SGX LongAn investor, not a trader
Tuesday, February 5, 2008
By vwig
One Bullboard member draws the line between investing and trading.
Editor’s Note: The following post by vwig appeared on the Longview Capital Partners Inc. (TSX: T.LV, Bullboard) Bullboard at 1:02pm EST on February 5. It has been edited for spelling, punctuation and grammar only, in an effort to make it easier to read. Click on the text link within the quote to view the post in its original form.
"By the way who is vwig?" I am a long term shareholder who is actually an INVESTOR... and not a trader. There are but few of us left it would seem, from what I read on the Bullboards these days, but we are a tough bunch.
You see, traders get nervous when they do not see excitement and news and sexy stuff happening every week to make their stocks go up and down. They want action and news... quick results... a rapid buck, a swift lift, you get the drift. INVESTORS on the other hand have done their due diligence extensively and they understand what it means to put together a business plan and long term strategy, and therefore they allow the management of a company its leeway to do what is necessary to grow a company to where it will reward the patience of said INVESTOR. We are able to hold without flinching, without fear... dapper and brave in the face of the movements of the herds. We stand pat, keeping our eyes open, in the hope that when the herd has stampeded past due to one more sentimental move, we can pick up some of the trampled ones who were unable to hold on.
INVESTORS do not complain unless there is something totally unethical or incomprehensible with regards to regular business practices. INVESTORS will readily accept that in the beginning there will be many traders trying to make a few pennies here and there. While this happens and the herd moves in and out of a stock, the INVESTOR will benefit from the dips and add, thereby silently and steadily enhancing the share-count that is being held by strong hands, knowing full well that he has the benefit of the fundamentals on his side.
We can be critical but constructive. We do not hype or bash, we simply observe, once and then making a comment if we see something is going awry on the Bullboard. We let the traders make some pennies and are more than willing to see our stock go up or down, sometimes 50% or more... smiling at the bargains when it goes down, often adding at the same price we initially got in at. We have no nerves to be traders, and cannot use TA for it only reflects what has happened and cannot be effectively applied to juniors, because it does not take into consideration unforeseen events. It is a self-fulfilling prophecy at best... so we tag along and buy more when the TA tells the herd to sell.
The traders sell on news, and when they are done selling we often step in and buy those units. Often traders will even make the stock go up on news, even though they don't really know what the news means. That's when you see the stock go up in the morning when the news comes out... that's the herd. They see "news," so they buy and make it go up. In the afternoon, you'll see it go down again, because someone actually figured out what the news meant. It's a funny game indeed.
Being an INVESTOR is not a stressful thing. The only stress I really have is when I have to read through too many posts of "questionable value" to find anything of "added value." I am more than willing to make the effort though. I like traders because they actually help investors to some extent. Once the strong hands have the upper hand, then the traders usually leave and move on the next short term "quest," leaving all the spoils to the INVESTOR.
Now that you know who or what I am, don't mind me. I ramble here and there but I am quite harmless... just sitting here, waiting for the plan to come together, patiently awaiting the next herd movement that will allow me to purchase more on sentiment-fueled dips.
I will admit though, that sometimes I taunt the devil by trading a very small portion of my position when I see the herd coming, blinded by its fears, scattering units here and there, while it heads for greener pastures. I'll then simply pick those units back up at a discount and throw them in my drawer with the others, lest they feel that they have been treated with less respect. In the end, we find a convenient exit strategy at the price we initially set as a goal and slowly move away unnoticed by the herd, already nipping nervously at the grass in many other fields.
Sorry for the length of this post, but I have a new keyboard and I am trying to break it in. 'Tis a lonely existence, that of an old fashioned INVESTOR, but someone has to do it.
Cheers.
This article was written by a member of the Stockhouse community.