12-08-2021, 11:11 AM
(12-07-2021, 07:14 PM)fenders53 Wrote: I agree with all of those principles. A few random thoughts of mine.
-For most of my investing career I was doing a combination of index investing and DGI investing, although I didn't know the DGI strategy actually had a name.
-When I joined this forum and others, I ran into what I considered a lot of "stock collectors". I fell into the trap for a time. IMO if you don't have time to properly research a stock prior to owning a substantial position, then you are asking for underperformance. Subsequently you need to give them a review at least annually. Patience is good but I don't believe in blind faith because a company used to be good is better than index investing. It's inferior IMO. Personally I can only watch 20 tickers and it's only because I enjoy this. Add some index to this and I believe it's the best I can do.
-Margin of safety has been tough to come by lately, but I try to remain invested enough. I am seemingly the forum bear because I will not buy much if any if it's overvalued IMO. Are the rules really different now? Is a 4.0 PEG now OK just because it's been working lately? The evidence says I'm wrong for now.
-I won't be writing any investing books but one of the basic rules that has served me well is this..... Never do today what you wish you had done last week, month, year etc. You have to know when to let it go. Maybe you get another chance later and if not don't obsess on a particular company you missed the chance to buy or sell.
My "rule" - I put this in quotes because every rule I've had has at one point in time or other turned into a guideline - was to only have enough companies where I could at least do in-depth investigation into it before buying, generally follow it on an ongoing basis, read through the quarterly ERs and call transcripts and read through the AR. With each 5 I added I asked myself if I still had time and had never said no.
The most companies I ever reached was, IIRC, 33 and I was OK going to 35. I have 30 now. I've seen people with a hundred and wondered how in the world they could track them.
One other thing I did going into retirement. I had a few stocks I called "onesies." My initial purchase of a stock is always $5k. I actually moved my retirement up a year this spring so I didn't have time to add onto some companies I initially bought in late 2020 or early this year. None of them were fantastic - to me anyway, otherwise I'd have bought more. But a couple were solid such as DUK and JNJ. They were all trading above my target price when I decided it was time to get serious about this.
So I sold them. I won't be adding money or reinvesting dividends in the taxable account so they were going to stay onesies forever. I decided the positions were small enough that once I retired I didn't want to mess with them. Just wasn't worth the time.
I believe this is the longest blog post I ever wrote on Seeking Alpha but if anyone is REALLY bored and wants to see my buying process for dividend-payers, it's here: https://seekingalpha.com/instablog/48196...-companies