| Posted: 27 Nov 2006 21:15 | |
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Just wondering how many people are reading this who consider
themselves to be 'value investors' ? Can I get a show of hands? As for me, I gotta be honest... I'm not in a position to buy and hold a stock for 10+ years. I want to get in, and preferably get out ASAP.... No, not day trading... but if I pick up shares of a company, and it goes up 10% in 6 months, I might actually dump it. I dunno, anyone else kinda more into faster trading? 
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| Posted: 01 Dec 2006 15:31 | |
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I do both i have permanent investments Altria and Berkshire and take positions in Wal mart anheuser Busch Ust etc. Bought Wal Mart at 43 and sold it at 51.70 in october . bought it back today at 45.54. My "formula" is given in my book which quotes Warren and Charlie Munger.The retail price is 30.00 but members of this forum can receive it for 12 dollars postage paid.
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| Posted: 01 Dec 2006 15:59 | |
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Great timing on some of those investments!
Altria just had a great legal ruling in its favor I think, too. Wal-Mart.... now that's a company that's had its share of bad press and sagging growth lately... What's leading you to think that the WMT is positioned for an uptick in it share price going forward? The street might be reading a lot of negativity into their stock, which always presents an opportunity... Ethan
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| Posted: 23 Dec 2006 23:00 | |
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Ethan : There's a terrific case to be made for BOTH trading and so called value investors ( of whom Mr Buffett would seem to be the undisputed king ) . I appreciate HIS style , and use it to s lessor degree . Most of us , myself included , simply can't afford to purchase a large buy and hold position for the long term . If I could live life over again , I'd embrace Mr Buffett's concept entirely , as the clock is ticking I'll stick to trading and hope to make up for lost time !!! Best Regards .
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| Posted: 15 Jan 2007 09:59 | |
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Buffettfunumber1
I embrace buffett's style in all ways. I dont trade I study a company and buy shares and hold for several years min 5yrs. I bought USG at 14.05 in 2004, it short up 110 a shares, I did not sel it dropped to 45, I didnot sell never will regret it, its at 55, I dont care. .......That is investing not speculation. If you are going to do well in the stock market you need to control the urge to trade, it seems like a good I idea to make 10% on as stock in two weeks but that is market time a very popular but often unsuccessful strategy. Own the business not a stock of the business does well the stock will do well. If the business is very profitable you may sell your shares at 1100% gain or more in 5yr-10yrs or more. I manage Brokerage accounts for people and one that I love to look at is of a client how bought CELG in 1998 for $3000 in his 2yr daughter's UTMA account, that position is over $120,000 today. He person. He called me for advise of if he can move it to his personal account. I told him to get on his knees and as his now 11yr old daughter for permision. Very bad Idea to trade but its very popular: Reason: To be uncommon man you dont have to act rationaly, rationality follows price and its movements that are imaterial as far as the underlying business of the company is concerned. DO NOT TRADE! ITS BAD BUSINESS, BUT MAKES BROKERAGE FIRMS LIKE MY WEALTH. OR MY BE YOU SHOULD TRADE OR I WONT HAVE JOB!
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| Posted: 15 Jan 2007 21:30 | |
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BuffetFanNumber1 : Well if you are able to buy and hold and are happy that's terrific . Not all people and situations are equal however . Suffice to say ( and I'd agree ) most people should NOT try trading . This Poster doesn't trade stocks , I trade primarily options . If all I could hope for was a 10% gain in a week or a month I wouldn't bother anyways . Do I buy and hold stocks ?? Absolutely . I own among others XOM , MCD , and KO , two of which are on WEB's favorites list . But it was OPTION profits that bought and paid for those shares ( trading ) . Just a couple months before AES Corp was to attempt to get it's refinancing done ( Co was almost Bankrupt ) I bought 20 AES CV Bonds at $200 each and sold half at $600 the other half at $800 two months later . Had it not been for this trading I would have likely been bankrupt myself after a rough divorce and a financial haircut . March 2005 , expiration Friday this Poster had 20 Genentech ( DNA ) $50.00 Call Options that prior to the open were out of the money and due to expire at the end of the day . Purchased for $50.00 each the previous week , sold mid day for almost $900 each . Funny you mentioned CELG . I have done very well on Celegene , never owned a single share . I'd advise your client to hold on to those shares a while longer too , CELG is not done yet . I expect blow away earnings . I'll be there too , fully loaded with options .
So is trading bad ??? Depends on who you ask . Do I always make Money ?? Absolutely NOT . Do I make money ??? You can bet your Posts I can , have and do . Best Regards , TBB43
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| Posted: 21 Jan 2007 12:19 | |
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TBB43: Thanks for the feed back, Sorry I will keep my stand that trading is not a good Idea, but the problem is that it looks rational and reasonable. I will tell you, if you ask 100 people if trading is good or bad, 93% will be on your side TBB43. That also explains why we have more failures in the market than winners. Don't get me wrong, I am not calling you a failure but because I don't know how much profits you have made in the market over the years. The point I am trying to raise is that you will be successful trading a stock were you make only 10% or at best make 60% on a stock. That is success to a trader but pea nuts to Buffettfunnumber1 who likes 680% or 950% percent gain. Remember this is the Buffettfan forum, the Unreasonable man as we know him. What makes him unreasonable, he does something no one else is willing to do, he does not act rational, at least that is the way we percive him. So to be very, very successful you can not follow the herd. To achieve unimaginable results, you have to use irrational ideas and the simplest is "Buy companies of strong competitive advantages, good management and at good prices". Withdraw the certificate of your shares out of your brokerage account(to keep your eyes of the daily market values) and keep it in a safe, never pull up qoutes except once a year on DEC 31, and pull up the company's annual reports as well. 5-10yrs later, the success of your investments will not only amaze your peer but yourself as well.
Buffett says be greedy when others a fearful and fearful when others are greedy. That is the simplest way to get rich. I have tried this strategy, Not easy for you who watches the ticker-tape veryday (I dont). But your 10% or 60% is far unattractive compared to my 680%-950% gain. Remember, many times odds are against you because you or myself cant predict the future but because you make thousands of decisions where I make one decision. Your success will never equal mine (The buy and hold investor). Not a speculator. I own businesses I dont try to profit from short term price movements, and i have made it big in the markets. Like Graham says, in the short term, the market is a weight machine but in the long-run its a voting marchine...I votes who will succeed and for who didn't make it. .......I recongnise that everyone's situation is different, but the truth is that, that's life's way of denying you gold. I will make your life different for what every reason so that you give up gold for bronze. Have a nice Day TBB43. Buffettfunnumber1 NH,USA
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| Posted: 24 Jan 2007 02:30 | |
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BuffettFanNumber1 : Thanks for the lengthy reply . If you re-read my post you'll notice perhaps that I agreed that MOST people shouldn't trade .
What I do is use leverage for results . Options provide that leverage BFN1 . Yes sometimes I lose , but when I win I can and do win big . 10 to 60 % ? Well if I did that in a one week round trip trade I'd be a bit disappointed . My usual goal is 100% or a double . This is usually accomplished within 10 days . I've seen many 1,000% or better weeks , six straight months in 1995 were such . The only bad side to options is that if they go the wrong way there can also go 100% of your money . As far as buy and hold....well there are as you may point out numerous examples of spectacular returns doing just that . But I ask ....what about long term holders of say WINN DIXIE , a once blue chip company listed on the NYSE ? What about Delta Airlines which for many years was considered the best airline stock to own and traded at a nice premium to other airlines ? Buy and Hold ? I can give you numerous examples of folks who lost it ALL owning what they thought was a blue chip company . True , WEB likely would never have been interested in say WIN but he did have quite a fling with US Air at one time . If you do fine with your style , more power to you . But no thanks , I'll stick to mine for me . But lastly , please don't under estimate the potential of options to make huge profits , it's real , been there , done it , seen it and lived it . I'll own far more equivalent shares and still enjoy every penny of upside over the stock strike price that you would , and my risk after selling is zero and I will take a profit . As long as you continue to own anything , there's risk inherent in it . Once you cash in the chips , it's simply cash in the bank . I could care less at my age about turning $5,000.00 into $200,000.00 in 10 or 20 years . I likely won't be around to see it anyways . Twenty years ago it would have been different . Best Regards , TBB43
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| Posted: 29 Jan 2007 09:02 | |
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TBB43: This is Buffettfannumber1 again. Thank you for your feed back on companies that were blue chips and how have gone bankrupt, your use of options and your desire to continue trading. First of all, I looks like you saw some sence in my buy and hold strategy. You said "If it was 10yrs ago, may be" What was there 10yrs ago that could have make you buy and hold stock and not trade? Going back to the blue chips that when bankrupt, blue chips are call that name as defined by the street, my be the street sees they are strong enough to be in the S&P or Dow, for whatever reason they may be there. The are several blue chip stocks I can never look at for investment, just because they are called blue chips doesnt make them good investments. TBB43 I dont know your background but personally I am a student and former University teacher in Finance, I also have an MBA in this business. However, there are things I agree with and also strongly disagree with in Finance itself. I have tought it and practiced it. The fact that a stock is listed on the NYSE does not make it a good investment at all, that is just a place stocks trade, even if the place has a good name it does not make the individual companies that trade their good investments. The ground rule is: If you buy toads that have been masked to look like princesses, it does not matter how lovely your kiss is to turn try and turn them into princesses, they will remain toads. The mask will eventually come off and they will reveal thier true self. Win dixie is a company that is and was competing in an industry were it has absolutely no competitive advantage. Mind you competitive advantage is the soal of a business. Nothing esle,just that! Its other bigger competitors like Walmart had the advantage, that means even if it was rated a buy for several years, earnings were great for some good seasons (I also rains to the underprevilaged quite often), still the company was doomed by its own business model. TBB43, most retailers like KMart and Sears were always considered to be blue chips, but I could never and have never, will never invest in such companies, I dont need to tell you what happened to them. But buy thier own make up and management style, they were always not good investments. The other ground rule is " Companies with a high level of fixed assets to sales generally earn low rates of return especially in the longrun" ....Look at what is happening to Ford, GM. The cousin to this rule is " Companies with high over heads costs to sells also will earn low rates of return" ......There are your airlines.....If you ever want to loose money, pick an airline stock. It does not matter which part of the world it flies to or from, it will loose money. Finance principles have proved it several times with many European, Asian and US airlines.
How that you have understood the rules, lest get back to trading: Since you have to have slightly agreed that trading is not a good idea, I am not asking you to change yourself but the young people you talk to should not be tought this poor investment method. The weakness of the trading method are born not from the financial press. The press is there to sell news papers and information and that is all they care about, whatever negative news they can find, is the best topic for the headlines. Turn on the TV, how much positive news do you see, but accidents, court drama etc, Financial press is no different. TBB43: We all me shall assume you are a devoted dad of 2 adopted teen age girls. You are a also one that loves high achievers and your girls have to show you that they can do it. Recently you adopted another teen age girl and you have the same expectations. You want to see good performance in all aspects especially academics. You enroll you new daughter into college at and she takes 9 classes. Coincidentally you happen to be very good friends with all the 9 teachers she is taking classes with. And they report to you about her performance every day without fail. They send weekly reports, the school has a local TV broadcast where parents tune in to get news about students behaviour at school, good weekly grades are the talk of every parents that watches this station and you are one of them. Some weeks you here your daughter is in the list of good performers, and other times she is not mentioned at all. In addition,the teachers knock at your door to tell she did not do her home work, was late for class etc, all the negative news they find. They never miss a day or week to report bad and good news. On day your daughter catches a cold and can't study, she fail two of the weakly tests and being a dad who rules a house of high achivers, you cant stand it. You ask her to pack her bags and go back to her birth parents.(Short term performance is the key to you), and she moves to a house of another dad who hates and does not like the daily feed back from teachers. He believes her daughter has a strong potential and is poised for greatness. He just sits back and watches what she does. At the end of he year the girl goes on to be the number one performer in the eitire state............If your daughter was a stock you sold a the wrong time. If you believe in her potential (Competitive advantage for a business), give her time to prover herself, disregard the daily publications which fuel fear and pessism.....I have not talked about options, Next time TBB43. Kind regards , Buffettfannumber1
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| Posted: 06 Feb 2007 16:29 | |
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I'm a big fan of Warren.
I read Lowensteins biography, I read all of his letters to shareholders, interviews, articles, I love the videos online (Charlie Rose interview, his Florida MBA speech). But I've never understood why you have to get seperated into different camps if you're an investor. Value, growth, trader? Why?! It's like politics, and seperating you into democrats or republicans. I would consider myself just an opportunist, if the odds make sense on something, if it falls within your circle of competence (or your expertise), you invest. Seperating it into value, trading...that'd be like telling me if I'm on the basketball court, that I can only shoot 15 foot jump shots or go in for a 8 foot hook shoot. Why restrict yourself to only one kind of shot on the floor if other shots are available? Biggest lesson I've learned from reading/studying Buffett is you never just guess, or "hope" something will go up. You wouldn't go down to the corner and sink $20,000 into a private business you don't understand. Same with public businesses.
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| Posted: 07 Feb 2007 00:58 | |
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John23 : Good point . I'm a trader ( option's trader really ) but definately also buy stocks for the long term , many of them I own as a result of profitable options trades ( like Exxon , McDonalds , and GE to name a few ) .
It seems BuffettFanNo1 is on a one man crusade to show me how foolish I am . I say different strokes for different folks . Some people would be quite content to Buy 100 shares of XYZ for $10 a share in January and sell 100 shares at $15 in February . Me , I'd wanna know if XYZ is an optioned stock , and if so , place my bet on an upswing by buying calls or a downswing by buying puts . Other folks are quite content buying XYZ at $10 a share and holding on to it forever . In twenty years they are pleased as punch if they now have 500 split shares trading at $20.00 each . Me , I don't have 20 years left , so I do what I do with what I can . Best Regards , TBB43
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| Posted: 07 Feb 2007 03:52 | |
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Thebigboss,
Another very valuable thing I've gotten from WB is to question, or at least examine commonly held "conventional wisdom". He doesn't believe in beta, CAPM and all sorts of other things that everyone else thinks is true. The "conventional wisdom" is that you have to beat the market every year and that sort of "proves" you're successful. Yet success to me is meeting my own personal goals, I don't have to make 20% a year for 40 years and make hundreds of millions of dollars to be successful. I'd rather focus on the highest of probability plays, than having to meet some artificial benchmark. As for trading being "bad", the ease of trading is what gets most people in trouble. The ease of trading and the casino type mentality perpetuated by CNBC, the media, etc. If traders used Buffett's "20 punch card" philosophy (which I think is brilliant), you'd save yourself alot of money and headaches. The average person would be much better off being limited to 20 trades in his/her lifetime (forcing you to really think things through) vs unlimited, virtually free trades.
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| Posted: 09 Feb 2007 01:43 | |
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John23 : I absolutely agree . The ease of trading allows people to make purely emotional decisions . And emotion and the market usually are a bad mix . One thing better traders understand is one of Cramer's sayings : Go with Best of Breed . WEB thinks similarly with his long term approach . It's always Best of Breed . Second or Third Fiddle won't play .
With my option trading , it's ALWAYS Best of Breed with calls or Worst of Breed with puts . It's served me fairly well . Best Regards , TBB43
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| Posted: 09 Feb 2007 01:48 | |
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Whatever happened to Ethan Jones Anyways ?
TBB43
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