The Spirit of 3 Stocks on Fire

[Dory99]

Hi David,

  Thanks for your response. I remain a strong advocate of the "averaging up" technique, in large measure (a) because it works for me and (b) I was losing my shirt before I adopted it; however, you're right, it does mean a larger percentage of my portfolio will ultimately be placed in a smaller number of stocks. I'm willing to take that risk, but I can certainly see the other point of view.

As far as the 25% trailing stop, I'm not as deeply wed to that idea. I've been lucky ( so far ) that two of my biggest winners, ISRG and UPL, have not hit the trailing stop, but they've certainly been close. I'm sure you're right about the big gainers going lower than 25%...I'm just TERRIBLE at exiting stocks.. always open to new ideas.

As I mentioned, I love the site and the work that you do and really enjoy your posts.

I'm not sure whether you've ever considered ISRG, but I feel that it's a company ( and stock ) with a bright  future.

Best wishes,

Dory99

[Michael]

....... since I can only have 10 stocks held for the long term, why bother owning some that are «not so great»? They will give me a lot of work to find and update, and not so great returns ... I'm not thinking of buying «undervalued» stocks, given the traditional ratios like P/E, P/S, etc. I want companies where I can understand the business and I clearly see it growing over time, in good or bad economic conditions (if management isn't too bad).

You didn't comment on DIET, what do you think of it? With the new food delivery program (started January 5th), already growing revenues may explode on the upside over the coming quarters ... I just think it is your kind of play, am I wrong?

Thanks for your help Michael 

No You are certainly not wrong! Diet is a great story stock and I will be there at any weakness. I think that the phenomenal run since the Odyssey appeal to management might be a bit stretched and that there might be a better entry point later (but until now I have been wrong!!!)

Another one of your recent picks that I love and will buy today is ANGN.

I do however not think that any of them will increase 10000%. The problem with stocks with that kind of potential is that they normally carry a huge risk so I set out on my personal crusade to find the ultimate LTOF stock and came up with NVEC.

Their existing business is quite healthy and the valuation is reasonable. It certainly has the potential to increase 10000% if not more. It might be too early to qualify for LTOF but give it a little time and I think you will have the leader of the board!

Mike