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Author: numb99 Three stars, 500 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 3841  
Subject: Not listening to own advise Date: 7/10/2002 3:58 PM
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Just thought I'd share my own dumb investment act.

My investments are heavily weighted in the tech sector. I was not worried about the tech downturn because I am a LTB&H and figured I could ride out any cyclical motions of the stock. When the stock was down almost 50% from the year before, I decided that I should start worrying more about diversification if one holding can weight down so much on my overall portfolio. I said that when the stock hit $X per share, I would sell some and diversify my holding, where $X was my break-even point of my dollar-cost average purchases. About a month ago, the stock started climbing again, and the company announced a split. "Great!" I thought, the tech-downturn has bottomed out and is starting to recover. The stock slowly went up, and up, and finally hit my target price. Unfortuantely, I got caught up in the trend, and thought "If it's still going up, I would do worse to diversify now." The upswing was short-lived however. The stock dropped down to where it was before (and is slightly lower now).

The lesson: Stick to your plan. Don't try to time the market.

On the plus side, I was able to sell some of that stock at the peak of the upswing to help pay for a home purchase. Also, I still believe in the company and believe in the management. I am still holding onto all of my shares, so I haven't actually lost anything, just gains I could have made if I sold at my target and re-bought at the current price. I'll just have to wait it out until the next ramp in the tech sector.

I still that target on my radar though, and will be making the appropriate changes at the next opportunity.

Fool on,
Ben
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