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Strategies & Market Trends : Gorilla and King Portfolio Candidates

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To: Uncle Frank who wrote (44501)	7/16/2001 11:42:15 AM
From: Stock Farmer	Read Replies (2) of 54805

uf - I noted your question to Earlie re. length of holding. Triggered me thinking about "Long Term Buy Hold" as a pillar of investment strategy. The longest I've held any stock is 18 years. And counting. Which is forever relative to my own investing history. The shortest I've maintained a position in a company is 6 months. So firstly, I offer this context to qualify myself as a "long term" investor. Not an "old" investor, just that my bias in making decisions and sticking with them is not biased by the direction of the wind or determined by the head and shoulders of headless chickens. Nor by the temporary continuation of discontinuous trends, or by goat entrails or tea leaves or other tools of "TA". I will not be impolite and quantify the results, except to state that my current lifestyle is a testament to the merits of what surely must qualify as "LTBH investing". This foundation established, next I would point out (politely at first but if necessary, then less so) that the much vaunted "Long Term Buy Hold" mentality of successful investing is not called "Forever Buy Hold" by accident. It is not called "Five Year Buy Hold" or "Fifteen Year Buy Hold" or "Bury me with my certificates" and so on. Nor is it the be-all and end all of effective strategies. Indeed, for those who have skill and intelligence and a certain amount of experience, it is not the most effective strategy at all. Witness the last few months which have set even our Gorilla portfolios back to 1999. Or even earlier on a profitability basis if any money was injected in the last two years. Maybe it's just me, but I fail to see wisdom in the word "Long" being interpreted such that any occasional selling after 6 months or (rarely) six weeks or even (more rarely) six days disqualifies an investor being "LTBH". Although I would say that circumstances must be rare indeed if someone professes a "LTBH" strategy and yet never holds a stock through a quarter. Perhaps you can accept that my definition of "Long" is quantum mechanical rather than Newtonian. Rooted in the uncertainty principle and with a gaussian probability distribution along the time line. As opposed to some absolute duration against which any other interval is categorically "long" or not. Indeed, in this light I might even suppose it is possible to have a "long term" short bias. Despite how (oxy)moronic that may seem. The term "long" being relative, not absolute. John.

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