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Technology Stocks : PSFT - Fiscal 1998 - Discussion for the next year -- Ignore unavailable to you. Want to Upgrade?

To: Chuzzlewit who wrote (358)	3/30/1998 7:52:00 PM
From: Don S.Boller	Respond to of 4509

Paul: HAVE ADVOCATED THIS APPROACH ON "Let's make REAL MONEY. It is very sound, especially with new technologies. (for example satellites, competing software groups, bio-research sub-specialties, etc.) The trick is to give the group enough time so that the "real" gorilla makes his/her presence known. Seems to me you need from 2 to 5 "potentials. In the beginning put about 10% (for 5) in each one....give group at least 6 months - if market will co-op. Then bet another 10% on the top-performing three...wait another 6 months then sell the bottom 2 and add that money to top three equally....after another 6 months or so, sell # three and put ALL the money equally on the two (or ONE if it has demonstrated obvious superiority AND CONSISTANCY!!) Not trading, but IF you can pick an emerging group - will make the PATIENCE all WORTHWHILE. best, Don

To: Chuzzlewit who wrote (358)	3/30/1998 9:25:00 PM
From: Melissa McAuliffe	Respond to of 4509

Isn't that coincidental. I had recently ordered this book and received it on Saturday. The only problem is the I received the audiocassette version and am not sure if I should send that back and get the hardcopy. There is a thread here on SI that was started to discuss this book if you are interested. Melissa

To: Chuzzlewit who wrote (358)	3/30/1998 9:54:00 PM
From: Rick	Read Replies (1) \| Respond to of 4509

The thesis sounds pretty suspicious to me. A simplistic plan and a compelling, adrenaline inducing slogan/book title (Gorilla this or that, Power Investing, bla bla bla) all underpinned by the questionable implication that the strategy would have resulted in timely investing in Microsoft and Cisco had it been employed. Great for selling books and infomercials, questionable for investing in stocks. My off the cuff reaction: 1) Why not just put your money in mutual funds and watch all market segments until the Gorilla's emerge, then place the investment bets. It seems to me that this approach would eliminate the need to identify "market segments that are likely to dominated by a Gorilla". In doing so, you haven't needlessly tied up your money in a market segment that might not ultimately be dominated by a Gorilla. Why should I believe that the diluted investment in the market segment while waiting for the Gorilla to emerge will beat the returns of a well chosen mutual fund ? 2) I can almost buy this approach if you're talking about a couple of players battling for supremacy, but a diluted bet accross lots of companies does not seem wise. How often are you indifferent to an investment in 5 or so different players in a market segment ? If you don't trust yourself to make an investment choice among 5 individual stocks, then you're probably better off in mutual funds. 3) If you are smart enough to identify market segments "that are likely to dominated by a Gorilla", I would assume that you are smart enough to wait until the Gorilla emerges from the rest of the chimps and then place your investment bet. 4) It may seem compelling to look back at the history of Microsoft and Cisco (probably the two most dramatic success stories in the 90's) and contrive a strategy today that would have made lot's of money, but it is far from certain how this strategy might have been executed in a real world. 5) How does this strategy account for diversified companies ? Microsoft is operating system, network, desktop application, database,etc.; Oracle is database and apps; What do I do when GE is battling company xyz in MRI machines ? The bottom line on Microsoft and Cisco is that each was a fabulously managed company that was skilled at identifying and exploiting market opportunity. If you can identify companies that are well managed, exist in an industry with good growth opportunities, have demonstrated an ability to execute a plan, have shown flexibility in the face of a competitive market, then your investments will do well. No disrespect intended, but it sounds like alot of "bunk" to me. In fact, Paul, I am a little surprised that you are placing some credibility in this investing recipe. Up to this point your approach has seemed pretty level-headed. Now I am beginning to wonder whether might be serious about having been converted to a market timer. Now, in addition to figuring out the optimal market timing, you have added another trick to your reportoire: identifying industries that are likely to be dominated by a Gorilla. Is there anything else going on in your life that we should know ? drinking binge ?, experimenting with crack ? body piercing ? In fact, the next industry that you identify as likely to be dominated by a Gorilla, let me know. I will place my bet with the MLG (most likely Gorilla) and you dilute yours accross the group and we will track returns. return to your investing roots, Rick. P.S. With respect to business process software, I have no clear idea whether it is likely to be dominated by a single Gorilla (probably not, though). However, I do have an opinion about which companies among Peoplesoft, SAP, Baan, and Oracle has the best growth potential over the next year. Do I need to tell you which ?

To: Chuzzlewit who wrote (358)	3/31/1998 2:41:00 AM
From: GW	Read Replies (1) \| Respond to of 4509

PSFT is a great investment. I prefer staying long than trading in and out. Why hassle with all the paper work and accounting of trading and paying hefty capital gain tax. PSFT has moved up nicely from the mid $20s. Sure their will be some dips but PSFT is a great company with great products AND GOOD HISTORICAL POSITIVE GROWTH like INTEL, CISCO, ORCL, ABBOTT, ATT, CADE and many other great companies. So buy on dips and stay long on great companies like Warren Buffet and Peter Lynch does.

To: Chuzzlewit who wrote (358)	3/31/1998 10:28:00 AM
From: Tom Smith	Read Replies (1) \| Respond to of 4509

OK, pop quiz. Question #1: Which of the following companies qualified for investment two years ago as a potential "gorilla" in its market segment? a) Boston Chicken b) Komag c) Netscape d) Petsmart e) Seagate f) Sybase g) All of the above h) None of the above Answer: (g) All of the above Question #2: Which of these investments would have returned a profit as of today? Answer: (h) None of the above Question #3: What would be your total return over the last two years if you had invested an equal amount in each of these companies? Answer: 46% loss Question #4: Which of the following companies had a strong "gorilla" potential 10 years ago? a) Apple Computer b) IBM c) Novell d) All of the above Answer: (d) All of the above It ain't as easy as it looks. Tom