The Buy and Hold Lie
     A few years ago, I got to go fishing in Alaska with my family. I drove to the airport in my GM pickup, flew a commercial jet to Seattle, caught a smaller jet to fly into Ketchikan, boarded a float plane to camp where I embarked on a metal-hulled fishing boat built to handle the swells of the Pacific. Each leg of the trip had a vehicle uniquely matched to effectively and safely handle the specific needs of that situation.
      Imagine having a “board-and-hold” philosophy instead of being willing to adapt to different modes of transportation in order to get to the destination! Consider:
      “Will Rogers said, “Buy a good stock. When it goes up sell it. If it doesn’t go up, don’t buy it.” It would be nice if we could invest with 20/20 hindsight. But since that will never happen we must have a process for selecting a time to buy, a time to hold ‘em and a time to fold ‘em. 
      It’s so easy to focus on the investments rather than the process. To be successful we must focus on the process. I have several friends in manufacturing businesses from computer chips to automobiles. They will tell you that quality and consistency doesn’t come from a one-time decision that you put on autopilot. It comes from a vigorous and consistent process. It’s all about the process.
      It’s a beautiful idea to think that all you really have to do is buy a good company’s stock and never sell to get super rich. But the facts don’t bear it out any more than the certainty that the road to financial success is to be on red27 at the roulette table. “Buy and never sell” is a first cousin to “plant and never prune or fertilize.” It would be nice if life worked like that, but it doesn’t.
      Virtually no blue chip company stays a blue chip forever. Even great companies can stumble and fall, and they frequently do. When Charles Dow created the Dow Jones Average in 1885, there were 14 companies in his index. Of the 14 original companies only one is still around today.  Look at recent history with companies like Pan American World Airways, Woolworth, Kmart, Bethlehem Steel, Enron, WorldCom and Service Merchandise."   --from Retire with Confidence, pg. 68-69, 2006, Gregory Luken.

7 Critical Questions
1)  Is the same strategy that got you where you are the best strategy to get you where you want to be?
2)  What is your strategy for handling the next bear market?  It will certainly come.  What will be different for you?
3)  What is your strategy to capitalize on the recovery, whenever it comes? 
4)  How will you give yourself the highest probability for achieving your goals on time?  
5)  Do you have a documented (written) process?  The most successful businesses have their plans in writing, shouldn't you?  Is it up-to-date?
6)  Does your process work?  Is it working currently?  Will it work in a different market environment?
7)  Did every responsible professional on your team know what to do AND follow through relentlessly to actually get it done?

*The Opinions expressed herein are those of Gregory Luken, Financial Advisory, Investment Advisor Representative and Registered Principal of SII, and not necessarily those of any company with which he may be affiliated.  This newsletter is provided for information purposes only.  It is not a solicitation to buy any product or service.  All information herein contained is gathered from sources believed to be accurate but is not guaranteed.  Reproduction in any form without prior written permission is expressly prohibited.