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

To: Bruce Brown who wrote (32560)	9/28/2000 8:44:08 PM
From: LindyBill	Read Replies (1) \| Respond to of 54805

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. Hey Bruce, when are you gonna IPO Austria?

To: Bruce Brown who wrote (32560)	9/28/2000 11:05:41 PM
From: kumar	Read Replies (1) \| Respond to of 54805

Bruce, If I understood that table correctly, a 40 year old person putting $10K into "knowledgeable, aggresive companies", could potentially reap $900K in 25 years? do u concur, or did I interpret the table wrong ? cheers, kumar

To: Bruce Brown who wrote (32560)	9/29/2000 12:19:33 AM
From: StockHawk	Respond to of 54805

That was a great post, Bruce. Thanks <eom>

To: Bruce Brown who wrote (32560)	9/29/2000 10:18:14 AM
From: tekboy	Read Replies (1) \| Respond to of 54805

"How come you aren't spending your allowance?" "I'm planning to invest it in a widely diversified portfolio of America's greatest companies, with a small portion reserved for high-growth opportunities." tekboy/Ares@"what'saportfolio?".com . . . . PS that's a hysterical new Schwab commercial, for the non-tv watchers among you...

To: Bruce Brown who wrote (32560)	9/29/2000 10:56:02 AM
From: Mathemagician	Read Replies (2) \| Respond to of 54805

Bruce, That is an excellent illustration of why the LT is such an important piece of LTB&H. It is clear that a goal of 20% per year is certainly sufficient for the creation of wealth in the long term. What Jason is discussing is his particular method of achieving that goal of 20% annual growth. His preferred method is to choose several companies with the potential to increase dramatically each year, in the hopes that one or two actually will. Lindy mentions that, "the ones you take a bath on can kill the big gainers." I'd like to explore that a bit with a goal of 20% in mind. Let's suppose you start with $10,000 and invest it evenly among 10 shiny pebbles with the potential to be very big gainers. Let's also assume that 9 of those 10 perform very poorly. Scenario 1: Those 9 out of 10, on average, lose 90% of their value. (It happens. Trust me.) Initial Return Final Value ONE $1,000 1010% $11,100 NINE $9,000 -90% $900 -------------------------------------------- Overall $10,000 20% $12,000 You see that the one big gainer must be an 11-bagger in order to achieve your goal. However, this scenario of 9 stocks losing 90% of their value is rare. More realistic is... Scenario 2: Those 9 out of 10, on average, lose 50% of their value. Initial Return Final Value ONE $1,000 650% $7,500 NINE $9,000 -50% $4,500 -------------------------------------------- Overall $10,000 20% $12,000 Here, the one big gainer must be about an 8-bagger in order to achieve your goal. Let's try another... Scenario 3: Those 9 out of 10, on average, remain flat, neither gaining nor losing value. Initial Return Final Value ONE $1,000 200% $3,000 NINE $9,000 0% $9,000 -------------------------------------------- Overall $10,000 20% $12,000 Now the one big gainer need be "only" a 3-bagger in order to achieve your goal of 20% growth. The point is this: If you distribute your funds evenly among a large enough number of (carefully chosen) companies at the outset of such an experiment, it is not unreasonable to expect a good overall return. Whether one chooses to invest in ten companies which are likely to appreciate by 20% each over a year or in ten companies, nine of which are likely to fail as investments and one of which is likely to succeed dramatically is a matter of personal preference. Both are equally valid strategies. Regardless, however, it is clear that we all believe that choosing these companies using gorilla game methodology dramatically increases your chance for success. That's why we're here. M

To: Bruce Brown who wrote (32560)	9/29/2000 6:31:15 PM
From: Jason W	Read Replies (1) \| Respond to of 54805

Thanks to those who responded to and discussed my GG smaller cap/shiny pebble strategy. I considered doing a few mathematical examples, but while I thought about it, Mathemagician did it for me, and better than I was going to do myself! BB also added a nice savings table to show the power of steady compound interest over a long time period. After reading everyone’s posts on the topic, I realized that all I REALLY recommended was excluding CSCO EMC INTC MSFT SUNW and ORCL from my future buys, assuming I don’t already own them from a much lower price. ($150B was the market cap criteria I suggested) The stocks that I could still own include GMST JDSU NTAP QCOM SEBL WIND SNDK CREE, etc.., and a select few others from the W&W portfolio. Not a bad group to pick from. I did some additional soul searching as to why I so firmly enjoy and believe in the GG and its criteria. It can be summed it quite easily. “Losing money sucks.” The GG and this board is a wonderful testing ground for a company. There is very little chance that 9 out of 10 companies with a market cap under $150B will lose 90% of their value, assuming they make it past the guys here. I also looked at my current portfolio to see how it was balanced, and where my gains and losses are. I have’nt been practicing the GG for a long enough period of time to have accurate results, but NTAP and GLW are leading the way for me. Every time I have cash available to invest, my heart puts the money into the smaller companies. I have completely abandoned trading, and now buy and hold exclusively. I do tweak my portfolios here and there where needed. The buy and hold theory alone has increased my success greatly. Also, the “buy the basket” strategy, reinforcing winners while letting underperforming companies go, and emphasizing LTBH all increase the chance of success. Focusing on technology, not buying unproven companies, looking for tornadoes, and everything else that applies to the GG has made me a better investor. (I made several hundred trades the past year or so, and with a few exceptions, treaded water and wasted time. Purchasing the Gorilla Game was one of the best buys of my life.) Basically, the thread leaders listened, I learned, and now realize my PERSONAL strategy is acceptable if not accepted by all. I look forward to reading the upcoming Project Hunts, and can’t wait to invest in the companies that pass the test of the minds on this board. Jason W atleastMYmindisclearernow@abigfan.com