Broke In Canada
Posted: Wednesday Apr 2 10:31:54PM 2008
I have to agree with Doren that success in small-caps has a lot to do with timing. Like Bobwins, my greatest successes in the market have been the result of buying low p/e value small-cap stocks, as well as some intelligent speculation during bull markets (usually still buying profitable companies or using private placements to leverage good entry points in strong speculative plays). The biggest trick, in my opinion is knowing WHEN TO SELL, including getting out of the market completely to avoid the harsh downturns that can steal away years of profits in a few short months. Those who have been following my posts will know that I am near 100% cash and have been since roughly last May. As a result, my gains were modest in 2007, however, that follows several years of big returns. This cycle seems to happen every 4-5 years. I am used to it and just ride it out in cash. I am now starting to see some worthwhile value plays and am a little more keen to make some strategic purchases although my overall sentiments on the economy and stock market remain negative. There are at least some interesting short-term trading opportunities. I also agree with Bobwins and Doren that many small-caps will enjoy a period of short-term success that you can benefit from as an investor even though they never turn into a long-term success, or even survive. A great exmaple of this is ConSpace. I hade very good money on ConSpace but I sold at the right time. Same with PIH and ILI (Broke In Canada ripped me apart on this forum for buying it under $0.20 and I subsequently ran it to roughly $1.00). Management often fails to take the company to the next level or the market changes and makes their product obsolete etc. But, there is often money to be made in their initial growth cycle. Again, the trick is knowing when to sell, not falling in love with a stock, and getting out at the right time. Once in a while, you will hit a homerun and make some really serious money by finding the next "blue chip." Nobody whould ever count on these, but even one of these in a lifetime can change your financial position in a massive way. While not every company mentioned in this forum turns out to be a homerun, the intent here is for investors to share ideas and educate themselves as to different opinions ans strategies. Most of us here, including Doren share a fairly similar philosophy which at least helps us narrow our hunt for stocks. There are some really intelligent, humble investors on this forum and I enjoy their analysis, contributions, and constructive criticism even though I might not always agree with their stock picks. I have definitely profited from the collective knowledge shared on this forum. As always, best of luck to everyone.