No. of Recommendations: 2
How do you force yourself to "start over" each time in how you look at a stock you already own? Curious how you actually do this (i.e., block out the history)!

Hi Joan,

Long time no see! :-)

In reality, I find that I cannot. I know I've purchased the thing before and that does influence my thinking about a second purchase. But what I try to do is to look at the new purchase with fresh eyes. I use my process of checking the priced-in expectations, catch up on any information that's come out since I last looked (I keep notes of each company), etc. Has anything changed to the thesis. Is it proceeding or has trouble cropped up? And so on.

If the expectations are still messed up, even if they're higher than when I first purchased, and the thesis is still intact, I'll probably buy some more.

Note, though, that this is not an automatic thing. GameStop, for instance, in my MUE port is probably not going to get a second purchase unless I see improvements in the margins (which I haven't yet, if I recall the latest earnings correctly). Similarly, Supervalu is going to remain with a single purchase. On the other hand, several have seen a second purchase and a couple of have seen a third purchase (and I have at least one more planned for that). I'm doing this to deal with what I perceive as risk. The most risky choices will stay at the single purchase (2%) level, while those that I'm most confident about and believe have the lowest risk will see 4% and 6% positions (percentages based on purchase amount, compared to original portfolio target funding).

Of course, the ones that have done the best in this port are those very risky ones. Ha! But that success doesn't mean that I'm going to put more money into them, as I still believe them to be pretty risky. That might change in the future, but not yet.

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