I posted this on the AMAT thread:
To:Brian Kerecz who wrote (742)
From: Fred Levine
Monday, Mar 4, 2002 9:08 AM
Respond to of 744
A reflection from someone who watched my tech holdings drop precipitously:
I think mistakes can be enormously important vehicles for learning. Indeed, I just finished writing a book where this is one of the major theses. In
retrospect, I missed all the warnings from analysts that portended doom and gloom in techs, and it cost me money, especially in EMC and SCMR.
We all know that analysts have a positive bias. Just look at the ratio of "Buy" to "Sell" recommendations. Therefore, we should give more credence to
negative recommendations than positive ones. ML, SSB, and others were making negative recommendations during the time that AMAT, and others,
were posting record results and I, therefore, ignored them. Given the standard positive bias, I should have paid heed.
BTW, my book also has a section that saying, "if only" is a great way to become miserable, and is fruitless. I think I learned something. Negative
recommendations have more validity than positive ones.
comments?
fred |
