This is really a continuation of the thread "Sit on Your Ass" investing, but I thought this was a catchier title.Before I begin...I used to go for a 1/2 hour walk each morning and think about investing topics. I especially like the cool, but comfortable air in the early summer mornings. After giving these up, I found I had a bigger stomach and fewer good ideas...well, today I started walking again and I thought about "Cat and Mouse Investing"Have you ever watched the actions of a mouse as it is being chased by a cat? Usually the cat isn't especially hungry and is more interested in the sport of chasing the mouse. But the mouse exhibits some truly irrational behavior.A cat will normally only chase the mouse when it is running and sit and stare when the mouse sits still. Soon the mouse figures this out and sits quietly right in front of the cat's nose hoping the cat will tire of the game and go away. Eventually the cat tires of the lack of inactivity and starts to toss the mouse in the air. Does the mouse respond by running away? No, it will usually just lay there again. After all, a running mouse gets chased. Eventually, the cat tires of the game and eats the mouse.Sometimes in the early stages, the mouse runs to a safe haven. The cat will lay there patiently until the mouse decides not running doesn't make the cat go away. So it tries to outrun the cat. The cat, thinking this is great fun, will chase the mouse a few times to another safe haven. And wait patiently again until the mouse runs again. Eventually, the mouse becomes cornered and becomes like the first mouse who just sits still waiting to get eaten.What does this have to do with investing?Many people will sit on their ass when they are in a bad stock because they fear getting out of it. What if the stock goes up? What if what they buy after they sell the bad stock goes down? People rationalize all sorts of reasons for sitting in front of the cat's nose.After finding a safe haven, many people don't just sit in it while the cat waits patiently. If nothing seems to be happening to the price even while intrinsic value is moving up, they will chance a run in front of the cat instead of waiting in their safe haven.Sit on your ass investing is fine if you are sitting in the safe haven and not in front of the cat.BTW, this does not apply to Berkshire Investors. I read where the average holding period of YHOO stock is 4 days and BRK is 180 months. Do you think I should take longer walks?
<BTW, this does not apply to Berkshire Investors. I read where the average holding period of YHOO stock is 4 days and BRK is 180 months.>This is interesting. Where did you find that the average holding period for BRK is 180 months?
It may have been in a passworded portion. Try www.tilsonfunds.com
There is a cat parable Buffett likes to tell that illustrates much the same point and he tells it a an investing metaphor.It goes: I owned a cat once that sat on a hot stove. It got off instantly and never sat on a hot stove again. Of course it never sat on a cold one again either.Maybe the point is don't over-read into a lesson or take it where it doesn't really go.Jay
Do you think I should take longer walks? =====================Yes.I enjoyed your analogy. If you do decide take longer walks, I will look forward to your future posts and the different perspective you will offer. My only caution to you is to look both ways before crossing intersections, always wear light-reflecting clothing, and beware of motorists that are approaching from behind. These folks may be on the phone, tuning their radios in, messing with the kids in the back seat, or just plain reckless and inept. (I am sure they won't be covered by GEICO.) I just don't want you to wind up like Stephen King.(And now, back to lurking....)exilion
Well, maybe you should take quicker walks--bringing you to the [end]point a little soooner! (And there's the aerobic benefit.)
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