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

To: E_K_S who wrote (48251)	6/4/2012 8:25:04 PM
From: Mattyice	2 Recommendations Respond to of 78462

EK$, I really appreciate this post. I look to this value bored over the last several years to the psychology just as much as value plays. IMO i believe you can not replicate experience, and in the end it comes down to gut decisions to each individual. I can actually see as someone like you as they get older the turnover rate increase. Its like i read soros say one time that he often changes positions because his back was hurting..... All the information in the world but changes a several billion dollar hedge fund position because his back was hurting. It kind of goes to the 10,000 hour rule that i read about from Malcolm Gladwell. You are in the prime of your investing. Especially in such a volatile fear driven market. You have done something over and over and are able to thin slice your investment decisions. Its like Paul Senior probably not even have to barely look at financials.... You know when something drops below its intrinsic value and also when it realizes value. You also understand the dynamics of when things get really out of favor psychologically. Truly an art really...... One more thing, its one thing i dont have quit YET. I look for value then i attack it, i am first to admit that i use numbers as part of the occasion, but when its over i am done with it and move one on long side and short side. I think it is remarkable how you very select value guys can keep a mental Rolodex of stocks and their store of value over decades and come back to it.

To: E_K_S who wrote (48251)	6/5/2012 10:40:29 PM
From: Sergio H	3 Recommendations Respond to of 78462

<What rule or rules have you used other than spreading out your buys over time to build up your value stock inventory w/o giving back too much to Mr. Market?> Here's my basic rules. 1. Define your portfolio goal. My first and most important goal is not to beat a benchmark but to make a consistent profit. If the general market is trending up, then my goal is to be in line with the general market but I don't care to be losing less than a benchmark measure. I need to make a profit even when the stock market is declining. 2. Define your portfolio strategy. My strategy is to go with the flow. I look at individual stocks as fish swimming in the river. They tend to swim along in the same direction as the river flows. Some might be bigger and some some might be faster but they're generally going in the same direction. I compare rivers to sectors. Some rivers are calm and some are wild and volatile. 3. The portfolio has a strategy and a goal. Manage it as one unit working together. I continuously review my portfolio to ensure that it is meeting my goal. * If the portfolio performance is meeting my goal, I leave it alone. I don't take profits and I don't sell losers, but I keep myself aware of how each stock in the portfolio is performing within its sector and relative to the general market so I am ready when I need to make a change. *If the porfolio is underperforming, I look at the general market trend. In an uptrending market I will sell stocks with major gains and review stocks underperforming individually as to why they underperformed and decide if I want to hold or sell. I will add value stocks that have lagged the general market. Undervalued stocks are more likely to find favor in an uptrending market. If the folio is not profitable and the market is in a downtrend, I will sell stocks hitting new lows and replace them with stocks that are in a better trend, but in no particular hurry. I don't want to be fully invested and I don't need to own stocks that are out favor when the general market is out favor. I don't want any one stock to tip my entire portfolio so I buy almost equal dollar amounts of each stock and once in a while add trading shares. For performance, I use 90 days or 200 days for my review depending on the severity of the general market trend and I review all of my holdings continuously as time and patience allows.

To: E_K_S who wrote (48251)	6/6/2012 3:06:47 PM
From: Spekulatius	Read Replies (1) \| Respond to of 78462

re Re:>> Value Stocks sold w/ the intention to Buy back at even a "better" value.<< OK, you are betting on further decline and that cheap stocks can get cheaper (they always can). If you are right, then great, but what do you do if you are wrong and the stocks turn up? Buy back the shares that you sold (at a loss maybe) at higher prices? Wait and hope that you are right in the end and your macro call turns out OK? Some of my biggest mistakes are selling at/near lows (when charts and macro news seem hopeless) or even more often selling too early into a recovery.