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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: tekboy who wrote (24766)	5/15/2000 12:48:00 AM
From: Mike Buckley	Read Replies (1) \| Respond to of 54805

Great post, tekboy! Different strokes for different folks, in other words, so it's not surprising that the subject produces flame wars. Actually, I never have understood why some of the people in the two camps (LTB&H and trading)are so sensitive about their chosen method. Merlin and, say, Voltaire are different people, with different skills, and should follow different approaches. I don't know anything about Voltaire, but I would like to add that to put the skills of long-term and short-term stuff to use, the two skill sets require different kinds of discipline. I believe a lot of people have the requisite skills to use either method profitably but lose out because they someimes lack the discipline to put the skills to use in a consistent manner. I should add that for a couple of years I have reserved about 10% of my portfolio for some short-term opportunities in the form of screaming buys that become apparent to me as a result of my daily reading. Because I determine those opportunities using traditional valuations, you won't be surprised to learn that it's been a long time since I've discovered any. As a result, I've used most of my cash position for long-term opportunities that aren't what I call screaming buys. --Mike Buckley

To: tekboy who wrote (24766)	5/15/2000 7:22:00 AM
From: gdichaz	Respond to of 54805

tekboy: There are many ways to think about buying and holding vs timing the market. One very basic way is to consider trends and fluctuations. Trends continue. Fluctuations don't - they reverse. Trends: There are at least 3 trends underlying buy and hold. Growth in the economy. Growth in a technology. Growth in a company - a gorilla or king. Fluctuations: The waves of fluctuations ride these trends. The amplitude of the fluctuations is miniscule in comparison to the power of the combined trends. Therefore like the old story about robbing banks of going where the money is, the money is in the trends not the fluctuations. This is simplistic in the extreme, and of course money can be made (and lost)with many approaches. Having the trends going for you give you an advantage - particularly if your timing is wrong - the trends are your friend. Nothing helps if your timing is wrong re fluctuations. Best. Thanks for initiating this discussion. Cha2 PS Trends can be discovered and analyzed with logic, since there is substance to them. Fluctuations reflect emotions and defy logical analysis but require "systems", "models" or other artificial aids to attempt to outguess random and/or largely unpredictable moves. PPS Spending my limited attention span on finding key technologies and then their leading companies (gorillas or kings when possible) works well for me. Having devoted most of my energy and limited capacity to choosing as well as I can, I can relax and only sell when fundamentals change. (My choice after long long experience at trying every "approach" I could find to experiment with.)

To: tekboy who wrote (24766)	5/15/2000 10:57:00 AM
From: gdichaz	Respond to of 54805

tekboy: Addendum on buy and hold: Note substance matters and can be factored in: Message 13711507 2nd Note: An essential component of buy and hold is the ability to avoid any forced sale - especially a panic sale - both monetarily and pshchologically. This means cash or other resources for living and limited (or best, no) margin exposure. Best. Cha2 PS "Shy guy's point is the Q is where it was Dec 10 in stock price. Yet strength squared in the fundamentals.

To: tekboy who wrote (24766)	5/15/2000 7:58:00 PM
From: 100cfm	Read Replies (1) \| Respond to of 54805

Tekboy Up until today when I had a 1 hr phone therapy session with a wise threadmate, I too have been dazed and confused by my portfolio losses and was questioning the LTB&H strategy. In nature most things will follow the path of least resistance, we too as humans have a natural tendency to want to do the same thing. So after the pummeling we all have taken it's natural to think that the buy and sell system was the path we should have taken. I am now convinced that the path of least resistance (market timing/take a profit and run) is not the best path for longterm wealth accumulation. It may be the best for racking up short term profits and taxes and that may seem like not such a bad thing right now, it all depends on what one's goals and needs are. For sure the hardest thing to do is to do nothing as you watch your stocks plunge to levels one never dared to imagine and then have the faith that they will come back because they are great companies. This may be the best thing that ever happend to some of us, because if we hold thru this and it all comes back then we can weather anything and I mean anything that the market throws our way in the future, assuming of course we stick to proper investing fundamentals. As I was barely able to turn on the computer and lurk because I would get all worked up from the Fud flying from all directions I was saying how the hell can Merlin be acting like it's another day in the park. Then when he posted that he held Citrix thru five 50% drops in 2 yrs I realized why. No wonder he gave the speech he did in San Diego, he was way over due for a 50% plunge in some of his stocks<g>. We could all be wrong and history not repeat itself but I look at this way, if I'm not even smart enough to snatch an open bottle of Opus there's no way I'll ever buy the bottom and sell the top. 100