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Stephen,
MHI is of course in an uptrend, but rather more importantly, there is no sign at all of any technical weakness yet. The On Balance Volume indicator usually gives good warning of a stock topping out, and it is still rising. (There is no sign of distribution). Slow Stochastic oscillators also can identify changes in market sentiment well before they become reflected in the price.
MHI has not even come close to giving a Sell signal since the Buy signals of October and December of last year. Sell? MHI??? You would have to be a fundamentalist to even contemplate such an action!!!!
If you were able to accurately calculate the "true worth" of MHI, I would still see this fact as being of little practical use. The reason being that stocks in uptrends almost invariably overshoot this figure by an appreciable margin. To sell any rising stock when it reaches its "true worth" is to sell too soon.
Similarly with falling stocks. To buy a falling stock when it reaches its "true value" is to buy too soon - they usually overshoot and fall well below this figure. Why pay more than you have to?
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Totally exxxceeellleent Posts--as alwasys Dimey,[8D]
"Buy and Hold" with a good sense of Timing in the right Niches; and after you do your Field Evidence Homework: AND do be prepared to be iconoclastic, contrarian, and to GO against THE CROWD: and to have the courage of your investment CONVICTIONS; and NOT to sell short, or be swayed by naysayers and dommsters !! !!
**Also IMO--do try; to have some of your portfolio with an exposure to Growth Industries and in International export markets, with a growth in Demand.
Also find Companies with exclusivity/moat around their offering(ie: High &/or v.difficult barrier top entry which enables co. to suatain High PROFIT MARGINS &that is not exposed to cyclical Commodity Prices Markets; with Proven excellent pedigree Management: and be WARY of high Debt/Equity ratios///And remeber: Buffet doesn't: "Do Turnarounds"......
Finally do not under-estimate the POWER of excellent Sales & Marketing Teams, systems, Advertsing, branding, merchandising superiority, large number of sale Distribution systems and multi-sales channels... This is often overlooked by "quant"; anaysists who spend all their focus on Balnce sheets, as important as these are...
I first got into Astron in the early days, when I found out they had over 500 Sales agencies....it is now far north of that....Look at the Buffett icons, your Disneys, Coke, Amex, KFC, Mc Donalds, Seers Candy,Pepsi Cola, Pizza Hut, Wendys,Marlborough Cigarettes, GEICO Insurance, Reynolds & Reynolds,Washington Post---all Unique and powerful Marketing Brands and powerful Sales Systems and World's Best Marketers...Michael Eisner was a marketer...
Cheers & Regards,
Robbo
quote: Originally posted by Dimebag
Runswifscissors
Yeah a few more now than a few years ago! After a few years of early stumbles, going through the inevitable learning process, things have started to pick up. My portfolio is up from $71,000 to $123,000 so far this calander year, and up from closer to $20,000 at the beginning of 2002, so not too shabby.
The first few years were not so successful though - I succeeded in losing about $5,000 over the space of 2-2.5 years. The problems were as discussed above - poor judgement, and dabling in stocks that were simply too average about which I had no strong conviction. Hope and guesswork featured much too highly and I bought too many stocks. I also over-traded - the grass also always seemed to look greener.
Fortunately since then I have cleaned up my act. My judgement is improving and I am operating a much more concentrated portfolio focusing on a few truly unique companies. I'm still making plenty of errors though, but there amount and severity are declining.
Cheers
Dimebag
TLA87 - I was unaware that was the case
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Member
You serious?
Why do you think "Dimebag Darryl" (the guitarist from Pantera) changed his name to Dimebag? - before Pantera gave up glam-metal it was "Diamond Darryl" kinda fruity really...
A dime in US slang is 10. A dimebag = a $10 bag of marijuana.
quote: Originally posted by Dimebag
Runswifscissors
TLA87 - I was unaware that was the case
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Junior Member
I'm more of a B&H than a trader... but a valuable lesson I learnt with EBT many years ago was that if you continue to hold a share that drops and then lays stagnant then its best to take that money and invest it elsewhere and re-coup losses gradually than wait for the original share to improve again.
I hope nobody read that out loud, otherwise you wont have any breath left!
whirl
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Member
GEN is a case in point for me. I got in "cheaply" before it listed and bought more in the IPO. Invested $29k in all. By late 2000 the stake was worth nearly $60k. Managed to sell some @ $4 during the slide but should have sold the lot. Today my stake is worth about $3k. Not worth selling now so may as well Hold & Hope, though I know others will say I should sell even now.
So I've learnt from my experience with GEN and RMG (also a hold and hope) but I've learnt even more clearly from some of the wiseheads on ShareTrader. Now have a fluid rather than a fixed exit strategy, e.g. WHS @ 463 recently.
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I think many people would have made that particular mistake, Lawso. One of my examples was with CER (Ceramco). I bought very well (CER was in a good uptrend) and I tripled my money in a surprisingly short time. The uptrend ended with a clear reversal and a downtrend began. I was a "Buy and Hold" type of chap back then, so I held. And held. And held. All the time CER was in a steady downtrend. I finally sold when my initial investment had halved in value. Hard to believe eh? My inactivity had turned a 300% profit into a 50% loss! I would like to be able to report that such a thing never ever happened again, but alas, it did. I think I must be a slow learner - I seem to have to make every mistake 3 times before the lesson is finally driven home.
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Phaedrus
I too was a slow learner -- for close to the the first two years , making all of the errors that new investors inevitably make
From what I have read and heard it seems that all new investors have to suffer several significant losses as their dues to becoming a reasonably competent investor --- this was certainly the case with me --- ouch !!!
I am pleased to say that bad picks have been few and far between over the last eighteen months
Long may it continue
Constant vigilance and "stop losses " help absolutely heaps
Time is the great revealer
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