Friday, May 13, 2005

You shouldn't take my advice on stocks anymore. I missed a big opportunity by fully vesting before the GuruNet (AMEX: GRU) Q1 earnings call on Tuesday (read between the lines: I lost enough of my own money to buy two round-trip tickets to Hong Kong, complete with hotel stay). I hope you don't mind if I do a little public reflection on this poor decision as I continue to learn things the hard way.

I haven't talked about GuruNet on my blog like I have for other stocks. GuruNet was, as I told some friends, my opportunity to put my money where my mouth was and prove myself as a competent, savvy new-new-new economy investor.

So much for that idea.

By buying the stock before the quarterly numbers (my basis is around 18), I thought I could capitalize on the new profits and possibly some new analyst coverage. These were supposed to be show figures that Answers.com is a viable internet resource. So much for that, too.

The market thinks there's still some hot air to be deflated after getting blown up in February as a result of their unofficial Google partnership. That's good, I guess. We're not in bubble mentality anymore, and we're correcting ourselves quickly (albeit a correction at my loss, but still- in the big picture, that's OK).

As cliche as it sounds after any big dip, I still find this company attractive. I think it's an even better buy at these numbers. GuruNet gets it, but there's still some monetization work to do. Answers.com is really a great product, and if the site would work on my Sidekick II, things would be perfect in my little world. This drop means that my money is just going to have to work harder to make up the loss... and for the smart investor, now is an even better time to buy.

Update Pete, if you're reading this, I know you're going to remind me that dumb first-time investors with Ameritrade accounts are prone to hold onto their losses for way too long... but I plan to hold GRU until their work-out.

 
Comments:
I feel guilty now
 

If you believe your investment to be wise, than this is simply another buying opportunity. Ever since 2000, whenever any internet company comes in with light earnings the stock gets crushed... see Ebay last Q4 for an example
 

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