I have been trying to post this question on this board after the market took a nose dive. But I was not sure that the question I had in my mind make any sense and useful for others who come here to find out more information about the companys they invested.I finally decided this is the place to get the right information.Anybody looking for information about any company please click next button to skip this message.Everybody says Buy and hold works on the long term.All the articles writing about LTBH approach say the same thing.If you buy $2000 worth of Coke stock at 1970 You would .....If you contribute $100 in XYZ stock every week or every month after thirty years you would ........Since those (WMT,KO,MRK,GE..)companys are successful over a period of long time and are still ALIVE now everybody refers to the investment returns in those companys. Thirty years back,How would one know that these companys were going to be alive and as successful as they are now.But now we are living in technology world.Can we expect the same kind of success and investment return from Technology companys over a 20 year period of time that we saw in WMT,KO,GE.How would one pick up those kinds of companys in Technology sector.Balance sheets,Revenue figures,cash flow statements can only reveal the facts about how strong this company is.But it does not tell me whether it is going to exist for next 20 years or so. Let us even assume that there is no competition threat for the companys for as long as they exist(In a way as long as their customers buy their products). This is where It makes me feel worry.How long the customers can buy CISCO routers or cell phones with CDMA chips inside.How long these companys can exist on the earth.Can these technology companys survive even after thiry years.I know we can't predict the future.I feel like I am getting old quickly after entering into stock market exacly one year back. I watch the price movements everyday and wait for next quartely results and next split date.This whole action makes me feel getting old so quickly.Now I decided I should forget about all these and open a NON-MARGIN account(That is different story).I recently opened an account where I started buying 10 different stocks every month.All technology stocks.Now I am confused whether my decison to pick up the technology stocks for the long run(At least 20 years or Until I see some change in the company fundamentals) will make any sense or not.So can any body share your thoughts whether I am going in right direction or took a disaster path.
krishnarama wrote:Since those (WMT,KO,MRK,GE..)companys are successful over a period of long time......How long the customers can buy CISCO routers or cell phones with CDMA chips inside.How long these companys can exist on the earth.....Can these technology companys survive even after thiry years.I know we can't predict the future....I feel like I am getting old quickly after entering into stock market exacly one year back.....I recently opened an account where I started buying 10 different stocks every month. All technology stocks. Now I am confused whether my decison to pick up the technology stocks for the long run(At least 20 years or Until I see some change in the company fundamentals) will make any sense or not. So can any body share your thoughts whether I am going in right direction or took a disaster path.Help!!!Okay. Let's address some of the issues you present.The first thing to do, if you haven't done so, is to read The Gorilla Game which you can order from this link:http://www.amazon.com/exec/obidos/ASIN/0887309577/o/qid%3D940886352/sr%3D8-1/002-6400673-8618414Since those (WMT,KO,MRK,GE..) companys are successful over a period of long time...Successful yes. Wal-Mart has been the best of those you mention in terms of returns since it went public in 1970. Home Depot which had its IPO in the early 80's is another whopper of a performer. How do the stocks you mention compare to the 5 'best' tech stocks for the 1990's?CMGI--up 57,191% EMC--68,314% DELL--72,400% AOL--81,400%Cisco--124,825%How long the customers can buy CISCO routers or cell phones with CDMA chips inside. How long these companys can exist on the earth...As opposed to the secondary market on the moon? <ggg> Enterprise Networking is in its eleventh year of the technology adoption life cycle and customers are still buying. Routers is only one product that Cisco sells by the way. The technology adoption life cycle for CDMA technology is in the earlier stages of the cycle. The threat of a discontinuous innovation is what we are always in fear of as investors. We cannot predict exactly when they will come, but they will come. Can these technology companys survive even after thiry years. I know we can't predict the futureWell, take a look at Intel. They went public in October of 1971 at a 12 stock splits price adjusted cost of 3.9 cents a share. Apple will hit their 30th birthday party soon. They went public in 1980, but were around in the 70's as a company with the Apple II that launched a 'revolution'. I think that many of them can survive after thirty years or more.I feel like I am getting old quickly after entering into stock market exacly one year back.....In spite of the recent whiplash, if you have been in the market since last June - you should have some nice returns since then on the types of stocks we talk about here.I recently opened an account where I started buying 10 different stocks every month. Now I am confused whether my decison to pick up the technology stocks for the long run(At least 20 years or Until I see some change in the company fundamentals) will make any sense or not. So can any body share your thoughts whether I am going in right direction or took a disaster path.Promiscuity is not always the pathway to paradise. Virtue, however..... I'm not sure if I understand your strategy. Are you buying ten stocks every month, then selling them to buy a different ten the next month - or are you simply adding positions in ten new companies every month which means you would own 120 different stocks by the end of the first year? Long term buy and hold doesn't mean long term buy and hold forever. The TMF staff has done a nice job of addressing that issue. If you've read the book, you understand that 20 years of holding a stock may not be the best strategy simply for the sake of holding a company 20 years. Regardless of the fundamentals of an established gorilla, if a discontinous innovation comes along that could disrupt the technology then forget about the 20 year stuff....I think I'll stop there and wait for you to answer a couple of those questions and let us know if you've read the book or not.Tired and worn out at 1:45 AM....BB
ARMHY,CMGI,CREE,JDSU,QCOM,SEBL,ARBA,RMBS,ELON,ITWO,NTAP,RBAK,BRCM These are not shabby stocks. I found this list on your profile, krishnarama. I own CREE,QCOM,SEBL too. Hope your not margined heavy though, summer is acoming. Tinkershaw explains it best here stating a long tech unfriendly summer ahead ;http://boards.fool.com/Message.asp?id=1120020000487001&sort=postdate I can only speak for myself and I just started in February. I am not happy with everything I purchased but I do know one thing;If in doubt, WAIT! There is no HURRY, there always is another opportunity.READ, RESEARCH each industry then each company and lurk the Boards for weblinks for more information. People like Bruce Brown, Tinkershaw and the TMF Staff abound here at the Fool to help each other and are very kind with their advice. I am reading the Gorilla Game after reading Rule Breaker/Rulemaker from the Gardner brothers. I took the Rulebreaker seminar and heard Tom Gardner is giving a RuleMaker seminar this summer. I can HIGHLY recommend it to you. Feeling old? I'm 49 going on 60 after APRIL !...hehe ...but I'm Wiser in a GOOD sense.Each of us has their own risk level. LTBH and CASH ONLY is the ONLY sensible thing for beginners. David Gardner's recent article to measure your risk factor is very valid. Are you ready for a Rulebreaker or should you be in an index fund ? You may have moved too far to fast. You can find it here;http://www.fool.com/portfolios/rulebreaker/2000/rulebreaker000531.htmAll the best to you and the return of this market to the stratesphere.....Foolin on...HoF
I'm not sure if I understand your strategy. Are you buying ten stocks every month, then selling them to buy a different ten the next month - or are you simply adding positions in ten new companies every month which means you would own 120 different stocks by the end of the first year? Thank you very much for your immediate response.Hope My question did not make you feel tired.I am buying the same ten 10 stocks every month. Do not intend to sell them in near future.Keep accumulating the same ten stocks.These are the ten stocks.ARMHYCMGIQCOMJDSUBRCMNTAPARBASEBLITWORBAKSo every month I am adding same ten stocks (four or five shares in some of those companys.Sometimes I even buy one share based on the stock price).My commision charges are like three dollars for each purchase.My concern is Am I doing the right thing by Buying the shares in those companys for long time.
Krish, May I call you Krish?Bruce is probably alseep by now. He's in Austria if you didn't know.I'm sure he'll be answering you but I thought I'd throw this out. It's Bruce's list of favorite stocks.JDSU, QCOM, ITWO, BRCD, SEBL, AMGN, MSFT, INTC, YHOO, CSCO, GE, ORCL, EMC, JNPR, RBAK, SCMR, GMST Other favorite stocks that wouldn't fit above include: AMZN, BRCM, CMTN, COVD, CREE, DCLK, DELL, EBAY, ELON, FDRY, NTAP, RMBS, HDI, SCH, EGRP, ARBA, PFE, CMGI, AAPL and your list of stocks you're buying.ARMHY CMGI QCOM JDSU BRCM NTAP ARBA SEBL ITWO RBAKYou see many of the same stocks on both lists. You won't be too far wrong with what you're buying IMO.Good luck with your plans.Harry
But now we are living in technology world.Can we expect the same kind of success and investment return from Technology companys over a 20 year period of time that we saw in WMT,KO,GE.Winston Churchill said of democracy that it is the worst form of government, except for all of the others. Sometimes I think the same thing of LTBH. The first question one needs to ask is what one's strategy will be if it is not LTBH? Another issue relates to whether one is investing primarily in tax sheltered vehicles (e.g., IRAs, 401ks) or not. Clearly, one's market timing skills must be must signficantly better in a taxable account for that strategy to work.How would one pick up those kinds of companys in Technology sector.Given that this question is posted here, I assume you are already aware of the fact the entire point of the Gorilla Game strategy is to enable one to find technology companies to hold for the long term. The last "rule" of the GG is that most news is irrelevant and should be ignored. For example, the economic news of the previous week resulted in the biggest one week gain in the history of the NASDAQ. According to the last GG rule, we should learn to ignore this type of news. Although it is true that such news has nothing to do with technology adoption lifecycles, in the real world where many of us must make investment decisions on a monthly or semi-monthly basis, it is hard to ignore such news. How many people start out with $10,000 at the beginning of a technology adoption lifecycle and then, coincidentally, have more money to add after the gorilla emerges and subsequently tanks? The gorilla game case histories are not very realistic in this regard. As has been discussed recently on this board, a Gorilla Gamer has "timing" opportunities even if the only decisions are "when" and "what" to buy; i.e., even if one plans to hold current positions until a discontinous technology comes along. For example, one might have decided back in February that the market was richly valued and that one's monthly contributions to one's brokerage account should sit in cash for a while -- I did not do this, but somebody might have. Last week that same someone might have concluded that the worst was over and that it was time to invest the cash accumulated since February. Even if that someone's portfolio consisted entirely of confirmed gorillas (e.g., ORCL, INTC, CSCO), that someone would still have engaged in market timing, albeit a less risky (and, in this case, potentially less rewarding) version than one who decided to liquidate the entire portfolio at the end of February and buy it back later. Now that I write this, I am not so sure that the "big" gorillas mentioned above went down enough for one to be able to both pay ST capital gains taxes and still be able to acquire more shares at the bottom (probably yes on CSCO, but no on ORCL and INTC). Now I decided I should forget about all these and open a NON-MARGIN account(That is different story).I recently opened an account where I started buying 10 different stocks every month.All technology stocks.Now I am confused whether my decison to pick up the technology stocks for the long run(At least 20 years or Until I see some change in the company fundamentals) will make any sense or not.I am not sure the "10 stocks per month" strategy makes sense in any context. Which 10 and how are they selected? Is it your favorite 10 at that time such that many months the same 10 will be purchased? It seems like it would have to be; otherwise you would own the entire technology sector after a few years. Also, commissions will eat in to your returns unless you are contributing something like 15k per month (this assumes that one's goal is to keep commissions to 1% of one's basis -- a reasonable rule -- and a $15 commission). When do these 10 buys get sold? Each month? If not, then isn't this a LTBH strategy that focuses on the "buy" side? Anyway, you get the idea. Good luck and let us know where you come out on all this.
I'm sure he'll be answering you but I thought I'd throw this out. It's Bruce's list of favorite stocks.And I thought I was the only one who used that list to define my universe of potential purchases, though I cannot figure out why HDI is a gorilla, but Bruce listed it, so it must be one.
HDI comment was a joke, but I wish Bruce would stop listing purchases for relatives in his favorite stocks.
I am buying the same ten 10 stocks every month. Do not intend to sell them in near future.Keep accumulating the same ten stocks.These are the ten stocks.ARMHYCMGIQCOMJDSUBRCMNTAPARBASEBLITWORBAKSo every month I am adding same ten stocks (four or five shares in some of those companys.Sometimes I even buy one share based on the stock price).My commision charges are like three dollars for each purchase.Okay, that makes much more sense. In fact, this is a great strategy that I wish I had the guts to follow. I own all but ARBA, CMGI, and ARMHY and I did own ARMHY but it was a victim of pre-margin call selling. My problem is that I am not confident enough in my stock picking abilities to narrow the list to 10. My guess is that your strategy of averaging in to those 10 companies every month will do very well over the long term.How do you pay only $3 per trade?
Hi krishnarama:You wrote:Thank you very much for your immediate response.Hope My question did not make you feel tired.I am buying the same ten 10 stocks every month. Do not intend to sell them in near future.Keep accumulating the same ten stocks.These are the ten stocks.ARMHYCMGIQCOMJDSUBRCMNTAPARBASEBLITWORBAKSo every month I am adding same ten stocks (four or five shares in some of those companys.Sometimes I even buy one share based on the stock price).My commision charges are like three dollars for each purchase.My concern is Am I doing the right thing by Buying the shares in those companys for long time. I believe you are buying through BuyandHold.com, a fine service (pseudo-Drip program) that executes trades twice daily for $2.99. I have an account with them, although I don't use them very much now that I have an account with AMEX (free trades are better than $2.99!). Your plan sounds like an excellent one, you have chosen some very promising companies, but ones that will be very volatile and carry some risks attached to them. Personally I own shares in JDSU, QCOM, NTAP and RBAK.Let's look at your picks in the context of the Gorilla Game:ARMHY licenses the designs for their low power processors that can be used in wireless devices and other embedded applications. It might even be a young Gorilla, although most people would lump them in the royalty game category. They are definitely in the tornado.CMGI is an internet company incubator. a behind the scenes player, so its success depends on bringing to market successful companies. This company is NOT a GG play, although it could conceivably give birth to a gorilla.QCOM is recognized as a gorilla in the wireless data market since CDMA is thought to be the inevitable standard.JDSU is thought as the King in the market that supplies fiber optics components. It is definitly in a tornado, and IMO may has the potential to morph into a gorilla if it can establish a key component as a proprietary standard.BRCM is thought as a king/prince in the chips that enable broadband communications. Cable modems contain their chips. Intel, a confirmed gorilla covets this market.NTAP makes network storage devices competing with EMC. NTAP leads the market for the smaller storage systems NAS, while EMC leads the SAN market. Here's an instructive post on the NTAP vs EMC debate:http://boards.fool.com/Message.asp?id=1190046000606000&sort=recommendationsNTAP is definitely in a tornado and is the King of the NAS part of the market.ARBA serves as a marketplace in B2B, they are playing in the Godzilla game, trying to get the early lead and cornering the market segment.SEBL is a recognized gorilla in CRM.ITWO supplies infrastructure software for B2B, definitely Gorilla potential here, but ORCL and SEBL two confirmed gorillas covet that space.RBAK is apotential gorilla, they dominate the Subscriber mamagement system market and have a proprietary open system. Their market is definitley in the bowling alley with strong winds. Here's a summary of RBAK I posted in Rat's board:http://boards.fool.com/Message.asp?id=1380066003243001&sort=postdateIf you are comfortable with the volatility of these companies I believe that they could all be fine long term investments. Keep an eye on these companies at least quarterly to make sure that they stay on course. Dollar cost averaging into these companies is a great idea, part of my long term plan is to buy on dips/corrections some of my favorite (but more volatile) names and to add money regularly to my "safer" stocks, such as MSFT, EMC, CSCO, JNJ, PFE, AAPL. Confirmed gorillas should be less volatile and still have plenty of growth left in them. Such a list might include: MSFT, CSCO, ORCL, SEBL and INTC.LTBH doesn't mean holding forever, but it does mean holding as long as the fundamentals of your company remain intact. For the last 3 months most of the fundamentals of the companies you hold have not changed much even though their stock price has swung from one extreme to the other. Just be aware that there may be as many as 2, 3 or more companies in your list that may go bankrupt so that any money invested will be lost. The winners in your list will more than make up for any losers as anybody who invested early in a gorilla and held can attest to.You have a good plan, stick to your discipline and you should do fine.Erick(xerohype)
Perhaps I'm interpreting your post incorrectly, but I don't think you're looking for reassurance, at least not the obvious sort. After all, whatever reassurance you might receive from the members of this board would be relatively meaningless in terms of your financial health since none of them would be willing to guarantee your losses in the event that their reassurances are misguided.On the other hand, those who would encourage you to take another approach probably wouldn't be willing to make up for any profits you might miss out on by not having invested in those stocks you've chosen, or by having sold them prematurely.You're asking "how would one know" and "can one expect" and "how does one pick" and "can these companies survive". The fact is that nobody really knows, but if he's going to engage the market for the purpose of making money, he has to plot a course of action and follow it whether he really knows or not. The course of action he chooses depends only in part on what he reads and what he learns. It depends also on who he is and how he tolerates risk.If you're asking for any sort of reassurance at all, it seems to be not so much that you're following the correct path and that you've chosen the correct stocks and that you've selected the appropriate investment medium. It sounds instead as though you're seeking reassurance that the risk level you've found yourself at is appropriate for you, but regardless of how much reassurance you receive from how many people and how good that makes you feel for at least a while, the only way you can prevent that uneasiness from returning is to wrestle with the problem of risk tolerance yourself. I strongly urge you to pick up a copy of The Nature of Risk by Justin Mamis. By achieving a better understanding of risk and of your relationship to it, you'll have far more confidence in your investment decisions, and the idea of seeking reassurance from others won't even come up.
krishnarama listed holdings and wrote:ARMHYCMGIQCOMJDSUBRCMNTAPARBASEBLITWORBAKSo every month I am adding same ten stocks (four or five shares in some of those companys. Sometimes I even buy one share based on the stock price). My commision charges are like three dollars for each purchase.My concern is Am I doing the right thing by Buying the shares in those companys for long time.I've read the numerous responses to your post. None of us are professional financial consutlants and anything you read or take as 'advice' is at your own risk. That being said, we don't know your age, your goals or your risk tolerance to fit those previous two categories. You have a 100% technology portfolio which includes a basket of stocks that by historical measures, all have rich valuations. Qualcomm is your 'value' stock at the moment. <ggg> This puts your portfolio right smack in the middle of aggressvive growth. High risk, high reward would be another way of looking at it. That fits the risk profile of some while it sends a cold chill over others.You have chosen the strategy of dollar cost averaging by taking the money you save from your job and adding to your investments on a monthly basis. I like that strategy a lot and commend your efforts to apply it over the next decade or two. It is a strategy I used when I started out and I still use it to this day. Although these days, it seems to be more on a quarterly basis. It's not the only option available as a strategy, but certainly with everything I have read and studied on investing over the years - a good strategy to say the least.That being said, your ten stocks certainly looked poised to do well in the future - each for their own individual reasons. Assuming that you did your homework well on each of the investments, you understand the risks for each in terms of the gorilla game. To put them all into the context of what defines 'long time', they each have their own unique longevity profile as well.Once again. It's an aggressive growth portfolio with higher risk and the possibility of higher rewards because of it. You cannot expect all ten to be 'winners' over the long term. The possibility that a few of them will be 'winners' offers the chance to balance out the portfolio returns over the longer term. This, combined with your strategy of dollar cost averaging appears to look net positive. You already hold some confirmed gorillas. Qualcomm in CDMA technology. Siebel in CRM. i2 in SCM. The rest make up some exciting candidates in various games - be they royalty games or gorilla games.It would appear from your question of "Am I doing the right thing", it would behoove you to increase your knowledge of investing via reading some investment books, periodicals devoted to investing and study everything you can here at the Fool. Sponge it all in and know that over the years as you invest, you will adjust, alter and find strategies to help you meet your goals along the way. We all make mistakes along the way in the process. That's part of the learning.BB
And I thought I was the only one who used that list to define my universe of potential purchases, though I cannot figure out why HDI is a gorilla, but Bruce listed it, so it must be one.I'm not sure if I should laugh or cry.Nobody is here to pick stocks for you. As I'm sure you know, it's best to ignore or at least take any references for a stock with a big grain of salt. I just wanted to comment on a couple of things, even though it gets OT. I feel it's important to say - especially in light of some of the comments I just read including the above italics. Harry dug out some of my favorites and Sly made a comment about Harley. It is true that every family member under my name (including myself) owns shares in Harley Davidson. We have our own reasons, needs and goals to place any investment in our portfolios. Those should never be confused with advice or a taken as a signal that any investment I hold - as well as the conclusions I've drawn for investing in that company - meets another's goals, risk tolerance and homework. I hold stocks outside of technology and outside of gorilla games. I wouldn't even talk about HDI without presenting numbers to qualify why such a growth company resides in my portfolio. There are valid reasons. There are hundreds of investments that show up on growth investors' radar outside of technology and gorilla gaming. Since this is the board about high technology and gorilla game investing - I won't say another word about my investments outside of high technology as it simply wastes time and focused thought. I just wanted to clarify that. It would probably be best if I simply removed my favorites list if it is causing confusion or leading people on to actually pay close attention to it. However, we each feel proud of our portfolios for various reasons. It could be for the research we conducted which led us to choose the company as an investment. It could be for the returns we have had from the time we decided to invest in the companies. It could be simply an expression of presenting who you are and what you invest in which gives a little insight. However, what you don't see listed are the 'failures' I've had over the past decade or two. The success stories have certainly outweighed the failures, but I've had failures in the past and I'm sure there just might be a failure or two in my current portfolio. If I need to be reminded of opinions that differ from ine, there are hundreds of posts a day on message boards of investments that I own to signal and remind me what I consider worthy investments are headed for failure, crash and the toilet according to others. They may be just as 'right' as I am.Therefore, Sly, Harley is no gorilla. However, if you jump to the Harley board, there is - on occasion - fundamental analysis of that company. Usually around earnings report time. The rest of the time the discussion has little to do with investing.BB
I've been lurking here at the Gorilla Board for some time. I still consider myself a neophyte. I began investing two years ago, made a number of foolish (not Foolish) investment decisions which still linger in my portfolio for one reason or another. The reason I decided to get into the business of investing had to do with reading article after article about tech investing and the Internet and the staggering growth that would take place over the next 5-10 years. Tech stocks defy all historic investment philosophy and theory (at least up until the recent correction), and that growth and price in spite of "profitablility" according to traditional standards continue to skyrocket (and they will again). That suggests to me that this is a "revolution" comparable to the industrial revolution with the advent of the printing press. There was no turning back. Life changed forever. I believe that is the case with the reality of the Internet and all that it can bring to the planet. Now hear that.... to the planet. The first time in recordable history that a technology has been introduced that allows the planet to truly be a community ... an interactive community. Stores, groceries, medicine, counseling, research, resources, education, investing, mail, news, community collaberation, politics, whatever you can imagine. Everything at the the touch of a computer keyboard. The Internet is changing the way we live our lives .... most literally.How often does anyone have the opportunity to invest in a revolution that has such profound power for change. In the past a revolution has been the fuel to power change in a nation. The Internet has the power to change the way the entire world relates to one another. I guess the bottom line of MHO is that I'm not one bit worried about investing in tech stocks over the next 30 years. I'm not investing in what's going to happen in the future. I'm investing in the revolution. I'm researching and investing in companies who are seizing this revolutionary opportunity to be leaders and innovators to perpetuate and insure the progess of the revolution. I'm investing in good companies who are leading the revolution. The humdrum of investing doesn't change. I still must review and "re-research" my investments to feel secure that they still meet my investment criteria. I need to keep tabs on financials, principals, direction and leadership that will satisfy or change my focus. I think I'm one lucky camper to have started investing at this time in investment history. 20 to 30 years? I feel outrageously lucky that I started investing when I did. This kind of opportunity only comes once every 500 years or so....Good luck. Read. Research and keep asking questions.Fool and ProsperNancy
I believe you are buying through BuyandHold.com, a fine service (pseudo-Drip program) that executes trades twice daily for $2.99. I have an account with them, although I don't use them very much now that I have an account with AMEX (free trades are better than $2.99!). Erick, Would you comment on your satisfaction with AMEX. I checked them out four or so months ago and there seemed to be a lot of dissatisfaction with their website: often slow, balances not updating (especially bad in IRA accounts where you can't buy unless you have the cash, etc. Do these complaints sound familiar (or are they perhaps not an issue to you as a long term and therefore infrequent trader) OR have they been corrected. TIAgeo
Hello geo:I will give you my opinion on AMEX, but you must promise me to take the conversation to the Discount Broker board:http://boards.fool.com/Messages.asp?id=1040005000000000There's a recent thread there comparing AMEX with Datek.Erick, Would you comment on your satisfaction with AMEX. I checked them out four or so months ago and there seemed to be a lot of dissatisfaction with their website: often slow, balances not updating (especially bad in IRA accounts where you can't buy unless you have the cash, etc. Do these complaints sound familiar (or are they perhaps not an issue to you as a long term and therefore infrequent trader) OR have they been corrected. So far I'm relatively happy with AMEX, but they do have a ways to go in improving their customer service on the web. Balances are indeed slow to update and they frequently make mistakes on their web site. For a while I was being charged margin interest even though I had cash in my account. With all that said they do correct the mistakes once you call one of their reps. I don't have my IRA accounts with them so I can't comment on those. I'm also surprised that there is no mechanism in their web site to initiate ACH transfers into my account.Even with all their faults I still think that to me these are just minor annoyances that I'm willing to put up with for the commission-free trades they offer (buys are free with > $25K, buys and sells are free with >$100K). The other thing I really like is the free online bill paying feature. I use that for 99% of my bills now, and after some intial hiccups it has worked like a charm (it does seem to be next to impossible to get a hold of a human being in that department, but they do answer their e-mail). The advantage over buyand hold.com is that you save on commissions and you can place trades when you want, plus you are not restricted to their set of companies.I place maybe 20-30 trades a year, mostly buys to dollar cost average into my existing positions. Part of GG playing is to buy a basket of companies involved in the particular technology you are following. Commission-free smaller trades make this feasible for someone with limited funds. My strategy is to dollar cost average into my positions over time, thus lowering some of my risk. When the market goes down I become a bit more aggressive and up the amount of money I'm putting in for that month.If I were a day trader or a swing trader I wouldn't think AMEX would be ideal because of their mediocre service. I haven't had a problem with trade executions at all, but I can imagine their system triggering a margin call by mistake and selling your positions. Also if you sell the same day you buy you will be charged $14.95 for the trade. My view is definitely long term, and as such I strive to keep my expenses as low as possible. I'm definitely not fighting for that 1/16 or 1/8 of a price difference. I'm happy to get a good price for the day and then let those shares sit in my account for a very long time.Good luck with your investments.Erick(xerohype)
I kind of liked the inspirational post of borosn. Some times I get a little sad for essentially the same reasons. If you are unlucky and you government make an attempt to retain "control" money will avoid you and you country as though you had the plague. The old versus new is a sophistry to some extent but as it truly becomes more one- worldy, money will zip around like a crank addicts eyeballs. I dont know, I just heard! I dont care what Soros says, it was no coincidence that the currency of a number of countrys dropped in value. Check out their printing presses. The sword of D hangs over us all. Still you got to enjoy the ride. I wish I had 20 more years. Talk about mistakes boy I cant wait to get started. Binturong
though I cannot figure out why HDI is a gorilla, but Bruce listed it, so it must be oneAlthough I'll probably go to my grave riding my GoldWing Aspencade, I'm one of the first to admit that Harley Davidson does a superb job of understanding their target audience and a superb job of marketing to them. Add in the artificial limits placed upon production to keep demand up and you have a money machine. Unless something happens to change things, there is no reason to not forsee a rosy future for the stock.Personally however, this is one where my gut churns too much to own. I despise the artificial production limits and refuse to support or participate.Steve Kfrom a "Milwaukee Iron" suburb
Just thought a few of you should know this, but I just applied to this new company called folio[fn], where you can create and manage your own personal mutual fund. You can set up say, 10 stocks that are each 10% of your portfolio. If a few of these stocks are big winners and a few losers your percentages of each stock are going to be a little out of whack. At foliofn you click one button and all 10 stocks are adjusted to be at 10% again, and somehow foliofn reduces the capital gain tax that most mutual funds get stuck with. If you have lost favor with one of your stocks, you can replace it with another up and comer. There are no transaction fees, but there is an annual fee of $200-300 a year. For some of you that is a steal. If this sounds interesting to you or you didn't think I explained it very well, take a look at their website at www.foliofn.com. Foliofn's demo explains it a little better. Can you imagine managing your own GG portfolio just like the supposed pros. Hope this sparks some interest among you Fools. Ciaoajcapron
krishnarama listed holdings and wrote:ARMHYCMGIQCOMJDSUBRCMNTAPARBASEBLITWORBAKSo every month I am adding same ten stocks (four or five shares in some of those companys. Sometimes I even buy one share based on the stock price). My commision charges are like three dollars for each purchase.My concern is Am I doing the right thing by Buying the shares in those companys for long time.First off great slew of companies to own. Second off I haven't had time to keep up with this thread so I hope I'm not being redundant here. Third, the longer I'm in the market the more my impression of the markets change. So this is just from my personal experience, using my personal talents, and the amount of time I choose to spend on it. And all these things vary amongst individuals and therefore this advice is not applicable to all.I would say that blindly buying these 10 stocks each month will work if (1) you don't look at the price and are truly holding for 5 years or more, and (2) you follow each companies fundamentals closely. At least on a quarter to quarter basis because technological advantage can dissipate much quicker than consumer brand advantage and must therefore be more closely monitored by the shareholder. Here are some quick and dirty metrics which I posted and used RNWK as an example: http://boards.fool.com/Message.asp?id=1380180001007000&sort=postdate This should allow you to systematically track these companies from Q to Q to make sure your companies are not getting sick or in need of further review.But this said, I have become more and more convinced, given the increasing volatility of the market, that just putting money into "high flying" tech stocks at any old time is not the best way to invest your money. I stand firm that the tech field and LTBH is the way to go. But it is becoming more and more apparent that as predictable as taxes and death so is the fact that tech stocks will go up and tech stocks will crash, and that this cycle will happen more than one time per year and it just makes more sense to buy your list of stocks nearer to the crash points than the up points.Knowing exactly when this will occur, or what the bottom will be - well, that is difficult. But knowing that this cycle will occur is a certainty. So I suggest patience in some of your buys. Continue to buy these stocks, but possibly have a bias towards investing money during stock market crashes or into individual stocks following a crash for no real fundamental reason. As I look at my portfolio which has consolidated completely into BRCM, CREE, GMST, NTAP, and RNWK, the two things that stand out are the G&K elements of each of the holdings (+the Godzilla elements towards RNWK and GMST) + the excellent entry points I made into these stocks. I haven't always bought in at great points (e.g. I bought some GMST at $104 and CREE at $182 - tidbits of $, but still bad entry points) but all my initial entry points were at or near the bottom of market "corrections". Until I thought about it yesterday I wasn't even aware of this, but yes, market timing for initial purchase played a large role in when I bought and which of my target companies I bought. SO VALUATION AND MARKET TECHNICALS ARE NOT IRRELEVANTThis doesn't mean trading these stocks. It just suggests using some patience and some discretion in which stocks you buy when. My wife is still a bit upset with me because she gave me her 401K money in February. Had she just held out to early May - well, you can see the value of a little patience and playing this cycle of volatility.So to conclude: (1) the stocks you hold are great companies; but (2) they are not no maintenance holdings, you must monitor them and they are not necessarily fit for blindly tossing money into them, keep good track of their businesses; (3) take advantage of market volatility and have a bias for investing in those stocks which are at better relative valuations or during market corrections; for example not more than 3 weeks ago RBAK was in the 50s, today is is in the 110s, tomorrow it'll probably be back in the 70s. Even if it doesn't get there you have 9 other great holdings which will be just as volatile. be patient; and (4) continue the LTBH philosophy. If the companies fundamentals remain sound just leave it. Ignore price for everything except for finding better relative entry points for your stocks.As I become more and more sophisticated in the market I stick to the fundamental long-term-buy-hold philosophy but I also pepper it with skills learned from traders and observation such as the intense volatility and a new found respect for the power of patience for each incremental dollar I invest.Tinker
There are a couple of points with regard to your thesis that I think you ought to consider, Tinker.One is that dollar-cost averaging works only if (a) one has the discipline to follow it through month after month, come rain or come shine, without exception and (b) there is a regular inflow of funds into the investment account. Assuming that one has the discipline to carry out (a) (a huge assumption) and that one's choices don't fall apart, the absence of (b) means that one will not have the cash to buy those now-cheaper shares unless he sold at least a portion of his holdings at or near the top.The second is that it is virtually impossible to forecast a top in advance (though it's relatively simple to do it while it's occurring). Thus overdue caution with regard to a possible top may prevent one from buying into a stock just when he ought to be doing so. What matters is not so much the point in the market cycle at which one buys, but the willingness to recognize that one may have been in error to buy when he did and to move to the sidelines until his view of the landscape becomes more clear.
The second is that it is virtually impossible to forecast a top in advance (though it's relatively simple to do it while it's occurring). Thus overdue caution with regard to a possible top may prevent one from buying into a stock just when he ought to be doing soBut this is not really a problem. I have no illusion of forecasting a top or a bottom. What I have realized is that my money is very valuable and that I already own a lot of what I want to buy more of. If I'm patient I will find entry points which will give me a better return on my money. If for example CREE doesn't fall back to $100, BRCM may drop back to $115 or NTAP back into the $50s, etc. I don't have to feel stressed just to buy something because I have money to spend.This only applies to incremental money. Once I have bought the stock I just let it ride. So with your incremental money your looking at 5-10-15% of your money at most. Overtime the patience you use will add up to many more shares than you would otherwise have owned while your already invested in everything else you want and will still benefit from any huge bull-market.Back in February, with all this excess cash, I couldn't find any of the stocks I liked at a reasonable valuation so I spread my horizon and started buying more speculative names. The fact that nothing I wanted to buy was at a valuation I was willing to buy it at should have been a warning sign that I should hold off a little bit and have some patience. Perhaps I would have bought some more CREE at $135 than $90 (as it bottomed around there) but it certainly beats buying it in the $180s. Some rudimentary market timing is involved, but your spreading it over all the stocks you own in your portfolio. Overtime different issues will be at better buying price points. At this time and place, if nothing has fundamentally changed with Q, buying more Q would certainly have to be at the top of the list. For me, buying more GMST made the top of the list each and everytime it hit $40, and then $36. Three different buys. And I can't say that buying at these points was luck, it was just taking advantage of what the market was doing. And this latest market drop fortunately gave me a lot of these buying opportunties to the point that I was out of cash within a few days of the market "correction" upward.But even if the market had not given me that much leeway, I'd still always be at least 85% invested at all time, and more probably in the 90%+. I guess I'm saying that market timing with extraneous dollars has begun to make sense to me. It is not a matter of guessing a bottom or a top but finding what feels like better buy-in points. Once bought in you ignore price if the fundamentals are correct.Even Q last year, in all its greatness, had several crash points, all of which provided great buy-in points and were much preferrable to buying at $800. There is no way I would have predicted this current Q bottom. $140 was my idea of a bottom. So I'd buy in at $140, then double down at $100 and $65. Beats buying at $200, $175, etc. had I been buying into Q during its fall my buy-in points would have been $140, $100 and $65. As can be seen a poor job of predicting a bottom, but the best I could hope to do over time. (these figures are not arbitrary, they are the buy-in points I pondered on making overtime but instead opted for other companies). Just a matter of following a stock and making your best guess. If you miss out, well your just missing out with 5-15% of your assets at a time and another opportunity will come along.Just something my experience has taught me over the past year and I thought I would share it. Also note that the old adage "catching a falling knife" is not without merit. That is why I stick only with premier companies in hyper-growth markets. I've caught more than one falling knife, as the GMST and Q examples indicate. Just catching them at lower prices is far better than catching them at higher prices all things being equal.Tinker
Tinker,I agree with your approach.In my 403(b) retirement account at work, the options available to me are limited. Hence, I dollar cost average into the total stock market index fund available. Its a LTB&H vehicle and there is no way I can study each company in the index. I handle my non-retirement account differently. First, I make sure I have a minimum amount of cash in it at all times for emergencies. Then I select no more than 6 companies that I've examined and monitor quarterly and feel comfortable in holding for at least the next 5 years. My holdings are QCOM, JDSU, BRCM, NTAP, GMST, SNDK. When I make the initial purchase, I always just put down a partial investment. That's because whenever I buy a stock, IT ALWAYS GOES DOWN (I'm serious ....). After it goes down, I then put in the rest of the investment so I dollar cost average down and feel good about my bad luck in timing things (probably kinda sick thinking but what the heck, it keeps me happy). If/When there is a market correction, I view adding to my positions as a company CEO would view a stock buyback .... it's good news, not bad as long as the rest of the market is tanking too.I'm not 100 percent sure that I will become wealthy this way, but at least I am 100 percent sure that I can sleep well at nights.Akoni
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