That's a really interesting observation. I wonder if we took all the most discussed ideas on CBOF, looked at the trading prices from the first month (averaged) till today, what the performance would be like. I often wonder whether online investing forums are worth visiting anymore. Might be easier just to do passive investing, ala Bogleheads, for the average folk than all of this "analysis" junk.
Looking at the trading prices on the first day someone submits an idea (or discussion of some stock) isn't that great of a way to measure whether an idea was decent or not. I think the problem is that investors think of "good ideas" as ones that never/rarely go through cycles and keep compounding over time. Those would obviously be amazing ideas, but if you look at how often the S&P or whatever index replaces components (again these are usually the largest and most dominant businesses in the world, kind of interesting to see them thrown out all the time), it's really hard to take a snapshot of a bunch of ideas and then come back in five years and say "wow, they blew up" or "man what great stock selection." Between when an idea is posted a lot of things can and will happen. So it's more about adjusting to a constant change of information that can affect intrinsic value and you have to compare these things to what's happening to the market price. I'm sure there are a lot of people who made a lot of money on BAC when it went down to $5 or back down to $11 in 2016. Was the first post on BAC not that great in terms of timing? Sure, probably not. But first posts aren't met to start a clock on some definitive outcome.
I saw someone else post about how Kerrisdale's stock picks in a 2013 article did terrible. One in particular was JGW. It lost pretty much all its value. But he did post his thoughts on VIC during the middle of 2015.
JGW is a frustrating situation, because, on the one hand, endur is likely right: the company has a lot of earnings power relative to its current valuation. It remains the dominant player in its market, and its margins have held up fairly well. However, we came to believe that other parts of our initial thesis were wrong or at least less certain than we thought: volume growth has been approximately zero (as opposed to modest but consistently positive), management has not been able to deploy excess cash via cheap M&A in its core business, and judicial and regulatory pressures increased (although we still don't expect any material negative outcomes). Moreover, while expansion into mortgage origination could certainly turn out to be a smart move, we think it's quite risky: origination is a ruthlessly competitive, low-margin business with many regulatory and capital-markets complexities, and JGW's senior management has no experience in this area. It's hard not to worry that these expansion efforts are meant to guard against the risk that structured-settlement volumes will ultimately shrink (as opposed to just not growing). Finally, management changes over the past year have brought uncertainty that to us added an extra element of risk.
So we thought we had a cheap stock and a company with decent organic and inorganic growth prospects in a market it knew better than anyone else. Now we're concerned that we just have a cheap stock. Buying cheap stocks tends to work well on average, but given our general preference for less messy longs as well as faster growing companies, we moved on. If we end up regretting exiting the position, it wouldn't be terribly surprising.
When you deal with crappy stocks like these, you have to adapt much more frequently than you would with anything in a Berkshire 13F. That's a tough skill to have.
Just from my viewpoint, I think most of the more popular stocks on CoBF have a lot of volatility around intrinsic value, not just the market price. Whether it's AAPL or BAC or SHLD. But there are times when BAC might be at $10 but intrinsic value is $20. Or SHLD is at $15 but intrinsic value is $50. And so on. Usually those moments happen in the middle of a thread, which is actually great because if you follow the changes in value there are times where you can take a relatively large position, take less risk, and get better overall returns for your portfolio.
The other side to this is wanting the first poster to say "I have 50% of my portfolio in this one stock, it's going up 5x and here's why." That's obviously not a great way to scan for ideas and try to tag along. It's probably a lot better to start with cheap stocks and wait for times when they get super cheap so you'll have a better sense of what you're getting yourself into. There are a lot of ideas on the board like this (same goes for VIC and whatever other blogging site).