Randall, you wrote a book. Let me see if I can answer it before the next power outage. ha-ha.
Yes, staying warm. Got a gas fireplace, thankfully but power/internet goes out about every hour for an hour.
LPL carries higher debt levels than it should for its size. Therefore it carries higher risks than our average position now.
KHC did have higher debt but its market cap to debt ratio has improved. So it’s fine.
When we enter a position, that’s at a certain point in time. A year or two into the future, prices can change drastically from our entry price during that year or two. Our entries, averaging downs never change. Never. However, if you enter far lower than us, than the rule has been that you need to have your averagings all spread apart by at least 10% each.
Targets are just that. Potential for where a stock could rise to and we could sell. But where we WILL sell is always subject to the many moving factors/forces at work within the overall market and its risks. So there’s nothing static about investing. It’s constantly moving parts that require my constant (over time) reevaluation.
By BBBT I think you mean, BBBY. I never said don’t get into it for its cash. It was due to its debt that was then high relative to its market cap. Therefore, it was higher risk than a typical stock of ours that was not in that position. So, if one was already in it, it was fine to stay in it. But if one was thinking of starting a new position, why start into a high-debt company when you can start into a low-debt company?
Info from the original newsletter (and the portfolio section) does not change. You’re correct. at or belows, for entries. Averaging down levels are well thought-out over weekly, 10-year charts. However, if you come into at a different time than us, your entry could be much lower than ours. In that instance, you’d need your averaging downs at least 10% apart from your entry and your last averaging down.
Our exit price and what is a target can be different yet. The target (its potential to rise to a certain level) will not change. However, many factors in the market, economy, changes within the company, sector, etc. can all dictate whether we sell out earlier than that or not.
Yes, if we get unusual % returns in unusually short time frames, 9 times out of 10, we’ll be taking those. The one in 10 is when I believe there is far more reason to go, even still. That could be some fundamental force (like oil recovering from historic lows) or it could be from something I see technically on the charts. breakouts of long ranges, Elliott Wave counts, etc.
With power outages every hour, you may want to do one question at a time so that I’ve for sure got time to answer your question and others before the next outage comes about.
Thanks for your questions. Glad you’re interactive with us here on the site.