I like this perspective. I'll add something to it: I think it's also helpful to run a few financial screens during a crisis. Sometimes you find businesses that are financially sound but never showed up in any other place. In 2008 I found a company that makes toilet paper (what investor would seriously follow that industry?). That was an easy one.
It's also important to make adjustments for new information. I was heavily invested in retailers when COVID happened, so selling at that time might have looked like panic selling, but I was very happy with what I was able to buy. To the same point, Buffett selling airlines during COVID looked like panic selling to many people, but it was the right move.
You're right. It never hurts to look. But if that's the whole strategy, it's a failed one. Re: selling in down markets...it's appraising each opportunity against the other. If you sell what you own down 10% for something down 30 or 40%, that could be a good trade.
I like this perspective. I'll add something to it: I think it's also helpful to run a few financial screens during a crisis. Sometimes you find businesses that are financially sound but never showed up in any other place. In 2008 I found a company that makes toilet paper (what investor would seriously follow that industry?). That was an easy one.
It's also important to make adjustments for new information. I was heavily invested in retailers when COVID happened, so selling at that time might have looked like panic selling, but I was very happy with what I was able to buy. To the same point, Buffett selling airlines during COVID looked like panic selling to many people, but it was the right move.
You're right. It never hurts to look. But if that's the whole strategy, it's a failed one. Re: selling in down markets...it's appraising each opportunity against the other. If you sell what you own down 10% for something down 30 or 40%, that could be a good trade.
I totally agree! Better to be prepared.
Great post - there will always be fire sales that come by so why not be ready when it comes.