Follow Howard Lindzon: Get every new post delivered to your Inbox. Just enter your email address below and click follow.

You Can’t Fit a Railroad in the Cloud…and Buy and Hold Works!

The Dow Transports are at all-time hights today. It really is all ‘ball bearings‘.

High fives for the railroads and Warren Buffett!

Woot for the truckers!

Only the government and Post Office could screw up such a layup of a trend.  The post office only lost $15 billion last year.

Take a look at this beauty of the chart I created on Ycharts in like 5 seconds (shameless investor):

FDX Total Return Price Chart

FDX Total Return Price data by YCharts

In 1998 when I started my hedge fund, I had an ILX machine for stock quotes and a Motorola Startec.  Amazon was coming public and it was obvious to me that the trade was long Fedex and short Amazon.  Fedex would make all the money and Amazon would be bled dry.  Obviously I had my ass handed to me. It was the smartest big loss I ever took.  I would have gone bankrupt within 6 more months.

Amazon and Fedex ($FDX) have made magic for their investors. They did so for the customer as well. While we weep about our Apple losses and the end of the world, step back and think about your timeframe. Why did you invest. Buy and hold still works if you catch big enough trends, great companies, great leaders and ride out big drawdowns. It’s not easy and it is not for the weak.

Congrats to all the great transportation entrepreneurs and investors. Amazing day indeed.

  • Marius Fermi

    Amazon has been a colossal mover with plenty of room to keep going in my opinion. Unlike Apple which has become like a penny stock with volatility, Amazon doesn’t really focus on a business strategy of innovation other than it being a side project.

    Plus I’m bored of hearing everything about Apple & when the Hiptsters leave the brand they may have a serious problem.

    • http://www.howardlindzon.com howardlindzon

      the old people will pay their $99 for service which is lucrative in itself

    • http://twitter.com/PlunkettDonnie Donnie Plunkett

      2nd that. I am definitely not on the cutting edge of cool and use an iPhone. Our college-age babysitter and all of her friends have Android devices.

  • http://www.howardlindzon.com howardlindzon

    sure…of course.

  • fb_stockpro

    anyone else notice this is the 5th day in a row the DJIA has opened 30-60 pts lower only to surge into the green? EMH debunked? looks like it

    • http://www.howardlindzon.com howardlindzon

      strong tape

  • fb_stockpro

    Short transports, buy ES? Hard to lose in this trade considering transports have a tendency of lagging the broad indexes and they get murdered during downturns.

  • http://www.ivanhoff.com ivanhoff

    Holding works when you hold winners = stocks that keep making new 52-week highs with no deeper than 20% drawdown. $AMZN dropped 95% in 2000-2001. There is no way, anyone would’ve held through that dip. There is nothing wrong in taking profits and waiting for a stock to set up again. Safety is derived from proper timing, not only from proper equity selection.

    There is a hint of hindsight bias when studying current winners. People never look at the stocks that had the same characteristics but didn’t make it.

    • http://www.howardlindzon.com howardlindzon

      yep

  • Pingback: Wednesday links: broken barometers - Abnormal Returns | Abnormal Returns

  • Pingback: Hot Links: Greater Uncertainty | The Reformed Broker

  • Pingback: Best Of The StockTwits Blog Network 1-19-13 - bclundbclund

Back

© Trends… Find them, ride them and get off.. All rights reserved.