OUT PERFORM MARKET TIMING. FIRST THE RESULTS, THEN LET'S EXAMINE THE LOGIC. USING SUCH A PHILOSOPHY I'VE HAD AN AVERAGE ANNUAL RETURN OF 36% FOR THE LAST 10 YEARS. THIS INCLUDES THE RECENT 7 MONTH BEAR TECH MARKET. TRY WORKING A MATHEMATICAL MODEL OF MARKET TIMING THAT SHOWS TOTAL RETURNS THAT INCLUDE TAX CONSEQUENCES FOR ONES SELL DECISIONS TO TAKE PROFITS. AS OPPOSED TO A LTB&H THE SIMPLE CALCULATION OF A 20% TAX BITE MAKES THE EIGTH WONDER OF THE WORLD--COMPONDING RATE OF RETURN--A THING OF BEAUTY. DO THE MATH AS AN EDUCATIONAL PROCESS AND THEN LET'S DISCUSS A VALUATION METHODOLOGY THAT ALLOWS ONES EMOTIONS TO STAY IN CHECK AND ONES LONG TERM GAINS TO JUSTIFY THE APPROACH. DJW

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