🧠 Our Biggest Investing Mistakes
Friends,
What’s the biggest investing mistake you’ve ever made?
You’re probably thinking of an investment that lost most of its value.
But that’s probably not your biggest mistake.
Here’s what the three of us consider to be our biggest investing blunders:
- In 2009, Brian Stoffel sold Google for (a split-adjusted) $10 per share. He’s missed out on 820% returns — a mistake costing tens of thousands of dollars.
- In 2007, Brian Feroldi sold Dexcom for (a split-adjusted) $2 per share. He’s missed out on 5,800% returns — a mistake costing hundreds of thousands of dollars.
- In 2010, Brian Withers sold Netflix for (a split-adjusted) $20 per share. He missed out on 1,500% returns. Because it was his largest position, this mistake cost him millions of dollars.
Bad selling decisions have been far more costly than bad buying decisions.
And they all have a common theme:
- Stoffel sold Google because he couldn’t believe that he’d made a quick thousand dollars.
- Feroldi wanted to lock in a small profit while he could.
- Withers — sitting on 20-bagger returns — was worried about losing all he’d gained.
Loss aversion was at the core of all of these bad decisions.
Each of us were so worried about losing what we had gained that we lost sight of what actually mattered: what the companies could accomplish over the long run.
If we had looked at the businesses instead of the stocks, we’d likely have stayed put.
We hope you can learn from our mistakes. Holding great companies for long periods of time isn’t easy. But, selling a future mega-winner early is one of the most costly investing mistakes that you can make.
– Brian Feroldi, Brian Stoffel & Brian Withers
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