Breaking Your Own Rules
I think it's good for investors to have some hard-and-fast rules they're always conscious of... I've also recently been thinking that every once in a while, you need to have the flexibility to break them in the right circumstances.
I don't know if anybody's following the Rising Stars project here on Fool.com, but I've been participating. My latest buy for my portfolio is Solazyme (SZYM) -- here's the writeup.
For years I have generally derided unprofitable companies in my articles. I'm also not a huge fan of IPO fever situations; it's often an easy way for individual investors to get caught up in the euphoria and lose a good bit of money. Solazyme's still an unprofitable company, and it's an IPO. But I decided to put some money into this one as my July purchase for my portfolio. Biofuels are fascinating, and could be HUGE down the road. This company's technology sounds very compelling. Although it doesn't have a ton of revenues, it DOES have revenues. It has some big-name customers and partners already. And unlike a lot of start-ups (like biotechs generally scare the you-know-what out of me for this reason), it doesn't come out of the gate with a whole ton of debt it took on to finance its grandiose plans.
Anyway. Every once in a while it might be good to break one's own rules for some good reasons. I'm hopeful this company will be able to make good on the promise it shows. This was one of the exceptions to my rules. And of course the Rising Star project is particularly fun because we can put some money where our mouths are out in public and see what happens down the road.