I recall BB, or someone else possibly, looking into Off Road Capital and other venture type funds. If those types of opportunties are being considered by others on this board, than an "aggessive shiny pebble" portfolio may be an option also.
Yes, I asked on this thread during the summer if anybody knew about a couple of VC firms that had sent me their information. I'm not a resident of the U.S. at the moment, so I don't qualify. One of the VC firms allowed investors to choose which ventures the capital should be directed. That appeared interesting to me, but I don't know much more than that. I'll probably look into it again once we live in the states if I'm still interested with a small amount of money being used in that manner.
The Gorillas with market caps of $150B or so and up will not turn into the 5 or 10 baggers that I am hoping to invest in. I fully understand the risk associated with buying "shiny pebbles", but to make it past the minds that be here on the G&K thread, combined with my own DD and gut instincts, I choose to follow this path. This is not to say that I don't own some larger caps.
That is a common theme on investing message boards. It seems like it's rare to find a small-cap like i2, Siebel or Dell these days. It seems like if you do find one, they IPO as a smaller mid-cap or get there fairly quickly after the IPO (like by lunch time). As examples, this happened with Brocade, Redback, Juniper, Ariba, CommerceOne, Foundry, Sycamore, Ciena and some others in the past year or two.
Does a 10 bagger feel good? It sure does. It looks like Apple is back to a 3 bagger total after 15 years of being a traded company. Rather than concentrating on bagging some baggers, I think it is more prudent to concentrate on investing in a good business first using the gorilla game criteria. The bags will take care of themselves. You can make a hell of a lot of money over your investing career with a 15 - 20% annual return. Let me borrow a little information from the Fool about teaching your children to invest:
fool.com
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For instance, if a child invests $100 of birthday money at the age of 15, the long-term results are impressive. The following table shows a few different growth rates: 5% is the anticipated return if that $100 is invested in a money market account or bonds; 10% is the average return rate of the stock market; 15% is a little better than the average stock market return; and 20% is the return a knowledgeable, aggressive investor might see.
Age 5% 10% 15% 20%
15 $100 $100 $100 $100
20 $128 $161 $201 $249
25 $163 $259 $405 $619
30 $208 $418 $814 $1,541
40 $339 $1,083 $3,292 $9,540
50 $552 $2,810 $13,318 $59,067
60 $899 $7,289 $53,877 $365,726
65 $1,147 $11,739 $108,366 $910,044
That little $100 bill would have become more than 9,000 hundred-dollar bills ($910,000) at age 65 with a 20% return. Now that's a return worth waiting for!
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Although we would all like to have a quick 5 or 10 bagger, one should really focus on the long term accumulation and compounding of great companies. If you are patient, you will find a grand slam like Dell, i2, Siebel, Network Appliance, etc... every now and then to make it all worth while.
Although I hit the big 39 on the 20th of this month, I still consider myself young and have plenty more investing years to go. Enough to invest a portion of my money in younger companies to balance out the mix with the more mature large-caps. You see how 'stable' a stock like Intel can be? <ggg> There's a company that, even with the revenue shortfall, will still come in at 17 - 19% y/y revenue growth this quarter as a 30 year old company. That's fine by me. I've also got some that will come in at 300 to 500%+ y/y this quarter as well.
Are there some small-caps available at the moment that appear to be playing in a gorilla game? Are there upcoming IPO's that appear to be playing in a gorilla game? Are there companies with a market cap between $5 and $25 Billion that appear to be playing in a gorilla game? Most likely you would be able to turn up something in one of those areas that just might be worthy of consideration. You've seen what two of the younger G&K portfolio members - Siebel and Network Appliance - have done since going public not too many years ago. There will be others. The W&W list has some very compelling companies, but is not an all exclusive list of possibilities.
BB |
