Count .. Thanks for helping to restore civility to our discussion about investing. I don't think either one of us feels the need to get in the last word so if you don't respond I won't feel that I did. I hope you know now that my comments were directed at the very real dangers of anyone, not just you, betting the farm on one stock.
Did you read what I wrote? I SOLD. I did take money off the table ...
Frank it is your money and your retirement and you can do anything you want with it. You don't need to defend your investing style to anyone but yourself. IMO, all of what you have posted to me is just that; trying to convince yourself that it is not VERY risky to be doing something that you and Chris would NEVER recommend that your clients do.
I did read that you sold and you believed (dare I say rationalized) that meant you took money off the table and it was part of your "exit plan" and you were waiting on NOK good news to sell most of your position, etc., etc. First of all, you didn't really take the money off the table. You put it right back into the only stock you own .. the one you are betting on to make your retirement dreams come true. Also, although you didn't state so explicitly you implied that you would look for another "strongly" positive risk/reward ratio to bet the farm again. Every investor looks for stocks with strongly positive risk reward ratios. The difference is that they don't invest all of their money in one of them. You can claim that your hedge against suffering the fate you unequivocally and forcefully warn your clients about is your "rational and open-minded" DD but methinks you are having a tough time convincing your inner-self of that.
Yesterday John Daly admitted that he has a gambling addiction that has caused him to lose $60 million and will likely take him down for good. Here are some of his comments about his other problems" .. "I don't drink Jack Daniels anymore" (John, switching your choice of alcoholic beverage does not mean that you are now clean and sober.) "I don't trash hotel rooms as much anymore." (John, trashing even one hotel room means that you still have anger management problems.) "If I didn't have this gambling problem I would have everything else under control." (No comment necessary.) I certainly am not suggesting you are anything like John Daly but you MIGHT just be in denial as he clearly has been for years.
At first I thought, good point, Marsala is the most conservative analyst... and then it hit me, he IS an analyst, and therefore by default worthy of respect
I thought we had cleared up your misunderstanding of how I view analysts and institutions but apparently not. NO analyst is worthy of respect by default. They need to earn respect like every other person in the world. In the end if they don't get respect they don't get a paycheck at least for being an analyst. To paraphrase what I originally said about Marsala: No institution expects analysts to be infallible. That is why they almost never invest based on the word of one analyst, no matter how good they are. Nor do they believe everything a given analyst has to say. To the contrary, the good institutions question everything all analysts state. They like to have at least five analysts covering a stock with preferably at least one of them being a conservative "watchdog." That way they get a diversity of opinions on every issue affecting the success of the company. Finally, as I stated repeatedly, institutions worth their salt could not care less about analyst target prices. They are paid to prognosticate about stock prices and they will use their own methodology to do so, thank you very much.
I just need the price to go up even if I'm wrong about some things, or that I exit before it crashes, which is the reason for my constant analysis.
Good luck on that one. Trust me, the institutions focus on the downside far more than you do. In large measure their careers rest on exiting before any crashes and they have a hair trigger on the sell button in that regard. If you believe that your "constant analysis" will allow you to beat the institutions to the exit, you and I need to talk sometime about the depth, breadth and magnitude of the "constant analysis" by institutions directed at determining when to exit as gracefully as possible before the panic selling takes place.
My comment: Investing is not an art but it sure isn't a science either. Those who believe that they know how to make it one and are willing to put themselves in a position where they can't afford to be wrong will end up being wrong on a percentage basis that correlates quite well with the losing percentages of gamblers.
Your response: Interesting, but I find it hard to believe there is actual research on this. If you are talking about speculators who day trade or play options you are right. If you talk about one who invests disproportionately in one stock and holds it, I would be surprised by those results.
Wow, you really do believe everything MUST be supported by audited numbers LOL. Not for one second did I think you would take my comment as anything but a guess and assertion. Who in their right mind would ever take the time to conduct such "actual research" leaving aside the difficulty of doing so. To prove what? That addiction comes in many flavors. FWIW the above assertion comes from someone who spent 25 years rubbing elbows with investors of all types and who knows all to well how risky an imprudent investment style it can be. As I said it is your money and you sure don't owe me an explanation about how you invest it. But I've seen way too many lives ruined by folks who bet the farm on one stock and held it for me to worry too much about pinpointing whether they or traditional gamblers have a higher percentage that suffer such a fate.
I disagree. I'll take a company with solid tangibles and weak intangibles over the reverse every time.
Let me get this straight. You can't afford to be wrong but you are willing to bet the farm on a company that has solid tangibles and weak intangibles! Seems to me you can only afford to invest all of your money in a company that is strong in both areas and that your "constant analysis" would be focused on finding such a company. BTW, do you know of a company that has solid intangibles and weak intangibles because I don't. If there is such a company I am willing to bet that the solid tangibles were preceded by, and are a direct result of, solid intangibles at an earlier point in the company's history. Furthermore, I would also be willing to bet that the strong tangibles will not remain that way for long if the weak intangibles are not corrected. Like it or not, admit or not, but IMO your retirement rests solely in the intangibles of the of one WM. If he doesn't have strong tangibles I don't care how strong IDCC's patent portfolio is this company will not come even close to reaching its full potential. IDCC has had a long history of failure of the intangibles and of that WS is very cognizant. The early returns on WM's intangibles are very good, but make no mistake about it it is he who is causing them to give strong consideration to buying and who will also be trying to keep their fingers off the sell buttons.
Regards,
Danny
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