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Subject:  Why I'm Still Holding Onto Yahoo! Date:  11/9/2001  6:17 PM
Author:  OldIronsides Number:  13752 of 15602

This post was largely inspired by several recent Fool articles strongly suggesting that the Rule Maker portfolio managers are preparing to dump Yahoo! shares. Since it was Rule Maker articles that originally drew my attention to Yahoo! and helped to inspire my (too large, in retrospect) investment in it, I wanted to express my own contrary thoughts on the matter. (To date, Yahoo! ranks as my single biggest investing mistake.) I'm posting here, rather than on the Rule Maker discussion board, because I suppose an argument could be made that Rule Maker is a narrowly criteria-driven approach, and since Yahoo! no longer meets many of its criteria, it should be sold. Personally, I don't want to be bound by that kind of strait-jacket.

By way of background, I've only been investing in individual stocks since 1999. (Yes, my timing, as always, was impeccable.) I bought four shares of Yahoo! that year purely as an experiment. Subsequently, after Yahoo! peaked in 2000 (all-time high: $250) and began its long downhill slide, I began adding shares, starting at $117. My big mistake was buying too many shares at too high prices all the way down to my last few shares at $26. In brief, I bought way too much way too soon as I averaged down. My basis is substantially higher than the Rule Maker's. The major mistake in both cases, to my mind, was one of valuation: paying too much. I have serious doubts that I will ever profit from these shares, although that remains a remote possibility. Still, I