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

To: Chuzzlewit who wrote (3567)	3/21/1998 4:26:00 PM
From: Paul Senior	Read Replies (1) \| Respond to of 78592

Not sure if I agree or disagree. For me there are no easy answers. Yes if one invested in Microsoft or Dell or Lucent one could maybe beat Buffett. But who actually has done this investing? And for 15 years? Dell wasn't around, nor Lucent, nor Microsoft. Which meant a person would have had to continually readjust portfolio. Consciously select these winning type stocks from a whole host of potential candidates. If it was so easy to beat Buffett, where are all these billionaire success stories? Regarding beating pros. We need a definition of stocking picking pros. I don't see expenses as that relevant. 23 percent for Beardstown, top pros at 20 before expenses, maybe 17-19 after. If we're talking about people forced to by their business model (fund requirements) to be small cap stock pickers -- yes these guys are getting creamed by the market which now favors large caps. If we're talking large cap - take the Davis brothers - generally reputed to have an outstanding long term record. Percentage wise not as good as the Beardstown numbers (before their adjustment). Pick value funds - Tweedy Brown - again, maybe among the best long term records - not as good as Beardstowners. It's fashionable now for mutual funds not to keep cash. But 15-20 years ago, in down markets - you had to have cash IMO. That hurts fund percentage performance when looking back, but at the time it was a very reasonable thing to do (hold cash in down markets). The Beardstowners didn't have to hold cash. Maybe it's easy for some individuals to make 20% on money every year for 15 or 20 years - but it's durn hard for most people -- especially people who maintain real portfolios (that is, don't have 10K shares of SUNW because they worked there, and just don't hold only KO because Warren likes it, and don't have just have 3 or 4 types of stock, and don't use margin, and don't just run dinky amounts of money.) It's about making 17-19 percent over the long run with real amounts of money, and I don't and didn't believe the Beardstown people could do this for 15 years - esp. oh-so-easily - when it's so tough for pros. Paul Senior

To: Chuzzlewit who wrote (3567)	3/22/1998 1:28:00 AM
From: jeffbas	Read Replies (1) \| Respond to of 78592

I agree that trying to time the market is usually unproductive. But how about trying to outguess the market? For example, the market is now saying that most semiconductor, semiequipment and oil drilling stocks are horrible investments - and they have been for the last 6 months or so. Would you consider it trying to outguess the market (bad) to be looking at them? I offhand think that looking at out of favor groups is what value investing is often all about. Do you have a favorite or two in the oil services sector?