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I've owned ANZ about 2.5 years. Straight after I bought they dropped about 30%. An exit strategy on that short a time frame would have taken me out at a loss. Because I didn't sell I am up about 80% on my ANZs and as long as they keep showing a general uptrend it's all free money from here. Doesn't mean I take my eye off the ball, just means "ride the bumps".

There's a lot in what you say. My only problem with this approach is that some companies in some sectors, will never return to their former high's. For example, some of the US companies during this last bubble reached absolutely insane high's - and I'm not talking about the dot bombs. Many companies traded at p/e's of 800 or more - Rambus, the company I used for an option example reached $US400 per share post split - it's now trading at $US6.22. It is a fundamentally innovative, sound company but it will never return to it's former glory. During any bubble some sectors crash never to return and during a new bull other sectors will emerge to soak up investors money.
This doesn't necessarily apply to the Oz market because it never went through an insane period. However, look at MYOB - this company issued at $1 which then climbed to over $20 - after the introduction of GST it crashed to around 60 cents - I can't see this company ever returning to its former highs. If you bought high and are hoping for it to return to its former high you will probably have to wait a long, long time.
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