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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Dale Baker who wrote (17583)	8/16/2003 1:41:36 PM
From: Brinks	Read Replies (1) \| Respond to of 78531

The world's greatest value investor made a major market call recently that was largely ignored by the media: fool.com thestreet.com

To: Dale Baker who wrote (17583)	8/16/2003 8:07:27 PM
From: rjm2	Read Replies (3) \| Respond to of 78531

Dale Baker I believe I have seen evidence that periods of extreme overall insider selling tend to be followed by periods of down to flat markets. Similarly, I have seen & believe evidence that when many investors are optimistic, it pays to be the opposite. Combine the above with my inability to find the kind of buys that I find compelling and it makes me wonder if I should not take it a step further and look to further lighten up my overall equity positions in order to have more cash available for when both overall and specific situations appear more favorable. I believe a rising tide lists nearly all boats and vice versa. Sure, a few stocks might react otherwise but I doubt my or anyones ability to consistently choose those stocks that react favorably to any market environment. I disagree 100% with your statement that I am mixing momentum market timing with value investing. I agree that value investors dont follow the herd. Indeed, the herd is BUYING stocks that the ultimate value investors (insiders) are selling them. I am suggesting we go opposite of the herd and take advantage of what may be short-lived market highs to lock in profits that we can later use for buying when more & better opportunities present themselves. Are you suggesting that value investors must remain 100% invested or nearly so at all times ? I have the largest cash position than I have ever had. I am not contemplating placing a market sell order for every position I own monday morning, but as value investors, I think we can & should factor our overall view of the market in our decisions. In other words, I know that WHEN i find stocks to buy, I can often find a lot of them. But if I have limited funds, I cannot buy as aggressivly as I might have liked. It may well be that later in the year we have a number of situations driven by tax loss selling or whatever that create buying opportunities. If I was fully invested, I would not have cash available to take advantage of those buys. I am not suggesting that I or anyone can perfectly time the markets, but we can zig when the majority are zagging. We can sell when the insiders are and buy when they are buying. I view both as extra wind at my back. Alternatively, If I am fully invested at all times, and come Nov. the market is down significantly and there are a number of stocks i like, I would be in a position of HAVING to sell an undervalued stock during a period of market weakness in order to buy another. I appreciate your comments despite the fact that they surprise me and we disagree.