staying 100% invested

Saul,

I know you stay 100% invested, my question, which I don’t remember reading anywhere, is when you sell out of a major position (or any size for that matter), how long is it typically for you to get that money reinvested in the market?

Is it just a couple days, maybe a couple weeks, or could it take months? I’m sure it can vary depending on your conviction of available opportunities, but what would you say the average is?

Saul, I know you stay 100% invested, my question, which I don’t remember reading anywhere, is when you sell out of a major position (or any size for that matter), how long is it typically for you to get that money reinvested in the market? Is it just a couple days, maybe a couple weeks, or could it take months? I’m sure it can vary depending on your conviction of available opportunities, but what would you say the average is?

Hi Foodles, I don’t know on average, but this time it was two or three weeks because I had had a lot of money in BOFI and I didn’t want to just throw it indiscriminately. Also I was keeping some money aside in case I wanted to reinvest some into BOFI if it didn’t seem it was crashing further, which indeed I had started to do.
Saul

Also I was keeping some money aside in case I wanted to reinvest some into BOFI if it didn’t seem it was crashing further, which indeed I had started to do.

Saul,

If I can ask, what got you to begin to add to your position again? You seemed pretty resolute in your feelings towards the BOFI CEO a couple of weeks ago, about not trusting him and not liking the vibe you were getting from him. What changed in your feelings towards him in the last two weeks that had you reinvesting back in the position?

Thanks,
Fletch

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Saul, If I can ask, what got you to begin to add to your position again? You seemed pretty resolute in your feelings towards the BOFI CEO a couple of weeks ago, about not trusting him and not liking the vibe you were getting from him. What changed in your feelings towards him in the last two weeks that had you reinvesting back in the position?
Thanks,
Fletch

Hi Fletch, well you know I had had a big position in BOFI. It was one of my favorites. I had warm fuzzy feelings for it. Then when it fell, this last time, forty dollars in one day, and the CEO seemed so off the wall, and not answering all the questions, I started to seriously worry. So, when it bounced up to $118 or $119, I started to sell in the pre-market and got out of about 60% at an average price of $114, and the rest at roughly $104 or so as I remember, for an overall average price of about $110. But I was selling not to buy back cheaper, but to limit my risk. I still have post-traumatic stress syndrome from some of those very trustworthy Chinese companies that MF global Gains kept touting, and they went and met the CEO’s etc, and they all turned out to be crooked, and this started to have the same feeling. I wanted to be sure that the price didn’t just keep going down and down. When it was $92 or $93, I decided that if it closed over $100 or so, I’d start to nibble, and keep building if it kept going up. Also because I’d liked the company so much. I had gotten back to about a 1% position (which is tiny for me) in the last couple of days, and then this thing came along where they were changing what they actually said in real life when they reported to the SEC (especially when they said in the conference call that “there is no investigation ongoing” and then erased that in what they reported, I thought it was significant (although it may not be at all), and I said to myself “There are other good companies out there that don’t have this mess. I don’t need this.” I hope this answers your question. I certainly don’t feel the same way about management as I did before all this hit the fan.

Best

Saul

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“…But I was selling not to buy back cheaper, but to limit my risk.”

Saul: so you sold everything- ~>15% of your portfolio to 0% then to limit your risk? It must have been a very risky investment to start with if you really think that one conference call can make you change your view of it 180deg. in a matter of a couple of days. I would have thought limiting risk might mean maybe taking your 15% in BOFI down to a few %. The fact that you sold everything means maybe that you did not assess the risk as well as you thought you did?

and you bought in again after a few days…did you feel you might miss another ride up?

"Also because I’d liked the company so much. I had gotten back to about a 1% position (which is tiny for me) in the last couple of days, and then this thing came along where they were changing what they actually said in real life when they reported to the SEC (especially when they said in the conference call that “there is no investigation ongoing” and then erased that in what they reported, I thought it was significant (although it may not be at all), and I said to myself “There are other good companies out there that don’t have this mess. I don’t need this.”

why did you buy back in? then another con-call and another change in view- just like that.
so did you again sell that 1% you bought back on Friday?

sell…buy…sell…All that in less than a couple of week.
Aren’t you eager to get back in? It may be much much higher in a year or two. Sure they are other opportunities but this one is right in front of you. Could be huge.

…or it could be a total loss… who knows?
The lucky ones will tell the unlucky ones how to do what they did.

tj

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Hi tj,
Please don’t be hard on Saul about BOFI … look back at all the discussion about the current state of BOFI.
I think you will agree that corporate fraud I’d impossible to detect until it is revealed … I should say “alleged” until proven.
BOFI, as Saul states, and my 2014 profits affirm, “was” a great investment with exceptional prospects … but possibly that has changed.
Things change and I am glad we also can change our position.

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That’s called “modified buy and hold”.

:slight_smile:

Why so much angst over someone selling a stock and changing their mind? Isn’t it better to say “I think I’m wrong” at a smaller loss and focus capital and energy somewhere where you think you are right?

Sure you can say “It could be huge,” but so can a lottery ticket. Often the ones that could be huge end up being losers

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The lucky ones will tell the unlucky ones how to do what they did.

tj,

That’s where I think that you don’t understand this board. This is a public/free board where Saul and a group of his “friends” discuss their investing ideas. It is not a paid service within TMF where formal recommendations are made and tracked. Neither Saul nor anybody else here has any obligation to “tell” anybody what they’ve done because there is no official investing advice being offered, even if at times it may sound like that, either in actuality or merely in the eyes of the reader.

I don’t follow any of the ideas here explicitly, but they do provide me with food for thought. I read the boards of many different pay/subscription Fool services. For me, it’s information overload, and I only invest in a very small portion of all Fool-wide recommendations. The information on this board is just one more input into my decision-making process for what to do, which does not include following any one source’s ideas to the letter.

I think that if people here could just get their heads around what this board is (and far more importantly, what it is not), and don’t try to use it like a free investment recommendation service (which it is not), there would be far, far fewer concerns. Maybe I’m being naive to think that it won’t automatically be perceived that way by some people?

as always, i am full of carp

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and you bought in again after a few days…did you feel you might miss another ride up?..why did you buy back in? then another con-call and another change in view- just like that…so did you again sell that 1% you bought back on Friday?..sell…buy…sell…All that in less than a couple of week…Aren’t you eager to get back in? It may be much much higher in a year or two. Sure they are other opportunities but this one is right in front of you. Could be huge…or it could be a total loss… who knows?..The lucky ones will tell the unlucky ones how to do what they did.

tj, let me echo what fullofcarp just wrote. This board is clearly labeled as “Saul’s Investing Discussions”. It’s free. It’s meant for civil discussion of investments, not mocking other’s decisions. If you don’t want to be here you don’t have to stay. Really. There’s no reason for you to stay on the board if you are so dissatisfied.

I usually do not talk about my trades until my end of the month summary, but I felt a sense of responsibility to other members of the board who might have been influenced to take positions in BOFI by my having it as one of my largest positions (in spite of my exhortations for people to do their own research and make their own decisions). I therefore expressed my concern and made it clear that I was out of BOFI.

As you know, the post you were referring to was my answer to Fletch, a MF “friend”, who asked me out of curiosity what had caused me to change my mind. Out of courtesy and friendship I tried to explain to him the sequence of events which had influenced me. I’m sorry you found it so laughable, but if that’s what you feel, there’s no reason for you to stay here. That’s not what this board is about.

Saul

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Sounds like TJ was left holding the bag on BOFI and is a little bitter…

“That’s where I think that you don’t understand this board. This is a public/free board where Saul and a group of his “friends” discuss their investing ideas. It is not a paid service within TMF where formal recommendations are made and tracked. Neither Saul nor anybody else here has any obligation to “tell” anybody what they’ve done because there is no official investing advice being offered, even if at times it may sound like that, either in actuality or merely in the eyes of the reader.”

That is understood. I don’t think I’ve ever questioned that. But this is a discussion board-it being free or not has nothing to do with it, right? I am only trying to follow the train of thoughts that led to such or such decisions by asking questions.

tj

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Saul- this is not meant to be mocking. Those are questions.
You certainly do not need to tell everyone the trades you do. I get that and I am definitely not asking you to.

But you mentioned them so I wanted know more about how you deal with such a situation and how you come to the decision you come to. That’s all.

If you feel you responded already and have nothing to add then this ends here.

tj

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I wanted know more about how you deal with such a situation and how you come to the decision you come to. That’s all. If you feel you responded already and have nothing to add then this ends here. tj

That’s fair. Sounds good to me.
Saul

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tj, you might want to go back and re-read your original post. I found it quite edgy, not merely curious.

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I have found when someone is asking for themselves, they seem to be ridiculed on this site, and the paid site. People are not on the boards to be publicly humiliated and then shown the door.

If the person who started this asked the question, was a serious question that you did not like, why show them the door?

If this person was a professional investor they would not be on the board.

As I am reading, this person was asking you a serious, “why”

There are a lot of people to intimidated to join the boards or post a question due to responses like this.

We are not here to be made a fool of or escorted out the door and ganged up on.

This is how you scare others away from posting, and asking. We don’t learn by your method in this post, you scare us away out of fear to look a fool or the quiet kid in the back of the class to afraid to raise their hand. shame.

VERY LONG STANDING FOOL MEMBER…

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Java2645

Java you are right except perhaps take a minute to scan the posts of the OP over the last couple of weeks.There is definitely a mocking and somewhat antagonizing tone to a lot of the questions that the OP has asked and I think this was just the “straw that broke” question. In general I have found this board to be really supportive of questions however this OP does seem to have an edge or an agenda or both and hence the tone in some of the replies.

No one has to pay homage to Saul or any of the amazing people on this board but at the same time antagonizing posts aimed at Saul and others are not OK

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The lucky ones will tell the unlucky ones how to do what they did.

There is a group of people who attribute success in the market to luck. One argument they use, and it’s a very old one, is about a large number of people flipping coins. With each flip you have to call it heads or tails. If you are wrong you are out of the game. After a number of turns only a handful of “coin flipping champions” are left. They might think they are skillful but in truth they were just lucky.

Warren Buffett got tired of this nonsense and wrote The Superinvestors of Graham-and-Doddsville. I highly recommend it:

http://www8.gsb.columbia.edu/alumni/news/superinvestors

Denny Schlesinger

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BTW, if you consider cash a “position,” which I now do, you are automatically always fully invested. LOL

Cash is a simple and inexpensive way of hedging uncertainty as well as the risk of lost opportunity.

Denny Schlesinger

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