Cary and thread, I don't know if you will get to read this since I am apparently on ignore, but others will at least. I feel a bit bad about the exchange we had and hope that I was not out of line with the comments I made. You come across as a straight-shooter, which is something that is to your credit, and I sent a few straight back, which seemed like the correct approach to take, although I prefer to not deviate from the win-win type of communication with all people. You are also obviously a very intelligent individual, and more than a few people here on SI have commented on you favorably. In one PM I got your success with investing in semi's/semi-equip's at SI was described as "legendary". Congratulations on that, and I mean that sincerely. I like to hear success stories, and wish everyone on this thread the very best, including you. Thanks also for sharing that information in the post you just made. I think I understand you a bit better at this point, and am sure I will be learning a few things from your posts going forward from here.
We apparently differ on the question of how to go about making money in this market. I think your type of focus on numbers is a very good way to go, but not the only way. I have no doubt that you have a lot of experience and skill with your approach. Although I work with numbers all day in my engineering career, I find tech stocks to be an area where numbers have to be taken with a big "grain of salt", so to speak. Also, there is more than one approach that one can take in the area of fundamental analysis. Tech stocks are all about new markets that are opening up, which nobody really understands that well. Therefore it is not at the top of my list of priorities to attain your level of understanding with your approach, but I do appreciate it whenever someone explains their numerical approach in detail so others can follow it. As another factor, I don't have the time that you apparently have available for this, and I think most on this thread also have "day jobs". Also, quite frankly, I find the numbers side of this a bit boring, and frustrating as well, given the almost impossible task of coming up with numbers that will be accurately predictive of either short term or long term behavior for tech stocks. One reason for this of course is the large variations that can occur in the overall PE ratio for the market, or just for tech stocks as they go into or out of favor. In a recent post I referenced a recent Barrons article which discussed this, and pointed out the huge differences of opinion among some "experts" on what the proper PE should be for the market.
Making money is my top priority, but I really want to enjoy this also. From my point of view there are many different angles on all this that are often contradictory, and also fascinating. As one example, there is the pure technical approach, which completely ignores valuation. There is the extremely simple "buy and hold" approach, which ignores market cycles and valuation as well (after purchase, in its extreme form). On average buy and hold'ers (i.e. S&P500 index fund) are beating about 75% of all mutual funds last time I checked, which are run by professionals, who often have research teams at their disposal. As one other interesting example, it is a fact that the most successful investor that I know of personally spends no time at this at all, and just simply adds to his Microsoft holdings on a regular basis, as he has done for over 10 years now. He has more money than he knows what to do with, and knows very little about how to analyze stocks, especially tech stocks. My point is there is no one "correct" approach, and that is part of the fun in this whole thing. Please keep in mind that there are other approaches for tech stock investing that also have validity, and lets try to keep this as fun as possible, because otherwise it becomes "work". I realize that many investors have been impacted quite a bit by this market decline, myself included, but my own approach is to try to stay focused positively on the situation. I think we have a lot to be grateful for here in America, and I may be wrong about this, but I think things will soon get better for our economy. I am one of those contrary types that gets more interested in buying when prices go lower, all other things being equal.
Regarding AMAT, most of us "threaders" here are now, or at least once were shareholders, so we have that in common at least. AMAT seems very solid to me, almost boring in a way because of this. I first bought AMAT near the bottom in 96 using my own unique approach. Lots of "experts" were saying to avoid it at that time. I agree that there are prices where it should be sold and bought. Exactly where these points are of course is open for debate.
Thanks again for that post, and best wishes to you, and all,
John |
