Harry Newton's In Search of The Perfect Investment
Newton's In Search Of The Perfect Investment. Technology Investor.
AM EST Tuesday, January 16, 2007: If full planes mean
anything, the world -- or at least the Pacific -- is booming. Blessedly, I missed
The Forecasting Season, in which everyone and his uncle publishes his
guess where the world will go in 2007 and what that will mean for investing.
I read them -- from the bullish to the bearish. My conclusion? No one knows.
Which brings us to ...
Investment Rule 1: Put your money where your control is. If you control
it, invest oodles in it.
If you don't control it ...
Investment Rule 2: Diversify broadly, pray and count your blessings.
Let me explain:
is the only way to mitigate uncertainty. I have returned to a portfolio where
investments that were meant to do well in 2006 didn't and those that weren't
meant to do well did. I'll have a full report in coming days, as I assess the
damage and pleasure. So far: the big disappointments are biotech and commodities
funds. The big successes are Australian mining stocks, some great-manager hedge
funds, rent-paying real estate and Vanguard index funds.
is your biggest tool when dealing with investments that are managed by someone
else. The ultimate tool is selling out. It's often not easy getting out. There
are lock-in periods. And you have to figure timing. In 2006, I stayed with one
manager far too long. I could have lost 15%. Ultimately I lost 50% with him.
With another I got out with a 1% loss. Had I stayed in another six months, I
would have made 20%.
your blessings is critical. Losses hurt far worse than profits please. My 50%-loss
hedge fund manager is a jerk, seriously lacking in sales skills and excessively
prone to secrecy. But other good investments compensated. Count those blessings
and ignore the jerk. That's key for the psyche and the sanity. If you can't
take the regular disasters, put your money in muni bonds; go play golf.
few days, I'll assess 2006 more closely and look at 2007's allocation. Hopefully,
I'll do better in 2007 -- no disasters. But I won't. That's the nature of this
Search for the Perfect investment beast.
Fortunately, I found some more Australian mining stocks. I'll have them in the
next few days.
The pile on my desk is horrendous. The jet lag is tolerable. But I feel very
positive towards 2007. It's going to be a good year.
nice chuckle to begin the year.
Ole had a car accident. In court, the trucking company's lawyer was
questioning Ole. "Didn't you say, at the scene of the accident, 'I'm fine,'?"
Ole responded, "Vell, I'll tell you vat happened. I had just loaded my
favorite mule, Bessie, into the..."
ask for any details", the lawyer interrupted. "Just answer the question.
Did you not say, at the scene of the accident, 'I'm fine!'?"
Ole said, "Vell,
I had just got Bessie into the trailer and I was driving down the road...."
The lawyer interrupted
again and said, "Judge, I am trying to establish the fact that, at the
scene of the accident, this man told the Highway Patrolman on the scene that
he was just fine. Now several weeks after the accident he is trying to sue my
client. I believe he is a fraud. Please tell him to simply answer the question."
By this time,
the Judge was fairly interested in Ole 's answer and said to the lawyer, "I'd
like to hear what he has to say about his favorite mule, Bessie".
Ole thanked the
Judge and proceeded. "Vell as I vas saying, I had just loaded Bessie, my
favorite mule, into the trailer and vas driving her down the highway ven this
huge semi-truck and trailer ran the stop sign and smacked my truck right in
the side. I vas thrown into one ditch and Bessie vas thrown into the other.
I vas hurting, real bad and didn't vant to move. However, I could hear Bessie
moaning and groaning. I knew she was in terrible shape just by her groans. Shortly
after the accident a Highway Patrolman came on the scene. He could hear Bessie
moaning and groaning so he went over to her. After he looked at her, and saw
her fatal condition, he took out his gun and shot her between the eyes.
Then the Patrolman
came across the road, gun still in hand, looked at me and said, "How are
vould you say?"
This column is about my personal search
for the perfect investment. I don't give investment advice. For that you have
to be registered with regulatory authorities, which I am not. I am a reporter
and an investor. I make my daily column -- Monday through Friday -- freely available
for three reasons: Writing is good for sorting things out in my brain. Second,
the column is research for a book I'm writing called "In Search of the
Perfect Investment." Third, I encourage my readers to send me their
ideas, concerns and experiences. That way we can all learn together. My email
address is .
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