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Non-Tech : The Critical Investing Workshop -- Ignore unavailable to you. Want to Upgrade?

To: bonnuss_in_austin who wrote (34320)	12/11/2000 2:45:31 PM
From: abuelita	Respond to of 35685

From my broker. It's nothing we don't already know, but I feels good to hear it again: "The Gorilla Game The great investor Warren Buffett was asked once why he didn't own pharmaceutical stocks. He said, frankly, that he made an error in judgment. There are great businesses in the pharmaceutical sector. The problem, Buffett noted, was that it was difficult to pick the winner. He concluded by noting that if he were to invest in pharmaceutical stocks, he would probably buy a basket of the leading companies. This makes perfect sense to us. There is a name for this type of investing. It's called the Gorilla Game. To understand how to play the game, we recommend you pick up a copy of a book by Geoffrey A. Moore called The Gorilla Game. For those of you who just can't wait to read the book, here is the basic idea. Everybody knows investing in high growth sectors can be a risky affair. No single individual-not even the great Warren Buffett-is smart enough to pick the winners in dynamic sectors such as pharmaceuticals, technology, communications and biotechnology. Given this, the intelligent thing to do is find a portfolio manager that can invest in a basket of stocks that have great potential. Not all of the companies in the basket will become superstars. But some will. Over time, a good portfolio manager will let his winners run (i.e., hold those companies that become Gorillas-kings of the jungle!) and prune his losers (i.e., sell those companies that remain chimps). Of course, playing the Gorilla Game requires a good deal of patience. As the great portfolio Peter Lynch once noted, the key to making money in stocks is not to get scared out of them. In this day and age, it is rather disturbing to find that the average holding period for a company like Priceline.com is 72 hours. The day traders may be having fun, but they are probably not making very much money. In fact, we don't know any traders that have made Forbes' list of the world's wealthiest people. If you want to make money investing in high growth sectors, learn to play the Gorilla Game."