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Sign Me Up for Dumb and Dumber III, Or Why Did I Sell Boston Beer Co
Bummer. Happens to everyone at some point, I think. I know people who sold Priceline ages ago.
I've sold a couple of things before they were bought (Bulgari's one that comes to mind) and have managed to side-step some things (Monitise, last year, which went from "the next big thing" to ....well, lets just say, not.) Had Nike in the 60's not that long ago, thought it was overvalued. The list goes on.
Ha. How about NOT buying? Spring 2009, Ford Motor at 1.87, 20K typed into the little box sitting on the screen. Ah, screw it says I, the thing'll probably fold. Somehow "lost opportunity is a much better feeling than lost money" makes me feel a little better but beers work better
I don't think it's ADD or any of the stuff you list Maurice. Just some individual never learned to count higher than all his fingers and toes X2
Thanks for sharing your experience. Suspect that happens a lot. With me the (latest) dumb thing was my prediction the new aluminum F150 would flop due to the low gas prices. Actually, it's been a big hit. Dealers can't keep it on their lots. Go figure.
Admitting a mistake, especially a wealth robbing investment mistake, is not an easy assignment. And you guys voluntarily did it. I’m impressed.
To quote John C. Maxwell: “A man must be big enough to admit his mistakes, smart enough to profit from them, and strong enough to correct them.”
There is a positive side to making a mistake. Benjamin Franklin wisely said: “Do not fear mistakes. You will know failure. Continue to reach out.” Steve Jobs added that: “Sometimes when you innovate, you make mistakes. It is best to admit them quickly, and get on with improving your other innovations.”
I admire all your honesty and forthrightness. And it’s contagious. I want to especially thank MFOer Maurice for initiating the topic. That takes courage.
I suspect all investors, sooner rather than later, become members of the Dumb and Dumber club. I became a certified member at a very young age, and have solidified that membership over time. It never ends. But that’s okay.
Another positive aspect of disclosing club membership is that it often translates into an overall successful investing career with only a few memorable errors. There is an asymmetry here. It’s more painful to be a loser than a happy winner.
Too many mistakes usually foretell a survival failure. That hasn’t happened to MFO participants as we continue the learning process.
Possibly my biggest bomb, I recieved shares of Chipotle when it was spun off from McDonalds way back. Thinking, what am I supposed to do with a dozen shares of another burrito joint I sold them a couple of days later. What are they over $600 something these days. Oh well.
@scott: funny; I had MONIF on a watch list. What a disaster that's been.
You had a stock that attracted investors like Visa and Leon Cooperman of Omega (who is now stuck as the largest shareholder) and others. It was the "hot" thing in the payments space. They changed the business model and Visa left (they thought they could do these things "in house") Oddly, they gave via a new co-CEO that was an exec from Visa. After that, it basically went into a tailspin. There has been some discussion that they would be bought lately, but nothing's come of it. I was out at a little over a buck last year, it's now 26 cents.
"It is easy to say, "The charts told us so." In this case, however, a very knowledgeable investor, Omega Advisors, as well as some large corporations -- MasterCard (MA) , Telefonica (TEF) and Banco Santander (SAN) -- made sizeable investments in the company. These investors and partners have vast research capabilities and performed extensive due diligence prior to making a commitment to either infuse capital or build a corporate alliance and partnership with Monitise. Nearly everyone who looked under the hood moved ahead with an investment and/or a partnership.
Not one of them has been rewarded, and all have suffered large financial losses."
Another disaster that I was in a few years back was Sprott Resource Corp (SCPZF), a private equity sub-company advised by the famed parent (Sprott.) I was in and out around the $4-5 level, but the company has basically been a mess since, including a poorly advised dividend policy that lasted a short period of time. It went from $3 last August to 83 cents. I've actually thought about buying it at this point because I just don't think it'll go under because of its parent and the parent may buy it (it bought another Sprott subcompany - in 2013, Sprott bought Sprott Resource Lending), but I don't even feel like taking the risk/devoting the money.
One that hopefully won't be a disaster is Dolphin Capital Investors (DOLHF.PK), which is a property company that owns lots of beautiful real estate in Greece and Cyprus. I own a little (tiny flyer position) of that as a flyer. US hedge fund Third Point owns 20% of it. It's 35 cents a share and trades at a fraction of book value.
In the electronic payments space, TSS makes a lot of sense. Unfortunately, I did not pull the trigger when it dipped to about 28 not to long ago.
TSS looks quite interesting, thanks.
In other Monitise news, the founder departed the company yesterday, sending the stock down nearly 20% more.
So, I got out last year a bit over a buck. It's now 19 cents. I got out because I didn't want to speculate in the sector and just decided to go with FIS in terms of financial tech.
Honestly, I'm a little surprised that not more has been written about this story. I can't recall another instance recently where so many large players (both in terms of corporations and investors) have been pulled into a "story stock" only to have it go so wrong. Famed hedge fund manager Leon Cooperman got obliterated in this and still is stuck with something like 15% (edited to add: 14.9%) of the company after he bought more after Visa left.
As noted above, Doug Kass was another hedge fund in Monitise big time and has written articles about how he's given up on it. From the top 10 for Kass in December of last year, "Monitise's (MONIF) subscription adds far outpace expectations this year. (The shares double in price.)" He dumped it and gave up on it earlier this year.
The Central Bank of Norway is still stuck with 8% of the company.
I mean, obviously it's a tiny stock so those involved just moved on, but classic example of a hot stock hitting a bump and then having it just snowball out of control.
To think I was looking at it when it was at $1.50! Unfortunately, there have been other "story" stocks I failed to resist. How about the FlavrSavr tomato or Surebeam's food radiating machine?
Comments
I've sold a couple of things before they were bought (Bulgari's one that comes to mind) and have managed to side-step some things (Monitise, last year, which went from "the next big thing" to ....well, lets just say, not.) Had Nike in the 60's not that long ago, thought it was overvalued. The list goes on.
Friday there was a rumor that one company I own was going to buy another one I own (http://www.reuters.com/article/2015/03/20/us-andersons-glencore-idUSKBN0MG25O20150320). I'm sure I'll also make plenty of mistakes in the years to come.
Somehow "lost opportunity is a much better feeling than lost money" makes me feel a little better but beers work better
Thanks for sharing your experience. Suspect that happens a lot. With me the (latest) dumb thing was my prediction the new aluminum F150 would flop due to the low gas prices. Actually, it's been a big hit. Dealers can't keep it on their lots. Go figure.
All you contributors to this post are terrific.
Admitting a mistake, especially a wealth robbing investment mistake, is not an easy assignment. And you guys voluntarily did it. I’m impressed.
To quote John C. Maxwell: “A man must be big enough to admit his mistakes, smart enough to profit from them, and strong enough to correct them.”
There is a positive side to making a mistake. Benjamin Franklin wisely said: “Do not fear mistakes. You will know failure. Continue to reach out.” Steve Jobs added that: “Sometimes when you innovate, you make mistakes. It is best to admit them quickly, and get on with improving your other innovations.”
I admire all your honesty and forthrightness. And it’s contagious. I want to especially thank MFOer Maurice for initiating the topic. That takes courage.
I suspect all investors, sooner rather than later, become members of the Dumb and Dumber club. I became a certified member at a very young age, and have solidified that membership over time. It never ends. But that’s okay.
Another positive aspect of disclosing club membership is that it often translates into an overall successful investing career with only a few memorable errors. There is an asymmetry here. It’s more painful to be a loser than a happy winner.
Too many mistakes usually foretell a survival failure. That hasn’t happened to MFO participants as we continue the learning process.
Congratulations to all of us.
Best Wishes.
"It is easy to say, "The charts told us so." In this case, however, a very knowledgeable investor, Omega Advisors, as well as some large corporations -- MasterCard (MA) , Telefonica (TEF) and Banco Santander (SAN) -- made sizeable investments in the company. These investors and partners have vast research capabilities and performed extensive due diligence prior to making a commitment to either infuse capital or build a corporate alliance and partnership with Monitise. Nearly everyone who looked under the hood moved ahead with an investment and/or a partnership.
Not one of them has been rewarded, and all have suffered large financial losses."
http://www.thestreet.com/story/13019858/1/doug-kass-analyzes-a-failed-trade-a-requiem-for-monitise.html
Another disaster that I was in a few years back was Sprott Resource Corp (SCPZF), a private equity sub-company advised by the famed parent (Sprott.) I was in and out around the $4-5 level, but the company has basically been a mess since, including a poorly advised dividend policy that lasted a short period of time. It went from $3 last August to 83 cents. I've actually thought about buying it at this point because I just don't think it'll go under because of its parent and the parent may buy it (it bought another Sprott subcompany - in 2013, Sprott bought Sprott Resource Lending), but I don't even feel like taking the risk/devoting the money.
One that hopefully won't be a disaster is Dolphin Capital Investors (DOLHF.PK), which is a property company that owns lots of beautiful real estate in Greece and Cyprus. I own a little (tiny flyer position) of that as a flyer. US hedge fund Third Point owns 20% of it. It's 35 cents a share and trades at a fraction of book value.
In other Monitise news, the founder departed the company yesterday, sending the stock down nearly 20% more.
So, I got out last year a bit over a buck. It's now 19 cents. I got out because I didn't want to speculate in the sector and just decided to go with FIS in terms of financial tech.
Honestly, I'm a little surprised that not more has been written about this story. I can't recall another instance recently where so many large players (both in terms of corporations and investors) have been pulled into a "story stock" only to have it go so wrong. Famed hedge fund manager Leon Cooperman got obliterated in this and still is stuck with something like 15% (edited to add: 14.9%) of the company after he bought more after Visa left.
As noted above, Doug Kass was another hedge fund in Monitise big time and has written articles about how he's given up on it. From the top 10 for Kass in December of last year, "Monitise's (MONIF) subscription adds far outpace expectations this year. (The shares double in price.)" He dumped it and gave up on it earlier this year.
The Central Bank of Norway is still stuck with 8% of the company.
I mean, obviously it's a tiny stock so those involved just moved on, but classic example of a hot stock hitting a bump and then having it just snowball out of control.
Monitise 1year Chart:
http://finance.yahoo.com/echarts?s=MONIF+Interactive#{"range":"1y","scale":"linear","comparisons":{"^GSPC":{"color":"#cc0000","weight":1}}}