Some Thoughts from Seattle

The difference in the short term tax on that $20 profit and the long term tax might be about $4.00. Should I risk the entire $120, keeping it in a stock I’m worried about, because I’m worried about $4 in taxes? When the stock could easily drop more than that in a week? When I could redeploy the money in something I prefer? I don’t think so.

Saul, I too am learning this the hard way - worrying about a tax implication for a short term sale. Tonight Oracle reported abysmal earnings and saw its stock sink 3.00 in after hours. I have the stock and flagged it for sale after evaluating it with your criteria. However, a portion of the position was acquired last October and I thought I may as well hold it until it all moves to long term.

Boy was I wrong. Now instead of a gain the short term portion is going to turn into a loss.

Good advise to those who heed it. Thank you Saul.

Best,
–Kevin

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a couple of things i’m learning that i anticipate will make a difference in the long haul:

don’t invest in story stocks, no matter how great the story is.

don’t invest in companies bleeding money, there are too many companies out there making money hand over fist, invest in them.

avoid Chinese companies, too much shenanigans with the books.

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To which I might add, “don’t make simple rules because one is likely to miss a lot of great opportunities that way.”

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Always have admired TMF’s attempt at transparency.

Real-Money Portfolios
The Motley Fool’s real money portfolios that are included in this table are Million Dollar Portfolio’s Charter Portfolio and Motley Fool Pro. The total return is calculated using a time-weighted rate-of-return formula. The returns of the individual stocks are calculated using a simple average, excluding dividends. Dividends are included for both the total portfolio return and the benchmark, the S&P 500 Total Return Index.

Apparently one is beating the benchmark they use and one is underperforming the benchmark, as far as I can see. So many pundits and analysts seem to be held to zero accountability for their performance by business reporting and the like. At least the Motley Fool puts the numbers up there on the front page and always have for their portfolios. The gigantic winners at AOL and AMZN in the old portfolios.

It’s bad enough that CEOs like GE’s Jeff Immelt are held accountable for nothing over fifteen years despite terrible shareholder returns on that great collection of assets. It seems especially irritating when an advisor or stock picker is not completely transparent despite the fees. TMF has always been good about the transparency.

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