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

To: David who wrote (22487)	11/11/2005 12:54:02 PM
From: Paul Senior	Respond to of 78581

DAVID, MLS story. I may have mentioned it here beginning in 1998: Message 6522215 At some point there was a discussion between Jim Clarke (a key poster here, esteemed by many, who went on to manage a small-cap mutual fund) and me about these mall picks. If I recall he liked Chelsea and/or maybe another. His pick always seemed to do better than mine as regards stock rise. In the thread's discussion about Buffett and "his" discount-mall buys, it was the opinion of posters that it was not Buffett who bought, but one of his surrogates. I believe it was said that this bunch of reit buys was not made by his key surrogate (Mr. Byrne maybe?), but instead were made by an analyst or analysts who worked for the man and these picks were not necessarily blessed by the guy or Mr. Buffett. I made MLS buys several times when the div. yield rose above 10%. I began making sales about last November. Shares bought in $20 range were sold near $60. My last sale was @49 made 10/31/05 after the company made the announcemnt of its earnings drop and report delay. These few shares were purchased 3/'99 under $18. I'm out of the stock; have no intention of going back in given current hullabaloo. --------- Imo, this is an example of where it's not easily or at all foreseen that a stock will do as well as it did. I assume most people bought because of the good (high) dividend yield, maybe management's ability maintain or increase dividends (looks like they did move a little from .50 to .63 per quarter from when I bought), and the possibility of a cap. gain kicker from profiting in gains they might see from mgmt's unique business model. That model evolved during the years I held the stock, and it was never clear to me it was a sure-fire bet. For me, this is an example of where holding a large diversified portfolio gives more chances for having a surprisingly successful pick. Whether or not Chelsea was or wasn't the better buy, from my perspective it is better to have been in MLS for a few shares than never to have bought MLS or Chelsea at all. Nice to have had MLS in a Mom portfolio too - the recurring dividend stream AND the slow but substantial stock rise. ------------------- For my own records, I want to now discuss an error or slip I made in my 1998 post above. And that is the use of the word "think". For many years - I believe as far back as '98 - I have studiously and diligently made a concerted effort to avoid the use of the words ("I think") in ANY and EVERY of the posts I write. You will see me write guess, surmise, recall, bet - but I hope NEVER the th___ word. It's important to me because when one makes a buy, one knows or one guesses --- if one has to say "th___", then that is a buy that is going to be very dangerous. Possibly because "th___" results from a combination of study and emotional responses. Although I've never posted relating to my odd opinion here, people who've read my posts - even getting beyond the joke (or serious response-g-) - that they realized for years that I didn't "think" - my investment style here is that I want to see decent financial ratios, some history over time - basically a methodological, almost rote way of investing. The fact that one "thinks" is not, imo, related to investment success. It's not so imo, that the more one "thinks" or even the better one "thinks" about stocks, or a stock or a business, the better one's stock market performance will be. To "think" means to weigh, to ponder, to dig deep - all good things that give a false sense of security. Well, all just imo, anyway.