Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Graham and Doddsville -- Value Investing In The New Era -- Ignore unavailable to you. Want to Upgrade?

To: Boyd Hinds who wrote (1256)	2/13/1999 10:16:00 PM
From: porcupine --''''>	Read Replies (1) \| Respond to of 1722

"I would rather do my digging in the unexplored regions of the micro cap universe. It's more interesting to me." It's more interesting to me as well. "I like to have both value and growth in my stocks. I don't pick very many, and for my money, the best reward to risk ratio lies in the smaller end of the stock market right now." With large caps that have low double-digit forward annual growth (if that) commanding p/e's of 30 or 40, and the Russell 2000 lagging way behind the S&P 500, it seems obvious to me that there is more relative value the further down the market cap scale you go. But, separating the merely underperforming from the truly undervalued is the problem. There is so much more information about large caps. And, small caps have a way of suddenly losing their way -- seemingly without warning. And, when they do, they're down 40% in the first half hour after the news gets out. Large caps lose their way too -- as well I know from Boeing. But, 2 things are significantly different. With Boeing, there has been plenty of time for investors who were so inclined to bail out without losing their shirt. And, with a company of Boeing's size and importance, sooner or later, the company will eventually be made to straighten out and fly right. "If my micro-cap orientation is out of place here, or you don't find my postings helpful in furthering your discussions, let me know." The orientation that counts here is orientation to underlying fundamentals like earnings and assets. I, for one, am hoping to learn something useful from your investigations. What I am particularly interested in is how you can develop any great confidence that these companies will not lose their way or, if they do, that they will necessarily find their way back, or, if not, you can get out without taking a drubbing.