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

To: E_K_S who wrote (32759)	11/13/2008 4:50:36 PM
From: Paul Senior	Read Replies (1) \| Respond to of 78659

"Lots of good buys this AM but I was a little timid" Ditto for me. Like you, I keep rejiggering my portfolio. Always though, I want to be fully invested. Kind of scary when I see that guys like Grommit are moving to cash or equivalent. He might be very right. The people who run our country (USA) may really have screwed it up so badly with the permitted financial shenanigans that this time it really is different - and we may not recover for years, if ever (in my lifetime). ========== ========== Whether there's a year-end rally or not, I do not know. I suspect not. As for people selling for tax-losses, I'm of the opinion that's already occurred. People have taken enough losses that they don't have to sell more for taxes, and they won't want or need to play the game of selling year-end to buy back 31 days later into new year.

To: E_K_S who wrote (32759)	11/13/2008 5:35:27 PM
From: Jurgis Bekepuris	Read Replies (1) \| Respond to of 78659

Would you want to elaborate on DD? I held it but decided to sell it. It has some OK businesses and some really crappy businesses. The problem is that crappy businesses will drag the results of good businesses down in every kind of market. Net margin is about ~10% which is OK for this kind of company, but overall not very impressive. Morningstar claims that it has zero moat - probably true for its lousy businesses. Someone (Morningstar again?) claims that "DuPont has failed to earn its cost of capital in each of the last five years". ROE is 27%, but ROIC is only 17%. Even with current low price, the company does not offer exciting return looking forward. E.g. you could expect better return from PEP, MSFT, NKE, CSCO, WYE, which are all companies with huge moats. (PEP is overall probably one of the biggest moat companies in existence). So why would you buy DD instead of any of the above? ;) And I am not even comparing DD with really cheap, but perhaps more problematic companies.