A Quick Philosphy on Long Term Investments

I bought POWI today, even though it’s up after a great earnings report, because I believe the incandescent light bulb is a thing of the past. POWI plays an integral part in making the LED bulb successful, through its parts. On top of that, they will soon be in millions of smart phones, providing ‘quick-charge’ technology to the masses.

Many months ago, I asked you “when is a good time to buy a winner?” The answer is, with very few exceptions, “any price.”

Sometimes we lose the forest for the trees, attempting to market time. If you have a stock that you feel will do great, long term, just buy it and quit worrying about short term moves.

(I am talking to myself more than you.)

My condensed philosophy for investing in stocks, longer term, is quite simplistic, but entirely logical.

If you worked at XYZ corp., right now, would you participate in a stock options program and do you think there is significant upside to the company?

Forget about the stock. Is the company in a position to undergo rapid growth, which can lead to wealth creation for its employees who participate in a stock options program?

If the answer is yes, go long and dollar cost average, every month, as if you were an employee.

Having said that, I am a buyer of POWI, longer term, and if I can contain myself, I hope to sell it north of $100.

They are, without a doubt, a game changing company in the smart phone space.

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