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Hey KitKat,

I think this is a hugely important question you are bringing up. I was struck by the two choices that you put in the poll

"Keep losses to a minimum and stay away from volatile names
Buy the story and the potential for giant moves"

and I wonder if perhaps you are thinking about it in a way that makes it hard for you to invest in well performing companies that aren't "cheap". I'm not sure I can do the myriad of intricacies justice in my post so a couple of disjointed thoughts.

1) There is a volatile stock vs a volatile company. I don't mind buying amazon because I am confident they will still be around in 10 years. However buying a biotech company with one product that needs to pass through the FDA, that is another story.

2) I'm willing to pay for a company that has proven itself and continues to prove itself. CMG comes to mind. I bought them after the huge pull back from 450 to 240 because they are good at what they do. Maybe 450 was too exuberant...i certainly didn't want to invest in them then. Maybe 240 will be expensive. But they certainly have executed in the past.

3) I always like this quote, "It's far better to buy a wonderful company at a fair price than a fair company at a wonderful price"

4) My other final thought is, the most I can lose on a stock is 100% (as long as I am not leveraged) the most I can gain on a stock...well, is a lot. That has kept me invested in netflix and a few others over the years.

p.s. I have always enjoyed your posts.

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