Tuesday, January 11, 2005

First Entry / My Investment Strategy

My investment approach has evolved over time. I first started investing in stocks in college. I bought based on hype. A bad strategy! Fortunately, I didn't have much money to invest in those days. I actually remember my first stock purchase... It was a biotech company called Xoma and the company was expected to win FDA approval for a drug to treat septic shock. I bought some shares based on the hype. And guess what? The drug got rejected by the FDA.

Then I started to read some books such as One Up On Wall Street by Peter Lynch. The book that really influenced my investing style is: How to Make Money in Stocks by William O'Neil. He introduced a set of rules to follow and it has worked fairly well out over the years. I use his strategy for my initial screens, but I tend to hold the stocks for the long term. I find it amusing how people dismiss the buy and hold philosophy. As long as the company generates the sales and earnings, hold on and enjoy the ride.

I primarily invest in biotech and pharma stocks. I work in the biotech sector, so I feel like I have a little edge (the Peter Lynch philosophy). Anyways, my current holdings are: Amgen, Biogen, Genentech, Genzyme, Qiagen, Invitrogen, Fisher Scientific, Johnson&Johnson, Boston Scientific, Pfizer, Microsoft, Cytyc, QQQQ, and Las Vegas Sands. I know, you're wondering how does Las Vegas Sands fits in this picture?? I managed to get some shares at the ipo price and decided to hang on to it.

This week is the JP Morgan healthcare conference. Lots of companies making major announcements in this conference. Invitrogen announced the Zymed acquisition (good move) and Genzyme increased guidance. But Genentech sold off on the Avastin numbers.

Oh well, you win some and you lose some...


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