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Teacherman1 (62.19)

The Best Stock I Never Bought.

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October 23, 2009 – Comments (4) | RELATED TICKERS: TIN.DL

Back in March, when I was looking at and buying stocks that had totally cratered, I let negative opinion lead me to making ( or more accurately not making) a decision to buy a company headquartered in my own hometown.

It was priced below $3.00 at the time, down from $18.00, and could you imagine, paying a $.40 dividend. That was about 13% at the time.

I looked at it time and again, knew the history of the company, and should have understood it was just the "mass hysteria" of the market that had it beaten down.

There were negative comments from alalysts, and other various "pundificators", that said they might not even survive.

I just could not get myself to "pull the trigger".

As I watched it start to rise, I just could not shake off the negative thoughts that had been planted in my head.

When it doubled, then tripled, I told myself, ok, you missed it. It's too late now. Better an opportunity loss than a real life loss.

Today it is up 500% from when I "almost" bought it.

What I failed to do, and have since learned to do, is look at the long term, not what is happening in the moment.

That stock was Temple-Inland.

I have vowed that if I decide not to buy a stock, it will be based on my own analysis and opinion of what the future prospects of the company are, not on what I see and read on the web.

I am sure I will make mistakes using this method, but they will at least be my mistakes, and based on my own judgement, and not the opinion of others.

I do value the opinions expressed in CAPS and by others, but I use that as a starting point to do my own DD, and come to my own decision,not letting myself get led astray by either too much optimisim, or too much negativisim.

Just thought I would share something about stocks instead of the coming demise of Western Civilization that seems to be so prevalant in the blogs these days.

Have a good weekend and happy investing. 

4 Comments – Post Your Own

#1) On October 23, 2009 at 8:01 PM, Seano67 (41.26) wrote:

I just could not get myself to "pull the trigger".

 

Yeah, I got very reluctant too. I was really, really skittish after what had taken place in Oct. and Nov. 2008, and then just almost sickened by what took place in Jan. and Feb. 2009. I held onto everything right through the crash, and of course got killed by doing that. I don't know what the hell I was thinking there, but I guess I just kept thinking things were gonna turn around, they're gonna turn around, they're gonna turn around- and of course they didn't, and then things just snowballed from that point, and the losses compounded so quickly that I became stuck, because I was not willing to sell anything at such great loss, or at any loss at all.

And then there was that little holiday rally, ya know. Things started looking looking on the up again, and I could finally breathe a breath and feel a little better about things and be able to look at my portfolio every day and not feel as if I'd been personally violated. But of course it was a total sucker rally, and then Jan. and Feb. hit, and that's when things just started snowballing downward again, and it was so relentless, just day after day after day. And that was the lowest point I have ever been at as an investor, and that was the point at which I officially capitulated and just became so angry and disgusted about it all that I just basically said f*** it.

It was just feeling that moment of hope from back in December, that little head fake of hope,  and then to have the legs cut right out from under ya again as the new year hit and you're plunged right back into the abyss. It made it all seem that much more cruel, and that was very difficult emotionally for me to handle, and I became pretty embittered by it all, and angry with myself most of all for being so damn stubborn and stupid.

So I wasn't ready to start buying in March, or April, or even most of May, and of course I regret missing the bulk of that great run. But that was just where I was at at that time. I was in a negative state brought about by my own negative experiences and the prevailing negativity everywhere around us, here on the Motley Fool, all over the media, everywhere. 

So very long story short, great post. I'm sure that almost everyone has multiple stories of misses similar to that, because almost everyone missed the bottom. Only a few brave Fools ***cough checklist34, awallejr***  that I know of here continued to be bullish long term and buy beaten down stocks in those darkest of periods, andI know those guys and gals all did very well for themselves.

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#2) On October 25, 2009 at 2:15 PM, meganchip (87.39) wrote:

I just mentioned on my blog post how much I liked this one of yours. Believing in yourself and controlling the reaction to the emotion (or lack of emotion) of the crowd is a huge hurdle for me.

I am having a few revelatory moments like when I recently decided to stick with an ETF I had despite a big loss in value rather than bail. I am just positive that it is on its way back and is worth buying in even more. Positive but had no reinforcement so despite my gut feeling, I haven't bought more  ...  and then out of the blue (after reading/hearing nothing on it for months) I hear it mentioned on a stock show as a great pick.

This makes me think - eh, maybe I'm not so much of an idiot actually... maybe? Either that or all of the experts don't really know more than I can figure out ... toss up.

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#3) On October 25, 2009 at 2:56 PM, dibble905 (87.78) wrote:

meganchip,
there are different kinds of experts.
the ones that claim to know it all and the ones that actually do.
the ones that tell the truth as they see it and those that have a separate agenda.
there are experts out there that do actually know what they are talking about and tell the truth. the question is, which ones are they? in my opinion, it is very difficult to tell. and even if the logic seems flawless, reality is a different ball game.

information overload, my friend. there are so many truths and lies out there, we just don't know how to distinguish them.

bottom line: you should listen to others, but that doesn't mean you should take their course of action. do your own homework and plan your own course of action.

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#4) On October 25, 2009 at 3:44 PM, Teacherman1 (62.19) wrote:

Not a Saint, Megan, just old and patient.

You will do fine, of that I have no doubt. 

Dibble, congrats on you share score, very impressive, but you have so many stocks in your picks it is hard to tell which ones you picked because you really believe in them and which just to increase your CAPS score.

Not critizing or faulting, but when I look at someones CAPS picks, I would like to know what they think of a company, why, and how strongly they feel about their choice.

All of my picks are real money, real world holdings, and I usually try to give my reasoning behind them, and to update as things change.

I am behind on some of my Dry Bulk shippers because I have been very busy recently, but I did make general comments in a blog.

I am very strong on this sector in the long run.

I don't think most people realize most of these companies have not been around that long, and have a lot of room to grow. They are cylical, and when they get near what I consider the top, I will sell some. Then when they get back down, I will buy more. Unless, of course, something fundamental changes in the meantime.

Again, good score and good share score. The share score is the one I am always most interested in.

Good luck with your real life investments. 

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