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

To: Paul Senior who wrote (6646)	4/9/1999 4:26:00 AM
From: Walter in HK	Read Replies (1) \| Respond to of 78576

Strange way to invest ?- maybe... First, that GE order at 53 was placed 3 ? years ago, I just had not revised it. Should pay more attention. Secondly, I am travelling some, may not be, and may not feel like, watching the market ALL the time. Would feel lousy if I found out afterwards what I missed ! Like October. The ‘98 and ‘87 breaks were very short, easy to miss. Gosh, in October so many came down 45 % from their High !! Briefly. Thirdly, I would only pick the creme -de-la-creme of my stocks, not the ones I actually should get rid of or the so-so's. Besides, I have to reckon with the possibility of the market breaking big-time and there has to be enough money in the account to execute all the orders, possibly on the same day. You know as well as I do: you can never tell when the break ends ! You fret on the way down and then you say: Shucks I missed it - unless you are very lucky. Admit it ! So, why not pre-determine at what price you would like to own more of your favorite stock ? Isn't it hard enough to FIND good value ?? Why are having this BB, pray tell ! Suppose it reaches that price and then turn around. You would be happy, right ? So what if it goes lower ? If you still have cash, buy more. If not, go over the dogs and get rid of them. I have those. Don't you ? A welcome event, to be forced by an irresistible opportunity. I have done well with this sort of thinking. I don't think it takes a lot of guts. Just Reality thinking an a little Comman Sense and patience. Only partly a propos: I used to watch my college trust on Saturday morning, putting the Friday close into a spreadsheet and have it spit out how many years were unfunded, of the 20 years I had promised 5 kids. Finally, zero years unfunded. OK. Joy. But soon I was down two years again. Shucks. So, the next time the fund reached it's goal, I got brave and wrote a letter to my broker listing all the stocks, number of shares and set a price, in each case: Friday's close + 15 %. I was lucky, it took 6 or 7 month, but it all was sold, on Automatic Pilot. Mail comes from the broker, reporting execution. As planned. Money left over, in the end. Paid for half of Stanford Med School of the last, lucky kid.. Why is it so difficult - for a Value Investor ! - to determine the value at which you want to BUY or SELL ??? Would you agree with Buffett that you can't really time the market ? What if it stays down ? I am a hardy one ! If I am convinced the company is terrific, I stick it out. Mind you, sometimes out of laziness. Take Magna Intl, an auto parts maker. Won't bore you, why terrific. Bought it before the ‘87 break (but ‘87 Hi=33), 1 000 at $18. went to $ 2 !! Too lazy to buy on way up. Was 110, now 85. Still 15 % p.a plus Dividends. Yeah, another Buy-order candidate. @ $ 60. Patience. It is fun to debate this kind of question .. Tell me if I convinced you, a little. If not at all, we just have different styles. I have coined various sayings, one being: “There are 17 ways to be successful” ........... (17 = many) Walter in HK PS Can you believe I have become a Momentum Investor ! Bought 10 000 of LCA Vision LCAV at $ 4 and in two days it's $ 5. But I did a lot of studying to find out why momentum exists, almost like an Internet stock. In short hand: Laser Vision Correction is booming with the Boomers because word-of-mouth advertising has reached a critical mass. The Centers are going past the break-even point. Tons of gravy on the second 100 procedures per month, once the Overhead is absorbed by the first 100. Capacity : 600 / month. VISX gets $ 250 per eye. 580 lasers in the US , 70 % VISX. The arithmetic is staggering. Do you think that is worth a separate post here ? The amount of work to come to a conclusion was no less than for a Value DD !

To: Paul Senior who wrote (6646)	4/9/1999 5:22:00 AM
From: Walter in HK	Respond to of 78576

Strange ways .. - more Just read a post on the SI SUNW thread, a guy listening to companysleuth.com and a bunch of broker reports. I never pay much attention, I think one should form one's own judgement. Sometimes there are tidbits there, but that's all. As a result, I must admit though, I usually buy too early. Typical case I can think of, when things weren't picked over as they are now. There was the old US Filter, I tripped across, reading Value Line. $ 27 cash per share, profits going up 15 % each year for the last 5 years. Cost ? $ 16 1/2. Cash at a discount !! Greedy me, put in an order for 500 at $ 15, saying to myself: Buy more at 12. Missed that, bought another 500 at $ 11.50. Was low on cash. So, my average was $ 13 1/4. Bought cash for 50 cents on the dollar. Well, at $ 27 Value Line comes around and recommends it as a Special !! 7 Months after I bought it, Ashland Oil offers $ 33 to all, takes it over. I found out afterwards why it was cheap: The Chairman wanted to do an LBO, wasn't touting it on Wall Street. Wall Street is basically a herd. Use your own head. So, you see, I read the basic information, I make my own price and I don't listen to the guys that basically sell entertainment. If they knew anything, they would be sunning themselves on their Yacht on the Riviera. Here a sample from the SI SUNW post: >> ..been touting SUNW for many months .......and have consistently maintained "strong buy" recommendations and .......have ROUTINELY REVISED their targets upwards<< etc etc etc Well, either you buy or you don't. So, what's so strange about determining the value yourself and acting upon it ? Walter in HK