Howard Marks said "Everything is triple-A at the right price".
paraphrasing on it, i think you should be be more mindful of the valuations in your periodical reviews.
if investment A has tripled in price, and it is now at 100 P/E - you can sell 2/3 (== still hold long position) but reduce the risk to 0. I don't think it shows less conviction or a character flaw - but rather recognition that markets are volatile.
it's the flip side of buying more when the business you believe drops by 40%.
i think there's a contradiction between "don't buy pricey stocks" philosophy and "if you already own it and its pricey, it's ok".
of course you don't want to become a day trader, but if your asset moved to the price your valuation says it would be worth in 10 years, staying stoic is saying something about the trust you have in your valuation model.
a ship the size of BRK can't move in/ out of position without impacting the price.
if they would be able - i think they'd reduce exposure to assets in hype, and deploy the capital in other good businesses with less frothy price.
thanks for the candor of your posts.
my 2 cents:
Howard Marks said "Everything is triple-A at the right price".
paraphrasing on it, i think you should be be more mindful of the valuations in your periodical reviews.
if investment A has tripled in price, and it is now at 100 P/E - you can sell 2/3 (== still hold long position) but reduce the risk to 0. I don't think it shows less conviction or a character flaw - but rather recognition that markets are volatile.
it's the flip side of buying more when the business you believe drops by 40%.
Thanks, Daniel, for the example! That's helpful for me to start selling my more loved businesses, which sometimes trade 'richly'.
i think there's a contradiction between "don't buy pricey stocks" philosophy and "if you already own it and its pricey, it's ok".
of course you don't want to become a day trader, but if your asset moved to the price your valuation says it would be worth in 10 years, staying stoic is saying something about the trust you have in your valuation model.
a ship the size of BRK can't move in/ out of position without impacting the price.
if they would be able - i think they'd reduce exposure to assets in hype, and deploy the capital in other good businesses with less frothy price.