Buy & Hold

Re: Buy & Hold

Postby millionairemind » Sat Aug 21, 2010 6:32 am

winston wrote:I then left the discussion as that but not before I politely asked them, to also read the books on George Soros eg. "Buy First, Investigate Later".


Thanks W! At 128pages long, looks like I got a new book to read over the weekend :)

Interesting that you changed the thread to BUY AND HOMEWORK. :D
"If a speculator is correct half of the time, he is hitting a good average. Even being right 3 or 4 times out of 10 should yield a person a fortune if he has the sense to cut his losses quickly on the ventures where he has been wrong" - Bernard Baruch

Disclaimer - The author may at times own some of the stocks mentioned in this forum. All discussions are NOT to be construed as buy/sell recommendations. Readers are advised to do their own research and analysis.
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Re: Buy & Monitor

Postby kennynah » Sat Aug 21, 2010 1:28 pm

alright man W !!

"Buy and Monitor" 8-)
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Re: Buy & Monitor

Postby winston » Thu Sep 02, 2010 8:14 am

Three rules on when to hold and when to sell

Stock selection can be confusing at times. Investors must decide when to hold and when to take profit.

If you are holding on to some of my selections such as Trinity (0891), Le Saunda (0738), Ajisen (0538), Dongfang Electric (1072) and AviChina (2357), you can sleep well on a big cushion of unrealized profit.

But you won't be happy if you had not sold Foxconn (2038) or China Corn Oil (1006) for a 20 percent profit as those shares have fallen to the same level as when I recommended them. I have three rules for wealth protection.

First, if I bought an undervalued stock with earnings growth potential, I would sell if it fell more than 20 percent from my purchase price to preserve my purchasing power.

Second, if the stock exceeded my purchase price, I would try to let the profit run as far as possible. But if it fell back to my break-even price after rising more than 20 percent, I would sell it, incurring no loss.

Third, if the stock kept rising, I would consider selling half my holdings when it jumped 100 percent. I would only sell the rest if the stock became overvalued or its fundamentals turned bad.

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Re: Buy & Monitor

Postby winston » Mon Oct 25, 2010 8:36 pm

We're "All In" Still and Sitting Tight By Dr. Steve Sjuggerud
Monday, October 25, 2010

After spending many years in Wall Street, and after making and losing millions of dollars, I want to tell you this: It was never my thinking that made the big money for me. It always was my sitting. Men who can both be right and sit tight are uncommon.
– Legendary Speculator Jesse Livermore,
from the classic 1923 book Reminiscences of a Stock Operator

( Winston: If I've not mistaken, when Jesse Livermore said sit tight, he meant not taking a position. I dont think he meant buying and sitting on a position. Anybody care to comment ? )

If you saw a serious flaw in Tiger Woods' putting technique, would you tell him? If you seriously thought you could help Derek Jeter hit an inside fastball better, would you tell him?

I did exactly that, in my world…

Rick Rule is a Tiger Woods or Derek Jeter when it comes to natural resources investing. He's worked incredibly hard at it… for decades. He knows natural resource investing and analyzing company balance sheets as well as anyone on the planet.

These attributes have made him an extremely wealthy man.

But I saw a flaw in his swing… Rick was happy hitting singles, when he could have been hitting many more home runs. In short, he was right about his investment ideas, but he was leaving too much money on the table.

So one day, I told him about it… I said:

Rick, I love that you manage to consistently discover and buy investments at 40 cents on the dollar or better and sell them at 80 cents on the dollar, based on what you see as their intrinsic value… But you're leaving too much money on the table…

Instead of just doubling your money, you could sometimes pick off 10 times your money. You've done all the homework, and you should reap the full rewards of your efforts. So don't cut yourself short.

Buy in at your usual big discount, and bank all your profits once you're up 100% by selling half. And then, to capture the full rewards of the 10-bagger, let it run… You can then use a trailing stop to get out of the other half of your position.

I surprised myself by saying this to Rick. But the thing about the greats like Rick is, they still want to get better.

He agreed with me, right there on the spot. Rick saw the logic immediately – the potential reward versus the risk. He's been letting his winners ride and he's been using trailing stops (when possible) ever since.

Can you change your ways like Rick? Can you shift gears, sit tight, and let a winner ride? Right now, you need to…

Now is the ultimate test… Now is the time for you to be right AND sit tight.

Don't sell your winners now for a quick profit. Now, more than ever, don't accept a single when you can hit a home run.

Why do I say "now, more than ever?" I explained the situation in True Wealth three months ago, in an issue called "A Potential Bull Market in Everything."

In that issue, I said everything could go up… a lot. I began that True Wealth issue by saying:

I know it feels scary out there right now. But… conditions are ripe for some crazy upward moves in all kinds of assets – stocks, real estate, commodities – you name it.

That call was right. Just about everything has gone up. Why all the excitement in asset prices in the last few months? I explained that three months ago in True Wealth, as well…

Unemployment is extremely high. And inflation is not a problem. As long as this situation persists, the Fed will keep interest rates near zero for a very long time.

This will create asset bubbles. Bernanke won't care… They'll just be the collateral damage of his efforts to fix the U.S. economy.

The story hasn't changed. Unemployment is still high. And inflation (by the Fed's math) is not a problem. (Far from it.)

Prices have gone up in just about everything in the last three months. These gains are simply the "collateral damage" of the Fed's effort to fix the economy. Since the fix hasn't worked yet, the Collateral Damage Trade is still on.

Assets aren't as cheap as they were a few months ago. But it's possible they could go straight up, beyond any sensible value. For investments, the story hasn't changed… It's only gotten better. Stay "all in." Sit tight. Don't cut and run.

Me? I'll just stick to what I do, which is find you safe ways to grow your wealth. And right now, I think the safest way to grow your wealth is to stick with your winners.


Source: Daily Wealth
It's all about "how much you made when you were right" & "how little you lost when you were wrong"
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Re: Buy & Monitor

Postby winston » Thu Oct 28, 2010 7:42 am

TOL:-

BUY & Monotor is a nice statement. But monitor what ?

Most FA books would say monitor the fundamentals of the companies, the macroeconomics etc ie. anything that would affect it's Revenue, Cost, Margin etc.

This is where CANSLIM may be a step ahead. In addition to monitoring the fundamentals of the business, it also monitor "Market Direction" etc.

So I'm back to the 3 things I try to look at:-
1) Valuation
2) Sentiment
3) Liquidity

And I try to limit things to 3 things else you will not be able to remember them :P
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Re: Buy & Monitor

Postby BlackCat » Thu Oct 28, 2010 9:44 pm

Assuming you're talking about when to sell after riding a long trend (e.g.: still holding from Mar 09 till now)....I'm curious about what indicators you could use for sentiment and liquidity.

And are 'interest rates' a part of 'liquidity'?
I wait until there is money lying in the corner, and all I have to do is go over there and pick it up.
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Re: Buy & Monitor

Postby winston » Thu Oct 28, 2010 9:56 pm

BlackCat wrote:1) I'm curious about what indicators you could use for sentiment and liquidity.
2) And are 'interest rates' a part of 'liquidity'?


1) There's a "Market Sentiment" thread in the forum. They monitor the ratio of bullish and bearish newsletters. Last week, somebody even monitor the number of positive and negative comments on Twitter. I personally observe the bullish and bearish comments in the forums and on CNBC :D

2) Yes, I would say that interest rates affects liquidity in the system. Anything that affects the flow of money into Equities would need to be observed.
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Re: Buy & Monitor

Postby kennynah » Fri Oct 29, 2010 1:19 pm

toss a coin.... no need so complicated.... :lol:
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Re: Buy & Monitor

Postby Musicwhiz » Fri Oct 29, 2010 2:04 pm

I know this is OT, but it would be nice if members of Invest Ideas could give their own personal views and analysis on individual companies.

I've noticed that most of the news and updates for each listed company is usually from news reports or brokerage snippets.

No offense, just my 2-cents. :D
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Re: Buy & Monitor

Postby kennynah » Fri Oct 29, 2010 2:09 pm

that's the way it is here.... i am not so qualified as to tear apart companies and dissect their operations, whether the ceo has a mistress, likes fast cars and tequilla shots, etc....

i look at charts and that's enuf for me mostly...

so, i'm sorry, i'm not adding to your "knowledge" on investing in this forum.... 8-)
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