What to Do


A wise reader sent me an interesting reply to my message "Stock Trends Down" (see this at http://www.garyascott.com/archives/2004/05/12/1044/index.html)

Here is what he shared.

"Gary, You really don’t like stocks do you? Crashes do not matter to long-term investors, IF you own the right

companies.

"Yesterday I read a story about Walgreens, and then looked at the chart from 1985. It was about $1 a share in 1985, rising to over $30 today. You could hardly tell that the 'Big Crash' of 1987 had any impact on the long-term success of this company. Not too many people were patient enough to hold it for 20 years, preferring to seek

short-term trading gains, and missing the big picture over the long–term. Anyway, didn't buy any Walgreens this week, but I did buy more Berkshire Hathaway on the dip."

My reply touches on a key to accumulating wealth.

"Richard, Thanks for your thoughts. I could not agree more Though I do not hide the fact that I am partial to small businesses and real estate I always make it clear that all investors should do the thing they know and like best."

(I have written about this in detail at

http://www.garyascott.com/archives/2000/02/02/55/index.html)

Have you ever met an investor who seems to make money with just about every share they buy? I have and I am delighted for them. When I investigate the cause of their success, I find hard work, an analytical mind, and lots of dedication to charts, balance sheets and such. They enforce their feel for the market with hard work!

But this is not me. Sure I have a few shares and have done well with some, but I love riding around looking at land and hiking properties, but hate reading balance sheets. I love renovating houses and I love making deals and writing advertisements and seeing them work. So it is not surprising that I've done well in real estate and business, not so much in shares. There is more about this at http://www.garyascott.com/lostprovince/203/index.html

I have invested in many stocks and agree with this reader about holding good shares, but I do not let stock picking detract from doing what I am good at and love to do. So real estate and business get the lion’s share of my time.

I also do not like market timing and investing in the market just because it is hot. I was clear about this in the stock trending down message when I wrote:

"You will see in many messages at this site that show I do not believe much in market timing. Just because the market is crashing does not mean you should exit good equity positions in a well-planned portfolio. However if you have just been enjoying a loft ride in a heady market, beware. The Dow could be headed to 8,800."

So do what you love. Do what you will feel good about at the end of the day and make two profits, the important one in your heart and given the grace of God some in the wallet as well.

Regards,
Gary


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