This sentiment in the Zoom thread sparked a key thought for me: At this point all of this information and the different reductions in a previously maximum conviction company has me confused. True, Zoom is currently my worst investment ever, since I started very “late”, averaging down from a much higher cost basis and am now in the red.
Even if I’m not in the same space as RevTK on this mentally, I am financially: I was also late to ZM and it’s my only “red” holding right now. The key thought relates back to something that was extremely foundational to my identity as a Fool, going back nearly 20 years. I was religious then and had small children, and the importance of whether one “builds one’s house on rock or on sand”, false dichotomy as it is, was central to me (I’m also a civil engineer, so it made some literal sense too). The concept applies to one’s faith just as it does to nearly any aspect of life, and investing is surely one. In turn, I believe two keys to building on a solid foundation are these: Know what you don’t know and It might take longer than you think it will.
I spent the first decade (well, slightly less) of my investing ‘career’ learning on the fly, trying a couple of TMF newsletters and investing in a diversified mix of mostly conservative or not well-led companies, and didn’t make much money (Ford, Westport, Activision, 3D Systems, a few REITs, bleh). That learning was the foundation for what came next: In the second decade (slightly more) I got serious, became a much more avid reader, and concentrated more on tech. There I found a whole lot of success LTBH-ing such companies as Apple, Netflix, Amazon, NVidia, and as a recession rebounder, Intuitive Surgical, a position that later morphed over to Tesla.
Now I’m just climbing into my third decade with a renewed understanding of what “conviction” looks like. I’ve just about crushed my original modest investing goals and could probably retire now, in my 40s, if I had to, but I still have a lot to learn, and I want to do it focusing even tighter on SaaS and the ad market. Point is, I think conviction is more than just confidence, or at least it should be. Maybe conviction conveys confidence. In the context of investing I believe conviction should be built on a solid foundation of experience and knowledge in order to support solid performance. That experience doesn’t have to take 20 years to build (I’m pretty slow on the uptake), but I believe this: the perspective of history is what anchors the ability to understand the present well enough to take advantage of the future. (I might have just made that up)
You (meaning anyone) can’t be old without being new at some point, and there’s a lot more TMF perspective and wisdom to take advantage of now (especially here) than there was 20 years ago. Don’t beat yourself up too hard over the short term performance of a company or sector in a volatile time (I know I did, back in 2001). Someone new to investing and reading the Saul’s board has probably jumped into the deep end of the investing pool, but if you put in the work, your learning curve will be a lot steeper than mine was and your returns will almost surely reflect that. Without implying that lots of trading is better, I’ll end with another saying, this one definitely not original: “It’s good to be on the right track, but you’ll get run over if you just sit there.” : )
-n8 (holdings at profile)