LR1400

Why do people hold stocks as a long term investment when there are liquid markets for shares on a daily basis? Seriously. I continue to doubt buy and hold for businesses placed in an auction house.

That is true in the definition sense. However, a person like Jesse Livermore or Driehaus, who most would call a speculators was still attempting to compound his, which is investing. I personally view the terms as interchangeable as they both have the some end result goal.

Scott, I agree value investing does work and the core concepts make sense. It's been proven. It requires too much waiting to see and also too much riding the price up and down, often 30% or more. I would prefer to be in cash while the stock prices are down. Buying and holding for years makes a lot of sense when brokerage commissions were so much higher, like say in the 80's. Simply, there are other ways as well and it wouldn't surprise me if Munger followed that path were he younger.

I know I will get annihilated here, but I have had more success buying and selling growth companies in a manner similar to momentum investors. When going value I got virtually no return. Are there any others who have transitioned to more of a momentum approach? I still believe in the Buffett idea of owning a business forever, though often this is unrealistic. Market forces change and can do so rapidly or slowly to the point you notice too late. And if this is in a privately held business, you can often be stuck. I like the idea of selling if the price goes down a certain percentage as opposed to averaging down. Then redeploy the capital somewhere else.

You must be a broker. If he's not, he's gonna be soon. ::) You nerds need to live a little. It's ok to have some drinks, even if Warren doesn't. :) Not a broker. Business owner. Original post was a joke, but since you care... :) I live just fine TYVM. :) Couple drinks per day is a way to alcoholism and other medical problems. It's your life though. We care and we wish you well, but it's your choice after all. ;) And yeah maybe you gonna be just fine. Have fun and good luck. Update. I quit drinking. Was using it as a crutch. I'm not opposed to it in the future in moderation, but done for now.

How do these people keep getting investor money?

Use a stop loss

I don’t agree with no middle at all. That’s bs. That may be the case for development but not investing. Middle area and middle income allows value add and most consistent and largest renter base.

By far the hardest thing for me to do as well. Value investors are typically so he’ll bent on buying cheap that many will stay in a bad deal or average down. Many also want to stay invested for the “long term”. Both have hurt me. I don’t think I’ll average down much again unless it is an extreme no brainer. Won’t do it on a commodity or potentially disrupted industry.

I just don’t see convoying being allowed. The public will revolt at dealing with 20+ trucks convoying together on already congested highways. If you are going to convoy, why not just rail. Much less disruption to public traffic flow.

My biggest mistakes revolve around selling. The desire to follow the “hold forever” mantra has thrown me off. I now realize the hold forever idea is only good for a few companies. I have instituted some definitive sell criteria for myself now, that I hope will allow me to be more disciplined than thinking hold forever/until something fundamental changes. When I look at say, a cheaper company like GE and look at a more expensive one like FB, I understand how FB makes money better than I do GE. I also think FB has higher probability for price appreciation in the next 5 years, despite FB being a “tech” stock and not meeting classic value criteria per se. Same with AAPL.

Scrap metal can be similar.

Someone is beating the market. The growth guys are/have been beating the market. Value not so much. But there’s still a link between the two. Pick your poison based on personality. Plenty have been successful both ways. Another aspect is, we rarely know what individuals do unless they write a book or an article. From reading about some of the growth/momentum guys they are as conservative if not more conservative than many on this board. Value makes intuitive sense, by so does a company that rapidly grows earnings over and over.

I’m also going to do some short to moderate term trading as John discussed, and note what he and Spek have said. All of the successful people I’ve studied that use this strategy use a trailing stop loss % of the high. They don’t put it in they just mentally have that target and sell if the price reaches that.

Any book about PE summed up: 1. Buy company. 2. Load with debt and/or massive labor cuts. 3. Acquire "synergistic" businesses. 4. Pump EBITDA. 5. Sell for higher "multiple". Lol