Irrational Exuberance - what makes you feel invincible?

This post was originally posted on Nov 15th at tradeking.com
---------------------------------------------------------------------------

Irrational Exuberance - what makes you feel invincible?

4 of my stocks go up 17% (AOB $9.89), 25% (MDF $2.75), 28%(ETLT $0.60), 42%(CXTI $3.48) today and I feel so happy and invincible. This doesn't even tell the story, 3 of them goes up more today than what I paid for. I paid .30 MDF, .80 CXTI and $1 for AOB. (and ETLT I am confident that one day it will go up .49 on a single day someday in the future.

Though I know the company just post great earnings, they are the same company and I shouldn't feel that this will continue to go up. The Irrational Exuberance phenomena happen when the stock continue to go up and people think the rally is warranted and will continue to go up. People forget about the valuation (on how expensive they are) and when the issue is brought up, they downplay the importance of valuation or overestimate the growth rate (or keeping the high growth rate too long in the DCF model) and this phenomena impacts not only traders but long term investors too (basically most human, probably except people like Warren Buffett.

Irrational Exuberance is not good because it makes you stray from your strategy (I made one exception on my rule of not to short stocks when I made money on my first shorts GOTO and it look so easy so I did it again with KKD and I made a bunch of money again but I know it was more luck than skills so I get back to earth and I stopped shorting stocks). And stocks that defy gravity usually comes back to earth.

Anyway, I'm feeling invincible as my AOB and MDF are flirting with a ten-bagger return for me. I hope I will come back to earth soon, but for now, let me enjoy this period of Irrational Exuberance, while it lasted

Sidarta Tanu

AOB hits ten-bagger for me and then some..

AOB hits ten-bagger for me and then some.

You see that kind of return and you know that it’s possible (I’ve experience it several times the last 6 years).

You got to keep learning from your success (as well as fom our mistakes/failure).. learn and disect (reverse engineer) on what makes AOB so successful…
Smart and high integrity management, great product, great industry, great opportunity and great execution are some of the traits…

Look at my previous entry about AOB and value microcaps..
Also glad that the other example (ETLT) that I gave about Value Microcaps also post great earnings On Nov 15th

Sidarta Tanu