Paul, it's a great question and IMO a tough one to answer rationally. A question you don't hear talked enough among longer term investors. I'll tell you my thoughts as it relates to my personal thinking. I don't always follow the norm. The normal rational is usually different among fundamentalists (their own style). I usually hear this common phrase. It's dead money. Find a better place to put it with better prospects.
I sure do make mistakes and sometimes big ones.
This statement below is key for me.
>IMO- . Simply put, when I have a good year. I take bigger risks.
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Back to your question >just how long is one patient with stocks that go no where?
I mentioned earlier about the saying, dead money. IMO it's not exactly dead money if a stock is bringing in income (dividend income).
In regards to SPPI
SPPI Future potential plays a key. This in regards to stocks that don't pay a dividend. Also, your own confidence in the company. That could be determined by what the insiders are doing? In SPPI case, they have been net buyers. Tax loss implications play a role for me also. Can I offset the loss currently or do I want to offset it later? Or do I want to carry forward a loss that wasn't offset. I also ask myself. Why did I buy the stock in the first place? Are conditions still there? Am I cutting portfolio risk or adding risk through diversification with this stock?
Risk involved plays a big role for me. I'm assuming as a longer term investor yourself. Like me, you will dollar cost average if you have decided to stay in. With a company like SPPI the risk is big, but so is the payoff IMO. I have accumulated shares over the years at a much lower cost basis. 4-low five range. I have personally decided to cut my risk now because I have all remaining shares in the money. We are also getting close to an event, FDA approval. What if it doesn't get approved?
To try and sum every thing up. I think you have to make decisions on stocks on case by case basis (your style). Determined by where your shares are, and current market conditions in relation to your portfolios condition.
If I haven't lost you yet. IMO There's always that human factor witch ties into your own style of investing, and back to the statement. >Your success or mistakes will determine how outside your own discipline you will venture. My own style of self discipline has probably kept me from progressing at a faster pace over the years. I have however progressed from the buy and hold strategies of old, to employ newer techniques of today’s market conditions. Even though I regard myself as a fundamentalist. I still believe the statement "TIMING IS EVERYTHING" is shared between Fundamentalists and market technicians. Part of the newer market conditions I've been open to, is, to try new things.
At this point in time. Don't know if what I said helps, but I'm fairly sure we both want to make money, and want to have some control over it?
RR |
