TQNT, VIT - Ernie

[jce05]

at what point do you cut bait on these two, take the loss and move on?

thanks James

[Karel]

$$$Mr. Market$$$ is never in a hurry to sell his stocks, even if they remain under water for quite some time. But when too many stocks are in the doldrums, $$$Mr. Market$$$ will clean the mess out. And even then it could be a perfect day for a round of golf. And beer. Or beer and golf. Then the stocks will have to wait a bit longer.

Sometimes external reasons result in a cleanout too (golf and beer permitting, of course, and I forget Las Vegas and filthily huge cigars), for instance when a company gets bought out and the price breaks the winning streak.

Regards,

Karel

[Deaddog]

$$$Mr. Market$$$ is never in a hurry to sell his stocks, even if they remain under water for quite some time. But when too many stocks are in the doldrums, $$$Mr. Market$$$ will clean the mess out. And even then it could be a perfect day for a round of golf. And beer. Or beer and golf. Then the stocks will have to wait a bit longer.

Sometimes external reasons result in a cleanout too (golf and beer permitting, of course, and I forget Las Vegas and filthily huge cigars), for instance when a company gets bought out and the price breaks the winning streak.

Regards,

Karel

Karel : You have been with The Huge One for quite a while. Has that been the pattern in the past?

Hold the losers and keep the winning streak intact until something, like a takeover or bankruptcy, forces a sale which breaks the streak. Then clean house, dump all the losers and start over with a clean slate.

[Karel]

Karel : You have been with The Huge One for quite a while. Has that been the pattern in the past?

Hold the losers and keep the winning streak intact until something, like a takeover or bankruptcy, forces a sale which breaks the streak. Then clean house, dump all the losers and start over with a clean slate.

Yes, that is one of the two options I mentioned. The other option is when too many stocks have promoted themselves to dead wood. I don't know if there is a fixed rule for this; probably not. But as long as enough stocks continue to reach $$$Mr. Market$$$'s target, the dead wood is not considered much of a problem. Only when torpor starts setting in for the portfolio as a whole is it time to reset the streak.

BTW, this is why it is such a bad idea to throw everything and your last penny at the most recent $$$Mr. Market$$$ stock pick. You might pick the occasional lemon and it might remain in $$$Mr. Market$$$'s portfolio for a long time, if the other stocks continue to keep up the merry dance. His method just requires diversification.

Regards,

Karel