Hands down, the most frustrating aspect of investing for me is buying into a solid, proverbial gold mine, only to discover that the current shareholder base are conviction-less cowards tripping over themselves to undermine what’s in the company’s best interests.
Unfortunately, it’s these very situations that tend to prove the most profitable, because there’s a never ending shortage of frightened shares coming to market, which can be scooped up over prolonged periods of time for bottom-low prices.
When I find myself in positions where I have no spare cash, though, these deserters shaking my boat are a source of furry.
Take for instance, BAS. The stock cannot seem to find its legs, because every time it makes a push over $12, a flood of sell orders comes from somewhere in the backfield. Why? Oh well because shareholders are just so worried about the next quarter of numbers.
Here’s the thing. We already know how the next quarter of numbers will look – awful. And the stock’s still cheap. Now shut up, calm down, and grow a back bone.
Another keen example would be CCJ. The stock gets blasted every few months by a wave of fleeing children masquerading as shareholders, because the uranium market has not instantly completely recovered. Comically, we’ve hit the point where every analysis on uranium is finally admitting that it’s way undervalued and due for a strong rebound.
So what’s the problem? Oh, well “when” that rebound occurs could be this year, or sometime over the next several.
Am I missing something here? The rebound is going to double uranium miners, at least. Most of you fund managers are lucky to average 5% annually. What’s the problem here?
I’m going to end my morning rant on that note. The summary is: a stock’s biggest threat usually comes from within, by double-dealing company owners trying to outsmart the rest of the company stock, usually to their incompetent failings.