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This is the key sentence: "reasonable entry points". What experienced investors tend to forget is the number of inexperienced eyes which read their words. Taking the position that each individual must "do his own homework" does not absolve one from the responsibility for the ramifications of what he writes, though it may not be a legal one.

I should be busy adding the final touches to a project of mine, but I thought some of your views warranted refutation. This is not a professional association where we are licensed investments advisers. Nobody that joins the Fool and reads the message boards should ever be led to believe that. Adamant thoughts and discussion of individual companies, especially the type of companies that we discuss on this board, are tantamount to helping each other as Fools learn about IPR and technology adoption life cycles. That's the most important thing before price or underlying 'value' of the particular security even enters the picture. Nailing the IPR down and the tech's possible position to participate in a gorilla game - as well as understanding the technology adoption life cycle - is numero uno. Without that - we have no 'game'.

Once that work is done it pretty much boils down to a "do your own homework" which, when translated to me, means - 'pick your own entry price that matches your comfort level and knowledge of investing'. How many of us know what that is? I never forget the fact that the gamut of investing experience runs deep and wide on this and other boards when I submit a post. I also never forget the fact that we all make mistakes along the way in our investing. It cannot be avoided.

Previously, I'd provided a link and quote to one of the co-authors of The Gorilla Game who suggests the early candidates are to be bought and added to on dips without too much concern for valuations as the technology adoption life cycle progressed, it would all work itself out. As the technology adoption life cycle progresses, the consolidation into the dominant players will take place and through it all, the 'theory' is you will still come out ahead in a significant way. Geoff Moore is not an investor in individual securities by his own admission. His personal money is managed by a professional and according to what he has stated includes some funds. The other author specializes in venture capital.

Their focus is really on the game in technology and why certain companies will dominate and provide returns that dwarf the majority of other investments. They use the case history of some very important technology adoption life cycles. There are more going on as we speak. Regardless of current valuations of some of the most promising candidates in those games - some of them (not all) will make out like gangbusters. It's no secret. The study they did in the book was not unique knowledge to only those three authors and the readers of the book. It was nice of them to put it in a condensed form for all of us to use as a reference.

A look at Cisco, Intel, Microsoft, Oracle, EMC, Dell, AOL or a 'younger' crop of companies like Siebel, i2, Yahoo!, Qualcomm, Brocade, Network Appliance, Gemstar, Redback, Juniper, Sycamore, JDS Uniphase as well as many others go a long way to suggest there might be something to the theory. We can sit here today, in retrospect, and say:

'Gee - Cisco was really undervalued in 1990 - 1994 even though I paid those absurd prices back then'.

'Microsoft was a steal in 1987 - 1990.'

'EMC was a gift even though my broker told me I was nuts for paying such a high PE in the early 90's.'

'I could have had i2 for $9 in 1999'.

And on down the list.

We'll know more as time unfolds. One thing I'm certain about is this: there will always be an environment to produce a technology adoption life cycle that just might create a gorilla. It's rare, but the few that will emerge along the way will be hunted down and added to portfolios with a lot of regard to the IPR over the price issue. A lot of money can be made in the well executing value chain members as well, so I don't want to say it's a gorilla or nothing.

Although the ideal would be to combine the IPR issue with price, we need another ten to twenty years to have enough information to answer many questions we have today. Never has it been stated that risk was not an element. Never. It has been stated that the risk aversion might be a level that a long term investor would be able to tolerate by holding a well balanced portfolio of the dominant companies. Yet, risk will never be eliminated. Part of that risk is the price you pay for an equity in combination with the time frame you have chosen for investing.

There are stocks in my portfolio that have been there for years, but that doesn't mean I wouldn't sell them tomorrow if technical conditions warranted.

I assume you mean TA conditions. That's a strategy that might work well for you, but should be stated with just as much of a disclaimer as somebody who says they think a particular stock looks like an attractive entry point. History does remain on our side for long term investing to be able to create enough wealth to meet the majority of our financial goals in life. I'm a tortoise and although I'm well ahead of my goals thanks to the previous decade - I'm going to remain a tortoise. Time is more important of a factor in the equation than most give it due. The majority of investors in a company like either Qualcomm or Rambus have not yet even given these companies one year of time yet. One year! That's nothing when it comes to investing. Let's talk three, four, five, seven, ten years and see if we look back in 2000 and see any value. Once again, if one has a balanced portfolio a single holding should not hold one back from achieving their long term goals.

By the same token, my profits in cyclical stocks - such as semiconductors - are far superior to what they would be if I were simply to hold them throughout.

That's impressive considering Intel's 29 year return. Or 19 year return. Or 9 year return. Or 9 month return - 78% by the way. ;-)

Gorilla gaming is not a trading game. Years have to be devoted to it for receiving the financial rewards. Micromanagement is not part of the equation outside of consolidating the basket players into the dominant player once enough evidence is present to choose it. I know you mentioned you had no desire to debate timing vs. LTB&H. Until I have proof in front of me that refutes timing with taxes was able to beat the long term returns of Cisco, Microsoft, Intel, AOL, Dell, Oracle, EMC, JDS Uniphase and some others now and in the future - I have to continue to believe the gorilla game in high technology has a necessary adaptation to long term buy and holding of the companies within their respective technology adoption life cycles.

Again, choosing a reasonable point of entry and even of temporary exit is not only not impossible but not even very difficult. The fact that one might not have time for it or interest in it is a completely separate issue.

That's an interesting observation. However, it has very little to do with gorilla gaming. I'm not sure how you would feel comfortable saying a comment that choosing points of entry and exit as being 'not even very difficult'. That seems to be rather incongruous with what we are trying to accomplish on this board.

BB
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