take over, page-5

mm55mm and all hotcopper - ITE compatriots:

I have sat back, read, observed and taken in all posts relating to ITE. It's quite amusing to see how the sentiment has changed over time. At the moment 'worry' seems to be setting in on most investors. Perhaps these are investors, that puchased one or two weeks ago in the hope of a few positive announcements and rapid share price appreciation, leading to "quick-profits". Well this is not how I invest and it's comforting to know the likes of Robbo, UL, AA and a few others think the same.

"Wait for the odds to be in your favour and then bet big - really big".

This is what Buffet eludes to and well, I really don't know why people don't take more from arguably the most succesful investor (not trader) of our time.

Investing and trading is a psychological game. The market doesn't have feeling, nor does it like or dislike you at times. It doesn't care about how much money you acquire or lose. It's nothing more than a playground faciliting trade between us.

It's rather the mind games and heuristic-driven biases we create for ourselves that really lead to our success or failure as an investor or trader. Myopic loss aversion is just one example that comes to mind and one that I believe many are exhibiting in their behaviour right now.

Myopia refers to the frequency with which you evaluate your position. This should be strongly correlated with your investment horizon.

Loss aversion refers to the fact that we all value losses more than gains. The ratio is approximately 2:1, such that the disutility of losing $50 is equivalent to the satisfaction of winning $100.

Adding these two concepts together and you get, what I am reading on the ITE hotcopper posts now! People evaluating their positions more frequently and being off-put by the fact the share price has dwindled down a little.

If you really believe this is a solid investment then evaluate your position frequently, but not so frequently that it could potentially cause you to sell! You have to sometimes separate yourself from the share price. If it means walking away from the compute then do it! Remeber why you invested in ITE in the first place because it's got something that its competitors don't have and something the market wants.

Patience pays and those that stick around will be rewarded.