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Investing Books / Gorilla Game, The


Subject:  Re: Some thoughts on the book Date:  5/15/2000  1:17 AM
Author:  mishedlo Number:  2457 of 8788

By the nature of the game changing, I meant on when to buy.

The strategy I like right now is to pick strong companies that already have earnings, that have patent protection, a lock or likely lock on a huge market, open/proprietary architecture, where a tornado is PROBABLE sometime in the future, instead of already sighted.

On a risk/reward basis - depending upon the value of one's portfolio and ones goals, it may just be better to invest ahead of the tornado.

RMBS was not in a tornado in January
ELON was not in a tornado in January
etc. etc.

I believe that Rambus is in a tornado now, although I suppose for it to be official we need to see the next earnings. Of course many things can happen by then:
there could be problems, lawsuit disaster with Hitachi, but the same could be said of GMST if Time Warner situation does not resolve itself properly.

In fact many many things can go wrong with about anything, but as INTEL has shown - the market will grant much more leeway with errors in a more mature Gorilla. That said, in this bear market, would a negative CSCO surprise have been taken lightly? I think not.

From a SAFETY standpoint, one would not invest in Rambus until after the Hitachi thing is settled (or at least until the ROT hearing in June), and until the next quarters earnings. RMBS might be back to 400 by then OR it might be at 80. The worst time to buy was after a huge runup, yet ahead of the tornado sighting.

Thus: maybe a good strategy is to be reasonably early, ahead of major runups, or be patient for the tornado, BUT NOT TO GET CAUGHT IN NO MAN's land, like RMBS at 400 or ELON at 88.

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