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

To: chaz who wrote (47260)	9/29/2001 1:56:28 PM
From: Stock Farmer	Read Replies (1) \| Respond to of 54805

Thank's chaz... quite a lot to digest... reply point form or this would take days to type. Responses to every point. Not to counter, but to augment. On struggle: I'm still struggling. On thick skin: useful meanwhile. Those with thin skin can put me on ignore. I don't mind being ignored. I'll make it real easy for folks: click here to ignore me: siliconinvestor.com On responsibility & you standing up. This is what I respect, and what I saw in your post. Mostly :) Takes courage to write "I screwed up" or express self doubt or speak against the tide. Courage or foolishness. You have proven yourself to be of the former camp. Jury's still out on me :) Where else to look? In all honesty: all around! What if in this game of info-hide-and-seek, all the best hiding spaces are where you aren't supposed to look? Maybe one must explore the taboo? You were looking back in March 30. But you allowed the guardians of the taboo to turn you back from the gates. Of course, it's awful hard to know in advance which gates are foolish to cross and which are not. I wish I knew this secret. I'd be rich beyond belief. Does anybody have a theory? Where are opinions? Bluntly? Look around. There for the asking. Like maybe go to one of the dens of bears and ask, for example, "Please somebody tell me why shouldn't I invest in Qualcomm". Even better if you take a stance in the debate: "You should invest in Qualcomm for the following reasons". Then you are forced to expose your own logic and reasoning. Not only to that of a host of others biased to disagree, but to yourself. Better to be humiliated honorably by admitting "I was not thinking straight" than have the market hand me the diploma, prepaid. IM(Thick Skinned)HO Bearish groupthink is just as silly as bullish groupthink. So both "sides" in the debate can win in the end. Threads: particularly where there are both macro and well-informed collision of views? I suggest lurking CFZ: Subject 34445 but it is a place where folks work so asking about qualcomm may not be productive. If you want to post where folks seem to have the mental agility to discuss everything from orbital mechanics to the price of rice in China, I suggest posting here: Subject 37210 but it can sometimes get a bit up close and personal, and their views are deeply held and sometimes grim... All in fun. And Qualcomm is a regular subject of discussion. Or join in at the Cisco thread. Or any of the Gorilla or topic threads that have a bull:bear ratio that's considerably less than infinite. AMZN is another one I've noticed. These tend to be a little more rough and tumble than G&K. That takes courage of course. It's easier to go to the Qualcomm thread and say "Wow, looks like business is rosy". Maybe like "risk/reward" there's a return on pain. No pain, no gain? On Market turns. Yes, it will. And this is what I fear: that I might miss the up like others missed the down. Become cocky and not listen. Acutely aware. On seeking the smarter folks, yes. Always. Which is why I am out in the debate. But not merely to nod and go with the flow. To challenge too and listen for the logic that sticks. I've learned a lot from the bullish at Cisco. Ok, on Cisco. As example. No I do not hold position that stock is to avoid because cash will be depleted. I posted (other posts nearby) that cash flow has returned positive. Instead I am looking at cash flow sources and seeing them wither instead of grow. My post was an example of looking beneath the covers of the pro-forma statement, diving deep into the 10K and crawling around in the guts of an important part of the business. What sent me there? Looking in cash flow statement trends & balance sheet analysis. What sent me there? Relentlessly following the money. That's what makes a company worth what it's worth. All the market share in the world doesn't matter if the company fails to monetize it as profit. And a million grains of sand don't add up to a mountain either. So the degree of profit matters to the price of the whole, of which a slice is an equal share. The price of a slice matters to an investor. Not much more to it than that simple ladder of logic. Just lots of work. Each company is different. Having said what my opinion isn't, what is my opinion? Slice isn't attracting the cash growth it used to, IMHO. And cash growth is lifeblood of growing company. Yet slice commands a higher relative price? Hmmm... Blinkers & bible. Intentional juxtaposition? If so, the alegorical implications are rich in texture... e.g. as Marx viewed religion as an opiate... Bibles & the word, versus churches & its practice... the gospel according to whom? Rich indeed. Food for much thought. But discussing religion is hard on folks with thin skins. On stops: 8%? Looking at long term charts, with only 8% a person with LTBH would be jerked around like a dog on a leash on the end of a helicopter rotor. I think stops that tight are for shorter timeframes than this thread likes to contemplate. Even setting aside bubble, even good co's had bad times. But few came back quickly from 25% hits. For those who don't like to shift positions often, maybe 20-30% stops are good enough? From recent WSJ: Warren Buffett's most difficult-to-follow advice is "Above all else, don't lose." And even he loses, so we're all in good company. 30% from bubble top would be nice, yes? But that's woulda-coulda-shoulda except as historical support for a strategy. Real question is: what will you do if it drops 20% from here, will you stick it out? What if it goes up 20% from here? 200%? 300%? Besides dance, will you take profit? Yes or no... no pre-ordained "right answer". Each answer custom to each person and perspective. Even better that the question is pre-answered using far-view objectivity. And I prefer to challenge the wisdom of a strategy that delivers sub-optimum results. According to objective criteria set reasonably in advance. Or when exogenous circumstances change substantially. Taxes? Can it be real profit if it doesn't show on the income tax form? Whew. Enough said. Not offering up "the answer". Just my opinion. I have no delusions that it is all correct. Hopefully you can help me plug the holes. John.

To: chaz who wrote (47260)	9/29/2001 2:06:19 PM
From: RobertHChaney	Read Replies (3) \| Respond to of 54805

A stop as an investment tool? IMO, a stop is really a stock trading tool, not an investment tool. I can't remember reading of any great fundamental investor who uses them as a basic part of their approach. In fact, Warren Buffett recommends that you should not invest in a company if you are not prepared to hold on and later invest more if it falls significantly. This would also take into account the Peter Lynch "dollar cost averaging" concept. There are many successful fundamental investors and many successful stock traders. But, I think each approach requires very different skills and mindsets which are difficult to blend together. Therefore, it would be hard to create a successful approach that attempts to combine fundamental investing with the art of stock trading. In particular, I would question if stops would work well over the long term in conjunction with a Gorilla Game fundamental investment approach. Stops mainly appear to have fundamental validity based on trends like we have witnessed over the last 2 years. However, I would suggest that the superior "stop" mechanism would have been to stop playing the market when it reached absurd valuation levels and sell out. Then, when valuations become historically cheap again (which IMHO they are not yet), make fundamentally sound investments in Gorilla and King companies, and have money in reserve to dollar cost average downward. And, don't attempt the impossible task of trying to pick the exact bottoms for the market or individual stocks. I think stops would only complicate this basic process. JHMO, as this is what I plan to do. Robert