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

To: Paul Senior who wrote (3208)	2/12/1998 7:57:00 AM
From: judge	Respond to of 78550

great post paul. best returns j

To: Paul Senior who wrote (3208)	2/12/1998 8:25:00 AM
From: Wink	Respond to of 78550

>>if you HAVE to win, you will not. Don't know why that is, but it is --<< Your analogies about playing stocks and casino gambling ring true. As a kid I used to gamble at the race track (horses), and there the old timers used to say, "Don't bet with scared money!". This is similar to your thought about having to win. Many put themselves in a position where if they lose, they must keep on going until they win. Instead of winning though, they just throw good money after bad. I believe this to be because one starts to think irrationally when they start to lose, they don't stay within themselves and regroup, instead they "go for broke". I guess what I'm saying is that you need to have a basic plan and always come back to it if you start to get out in left field. This I believe is contrary to what you have said, but it put me through college with my track winnings. Being a novice to stocks though, I just hope that I can duplicate my good fortune, in stocks, before I retire...;>) BTW: I gave up the track when I got out of college, I was becoming too compulsive about betting.

To: Paul Senior who wrote (3208)	2/12/1998 9:49:00 AM
From: Honest Abe	Respond to of 78550

I agree - maybe not quite as passionately, but I agree. Momentum investing, small caps, the next big thing are all a lot more exciting to invest in than long term value stocks. And if you try the others first and realize they fail, or at least are a lot harder than they look, you will become more disciplined to the noble and boring attributes of true value investing. I started investing early on and tried everything but value investing, except for McDonalds - I bought it and forgot about it. After two years of trying out CANSLIM, Zacks top ranked stocks, etc., I was fortunate enough to break even - but only because of my now long term gain in McDonalds. "Copy Shamelessly" are words to live by - I saw that quote in a Business Week article one time. With millions of people trying out millions of theories on investing, why try to create your own? If it truly works well, it will continue to work well. Therefore when I see Buffett 'discover' a method of investing that beats the pants off of everyone, I will simply do my best to Copy Shamelessly. If someone else comes along and through some other method starts to beat Buffett year after year, I will most likely simply become a new student of that discipline. But, at this point, it would take many years of superior returns to convince me there is a better style in the stock market. So a Buffetologist I will remain!

To: Paul Senior who wrote (3208)	2/12/1998 10:37:00 AM
From: Ron Bower	Read Replies (1) \| Respond to of 78550

Paul, Don't knock the real estate. I bought two warehouses in the '70s that are now returning annual lease payments equal to 60% of the investment in addition to 400% value appreciation. Farm land that brings in 6% above taxes, value gain doubled in 10 years in addition to underlying mineral deposits worth 25 times purchase. IMO Real Estate is still the safest and best long term value a person can invest in. IMO - REITs have gotten full valued in the last couple of years, but it's hard to ignore the 8% dividends and value appreciation. I've always been a risk taker, but options and day trading are things I wouldn't consider. While on vacation I talked with a professional day trader that, with a dozen others like him, sits in front of a computer all day investing hundreds of thousands looking for 1/8, 1/4 gain on big caps. Trades are made instantly by computer tie to exchange. He makes over $100K a year ON COMMISSION. The layman investor can't begin to compete with an operation like this. Ron

To: Paul Senior who wrote (3208)	2/17/1998 11:24:00 PM
From: Paul Senior	Read Replies (2) \| Respond to of 78550

I'm buying and selling-- but what a lousy day today to be a buyer. Seems very difficult to get good prices. I am stepping up anyway. I've bot WES or Wescorp, a small California-based bank with a subsidiary that does sub-prime financing (yes, I have not apparently learned my lesson with this business!) as well as refi's. President has increased his ownership of the company about at current price. Stock does seem reasonably priced relative to others - (although as I've stated before, investing in "relative" bargains is no bargain at all - really very dangerous.) However, there's a reasonable increasing div., okay pe, and prospects (IMO) for growth over next fews years. I'm diversifying my banking interests here - still own all regional bank stocks I've mentioned before. It was a toss up for me to add to my small position in NB or start here. Started initial position in WES last week before recent pop in its stock. I expect stock to settle back down, but just lost patience to wait. (Got sucked into excitement of rising market --that's an oops -g-) Buying CCS which is the real estate operations of old Castle and Cook. Run by Dole's Murdock. This is basically a real estate play in two areas - although the Co is trying to diversify. Company is heavy into Hawaii land (not doing so well in selling their houses there though - market is down) and Bakersfield Calif (near to Tejon Ranch? -g-.) Stock is down in its trading range (very limited history with the stock though), mutual fund buying. Market cap below assets (I would like to believe). Added to my position in ICOC (ref. my posts here 2098 and 2876)which I bot @ 5.7/8. I like it still and better at today's buy price (for me) of 4.7/8. Lots of cash (debt too). Below book value and okay business model. Nice dividend supports stock price (-g- that's what I thought at 5.7/8. Wonder if I'll be saying that too at 3.7/8 -g-) Been selling off relatively large positions in TOY and SRM (Sensormatic). I've got to update my records, but it does seem like with my stocks, they 90% probably go UP after I sell them. Been waiting almost 3 years for SRM. Now that I've given up, it's going up. I hate that -g-. And I'm tired of riding TOY up and Down. My long time purchase of McFrugals was bought by Consolidated Stores which stock I'm still holding -- they own KB Toys. That's too many toys for me. So I've been reducing TOY holdings. Looks like I may be pitching out the wrong stock. FWIW, I've added today to my position in Flextronics (FLEXF). It's a big holding by Ron Baron (his fund). Not really a value play IMO, but a speculative buy. Anybody who follows Electronic Contract Mfging thread can follow extremely well done (IMO) detailed analyses of this and other such stocks. (Paul Klemencic, who posts occasionally here, is the moderater and Guru (in my view). This stock and others like it are really almost paradigm shifts (sorry -g-) in the way some businesses will manufacture products. It's no longer necessary or perhaps even desirable (this can be debated) for companies to sustain their own manufacturing facilities. I am reviewing my position in Exide (Ex) which I still hold. I wrote it up here about March of '97 when I bought at about 17. Now it's about 23. Starting now to see a number of mutual funds come in and take positions (but I can't figure why they're buying now). This might indicate a signal for individual investors to buy again (???). Lead pricing and plant consolidations in Europe hurt business last year. The lead pricing issues may be resolved (I'm not sure - don't follow spot/contract prices.) President's reputation also is somewhat tarnished in past dealings with analysts apparently. (That's Exide's president, not referring to OUR Pres. -g-) Also el nino has meant warm weather---not so good for battery sales. Any opinion anybody has on the battery biz or Exide, or especially, any analyses anybody has done or seen regarding buying stocks after value funds come into it -- I'd be interested in reading here or on Exide thread. Paul Senior