Replies to post #108221 on Biotech Values

[vinmantoo]

Dew,

<I sold out of all stocks in 2007 and went to cash, bought back in 2009 pretty near the bottom…>


{{{You and 95% of the people who post on investment message boards.}}}


Now that was funny, but don't you see that it makes perfect sense. These message board geniuses all sold near the top in 2007, and that caused the big market decline. Then they all bought back in at the bottom in 2009, so of course all that buying drove the stock market higher. It really is so simple. Of course it depends what stocks they bought back into in 2009, and how they performed since buying them, but why bother them with details.

[BTH]

Just because you didn't do it, doesn't make it a fact that this poster is lying.

[DragonBits]

HaHa, didn't realize there were so many smart people posting on investment boards.

Partially I got lucky, partially it was experience. Luck plays a big part at times.

The market started to bounce around 200-500 points a day, I knew this was bad, so I started to actively trade these mutual funds. The company complained to me that I can't do that, I needed to stay in for the long term, and they were going to limit the number of round trips I could do.

Earlier the so-called advisor that sold these funds (Waddell & Reed) was also my mothers advisor, in ~2006 his advice to her was to take a mortgage out on her house and invest the proceeds in their equity funds. Tax considerations and all that bunk. I thought that was nuts, and it scared me that a fiduciary advisor would suggest such a gamble to someone who is retired. So I stared to take a more active roll.

I got out for good and went to cash during 2007.

Once I got out, I never wanted to get back in because of the round trip limitation, and how fast the marekt was moving. Eventually in early 2009 I moved all the funds out of mutual funds (it was all cash, but still in funds).

So I started to buy with the cash in March of 2009. I did buy calls in Lehman brothers, didn't think they would let that one blow up. I bought calls because I wasn’t sure and wanted to limit my risk. It did scare me that so many companies were blowing up, but I also recalled reading stories about those that bought during the great depression, and how well they did if they bought at the bottom.

If I was really smart, I would have bought all leaps on stocks, if I had done that I wouldn’t bother with the market at all, I figured out I would be up 20 million even by July. I kick myself for being too timid.

I tell the longer story to explain how it happened to unfold, and partially it was luck.

I had a suggestion to some, post your picks on motley fool caps service , and then we can compare performance over time.

I think it actually provideds good discpline and for sure it leaves a real record. My name is BITSof1980 on that service. Right now I Rank: 3226 out of 71947, I haven't been using it for the last 4-5 months, but we could start a whole new account. It would be fun. And many of my picks are still running, all the old ones are still there in archive.

Since a lot of the gains were from me buying in 2009, it wouldnt be possible to beat me now. But I would start a whole new account to make it fair. I think you are a pretty good stock picker, so why not? Are you game, and others want to do that? I once asked vinny, he didn't care to try, but I think it actually helps one to think about the longer term since you can't trade in and out sooner than every 7 days.