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Strategies & Market Trends : Bob Brinker: Market Savant & Radio Host -- Ignore unavailable to you. Want to Upgrade?

To: Tony Viola who wrote (8607)	11/7/1998 12:21:00 AM
From: Dr. Anthony Keyodo	Read Replies (1) \| Respond to of 42834

RE:" He should stick with what got him to where is now, which is overall market calls." Tony, Don't you agree that 96% of his advice is "sticking" to what Bob does best? I am trying to make the best of the situation. When UTEK hit the sixteens I doubled my position and 32 days later I will attempt to lock in my only tax loss of the season. T.

To: Tony Viola who wrote (8607)	11/9/1998 3:51:00 PM
From: Math Junkie	Read Replies (2) \| Respond to of 42834

Re: <<He should stick with what got him to where is now, which is overall market calls.>> What got him to where he is now is his record over the past ten years, most of which you seem to want to ignore, as far as individual stock picks are concerned. You also say that you have been listening for the last two-and-a-half years. Where were you when he suggested dollar-cost-averaging into AMAT a few months ago? That is a strategy which would have paid off handsomely by now. I believe he made that same recommendation with regard to the other large-cap semiconductor equipment names as well. It is true that he failed to anticipate the last downturn in the sector, but so did nearly everyone else. The semiconductor equipment sector is notoriously difficult to time. Does that mean that no one should talk about it or make recommendations about it? The trouble with that is, if you average out the wild swings in valuation, the sector grows at a rate well above the market as a whole. He has said many times that people who want above-average returns have to take above-average risk. This risk is not just an academic concept. In you invest in these kinds of stocks for long enough, you will have unpleasant surprises, and if you get get scared out at the bottom, you will lose real money. All these companies will turn around. If you can't tolerate the volatility until they do, that is why he recommends controlling individual stock risk by limiting the amount to 4% of the portfolio. Furthermore, if you have been listening for all this time, then you also know that he has pointed out many times the folly of paying the absurd valuations of stocks like Coke and the Internet companies. I have to think that such advice is equally valuable, if not more so, than any positive recommendations he may make. Saying that a person's individual stock picks either have to be perfect, or he has to keep quiet about them, is absurd.