Investing 102

[ErikLS2]

Originally Posted by GregWeld

You'll learn a lot more about yourself - and investing in general when the markets are poop -- than you ever will when the market just goes up every day.

You'll learn about time. Remember that money you were saving and "didn't need" for awhile (2 or 3 years perhaps).... You'll learn about diversity, and how one or two names in your portfolio are the only thing keeping you somewhat afloat... You'll come to understand why earning some money on your money is really important when the growth of the share price IS NOT there... You'll find you look at your portfolio a lot less in bad markets... this is especially true if you own great names... You'll come to understand all my "gambling" statements if that's what you've done...

And when it snaps (or crawls) back... you'll think how lucky (smart) you were to have been acquiring more shares all along the twisty, winding, route the market takes.

One of your best yet!

[GregWeld]

Crazy damn market... I have no words other than just to stick with it. NASDAQ UP over 100 points! WTF.... Crazy.

Here's the only thing I can say - do what I do - pick your names (the best ones!) don't get squirrelly... just buy when you are ready. Close your eyes and ride the wave.

Worst quarter in 4 years. Now you know what a ****ty market is like. Sometimes it's like this for a few years!! Stomach it - weather it - don't try to time it - just keep on investing. It ALWAYS gets better. The losers are the ones that bail.

[Sieg]

It will be interesting to see how the market reacts to the Putin tomorrow.

[ErikLS2]

What about what Carl Icahn said today? I think it's a bit extreme but he's no dummy either.

[ironworks]

Originally Posted by GregWeld

Crazy damn market... I have no words other than just to stick with it. NASDAQ UP over 100 points! WTF.... Crazy.

Here's the only thing I can say - do what I do - pick your names (the best ones!) don't get squirrelly... just buy when you are ready. Close your eyes and ride the wave.

Worst quarter in 4 years. Now you know what a ****ty market is like. Sometimes it's like this for a few years!! Stomach it - weather it - don't try to time it - just keep on investing. It ALWAYS gets better. The losers are the ones that bail.

That's good. I'm tired of seeing red every day. Then a big green day and then small red numbers for a week or 2.

[GregWeld]

Originally Posted by ErikLS2

What about what Carl Icahn said today? I think it's a bit extreme but he's no dummy either.

Erik --- I totally agree with you that Icahn is... well... an icon. I listen to him - and I pay attention. But here's where I usually go... "the market" is just so much bigger than "anyone" including the federal government. Typically the market reacts as a "group think" mechanism. Nobody is buying - everyone is buying...

What we're dealing with is group think - on China - on the rest of the world... nobody really knows what these economies are going to affect here or on US companies. We are dealing with a FED rate hike, or not. We don't know the affect of what that is going to do. We have a collapse in the oil industry... just when the US was looking to become a major oil producer and possibly even an exporter. Where's that going to shake out.

Here's the deal in the market. Lower oil prices -- bad for some - great for many... are you in the right ones? If you're in to oil - you're getting killed (I am ) - if you're into autos - you might be looking like a hero (more sales - more big profitable truck sales etc). Retail sales should look good in the fourth quarter because the consumer has more money in their pocket from the lower prices...

If you're invested into anything that is "international".... Caterpillar... etc... you're DOA... But would you really be afraid to be invested or buying more (CAT)?? This is one of the worlds premier companies. When Europe and China come back on line - you'll look like a hero owing CAT long term.

My point - same point I've always made -- buy the very best the world has to offer - get a decent dividend - buy more as you can when the world appears to be going dark. That is how you make money. Long term is not one quarter... it's time to build your portfolio not shrink it. Grow a set. You'll be happy with the result.

[ironworks]

What is your take on Snap On. They go up and down in big moves almost daily. But man it got more hammered lately then I would have thought. Are they more international then maybe I thought?

[GregWeld]

Originally Posted by ironworks

What is your take on Snap On. They go up and down in big moves almost daily. But man it got more hammered lately then I would have thought. Are they more international then maybe I thought?

They ran up pretty far - pretty fast - and their dividend is small - so you're relying on all share price growth. In a down market - or jittery market - people pull money out of where they have big gains FIRST... everyone is loathe to sell losers.

Great company - great name... the share price might have run a little too far is my guess.

[ErikLS2]

Originally Posted by ironworks

What is your take on Snap On. They go up and down in big moves almost daily. But man it got more hammered lately then I would have thought. Are they more international then maybe I thought?

I've been using the tools for 20+ years, just bought my first shares 10/20/2014 and as of today I'm still up 21%. They have the best tools, are in a lot more businesses than most are probably aware of and look at a 2 year or longer chart. They have these little blips and then keep on chugging along. Go to their website and listen to a recent conference call and you'll get a sense of the whole company. More than just tools to mechanics. This one stock showed me that once I'm aware that a company clearly without a doubt produces the best product, I should be a buyer. I will also know right away if the product starts to suck and can get out because I use them every day.

[GregWeld]

Originally Posted by ErikLS2

I've been using the tools for 20+ years, just bought my first shares 10/20/2014 and as of today I'm still up 21%. They have the best tools, are in a lot more businesses than most are probably aware of and look at a 2 year or longer chart. They have these little blips and then keep on chugging along. Go to their website and listen to a recent conference call and you'll get a sense of the whole company. More than just tools to mechanics. This one stock showed me that once I'm aware that a company clearly without a doubt produces the best product, I should be a buyer. I will also know right away if the product starts to suck and can get out because I use them every day.

Erik -- This is exactly what I've always said about buying companies that you know and understand. As a consumer - you'll be the first to see signs of cracks in the business. If you suddenly find yourself not happy with the way things are going - you'd have to assume that "others" would feel the same way... and you can start sliding out of the shares.

Obviously this is an over simplification of investing - and it's impossible to do this with every single name you'll want to own. But if you break it down for making CHOICES of which companies to invest in - and you're seeking names to put in your portfolio... then this is one more tool (pun) in your bag to help you. It's as easy as adding a financial name -- if you bank at Wells Fargo and like them - and the choice is between them and Bank of America... you'll sleep better owning WFC. Same with an oil company (that also retails gas)... or a food stock... or a retailer such as Macy's or Nordstrom. Are you a Home Depot guy or a Lowe's guy...

It's not the end all way to invest - but it is a good way to help people (newbs in particular) to get them started -- and to have them STAY IN THE GAME when the game isn't particularly fun (like now).