Hi I2! I see how RPM's been hit with the asbestos problem today. Ouch!
I've been attempting to avoid investing in any company with asbestos problems. I repeat as a mantra the opinion of Jim Clarke here: "There are no small asbestos problems"
I count at least two errors of omission for me with this tactic: Both Haliburton and Sealed Air recovered from their sudden downdrafts. So at some point down at lows, they were buys -- in hindsight anyway. Sealed Air stockholders suffered for a while, but suddenly the stock doubled when SEE announced a legal settlement.
I have at least one positive experience:
I sold COO about a year ago after somebody here brought its asbestos problems to my attention. That stock later did suddenly drop (on asbestos worries), but I see now it has recovered to near my sell point.
That so many companies are involved in asbestos litigation makes it hard for me to totally avoid being exposed to these stocks, given how I like to diversify. So I have possible errors of commission as a result: I have long-term, but very small positions in HON, ABL, DRRA, NSI which appear inexpensive to me. With companies such as these, I'm not willing to close the position at current (low) price. OTOH, because of the asbestos issues, I'm also very reluctant add to the position.
Paul Senior |
