Thursday, September 6, 2007

Feeling Good About the Portfolio

I think one of the most important things about a portfolio is feeling good about it. We all make bad calls on stock and ,no pun intended, we pay for it. Learning to take a loss is extremely important and unfortunately, the #1 thing people say when a stock comes down is: "I'll hold onto it until it comes back". Big Mistake. What a way to keep stale cash. The bottomline is this. Having good stocks that you really believe in is so important. Especially when the market starts to sour. For me, I have reached a point where I love it when the market takes a dump. I see sales when those days happen and I try to dig in more at a discount price.

So in the past, I have took a position in Roxio and man did I ever get burned on that one. It's been so good until recently however when you take a bad loss, you need to re-evaluate. Unfortunately for the stock, Loopnet happened to hit 17.69 and the decision was easy, I got out of SNIC and got into LOOP. It rebounded to 18.5 and Roxio is still where it was. But the most important thing is I feel good about the portfolio. I got rid of the losers (which will in all likeliness still be losers) and picked up a winner that everyone is salivating over now. Even more important is that if it drops even more, you know I'll be getting in more.

Moral of the story. Sell when it makes sense. Buy into things you really believe in. Enough said.