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GROWING RICH WITH GROWTH STOCKS<br />
least where the Dow Jones Industrial Average of 30 blue-chip stocks<br />
closed out the session, while this information is relayed even more<br />
frequently on the radio, Internet, and business section of the daily<br />
newspaper.<br />
Since the media spend so much time reporting on “the market,” it<br />
seems logical that it’s something investors should pay attention to.<br />
But it’s not. Savvy pros know it is nothing more than distracting noise<br />
that can prevent you from doing what’s really important: focusing<br />
on picking quality <strong>com</strong>panies and keeping track of them.<br />
“If I were an individual investor, I’d read the weekend press coverage<br />
and that’s about it,” says Robert Stovall. “Don’t look at what’s<br />
going on every day. I have some clients who will buy something one<br />
day, and if it goes down the next morning they’ll call and tell me to<br />
sell it. I have to quiet them down and explain that if you take a position<br />
in a <strong>com</strong>pany that you have conviction in, you shouldn’t sell<br />
out after the first two down days. People like that would be better off<br />
not reading the newspaper at all. Getting all worked up about the<br />
events of the moment turns you into your own worst enemy. The<br />
buy-and-hold investor is the successful investor. This is the person<br />
who does his or her homework, has patience, and lets time work for<br />
him or her.”<br />
MARKET WATCHING FROM WORLDS AWAY<br />
In Roy Papp’s early days as a money manager with Stein Roe in<br />
Chicago, he spent time not only watching the market, but also trying<br />
to react to it. He was a shorter-term thinker, as was the firm, in terms<br />
of shifting assets in and out of stocks depending on which direction<br />
he thought the market was headed. After leaving Stein Roe & Farnham<br />
in 1975, he went overseas to be<strong>com</strong>e a U.S. representative to the<br />
Asian Development Bank in Manila. Once he got his own personal<br />
portfolio in order and scooped up shares of a number of small <strong>com</strong>panies<br />
that got clobbered during the 1973-1974 bear market, he<br />
headed overseas, intending to follow his investments from abroad.<br />
“When I was in Manila, I was never awake when the New York<br />
Stock Exchange was working,” he says. “I got The New York Times<br />
about ten days late. I was forced to make some changes. I couldn’t<br />
make investments on a short-term basis. I realized I had to have a<br />
long time horizon of three to five years. I bought many dirt-cheap<br />
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