Hi Walter in HK.
I've always said an investor has to determine whether he/she is the kind of person who will average down or will average up (or will just hold) for the stocks in which a position is undertaken, especially a core position. Averaging down, as market drops -- I see nothing wrong with that. But for core stocks (ala GE), putting in orders currrently 75% of market value is strange to me. If market drops to that extent, and so rapidily (where I feel I have to put such an order in now so as to be able to pick up the stock), I'd rather just be at the phone or computer. I'd like to think I'd just cut my vacation short and get right back to the screen.
Secondly, one either has to have the money set aside now for the buy (uninvested money), or else one has to sell something to pay for the buy (GE). That would mean an emergent, and forced decision (have to sell the dogs of the portfolio.) That in turns means one must be able to identify the dogs, and in a market break, when almost all stocks decline, they all look like dogs. Very difficult, imo, to id. which stocks are least likely to recover. If co. were an actual dog, perhaps it should be kicked out of portfolio BEFORE the market break.
As you say, many ways - 17 to invest. Your method requires patience - trait of value investor. And you have been patient in some stocks for more than a decade. Not so many posters here, imo, have been so tested this way and come through it so well. Certainly not me -g-.
Please post on VSIX, LCAV. I know VSIX's been a big winner for you. We can learn something from your experience. Might be some interest in the stock too, -g-.
regards, Paul in West Coast (USA) |
