A Fool owns up to his failings.
It is so easy to trumpet our own successes, but do we ever talk about the times when we really messed up? Do we ever remember when we got things really badly wrong?
So, I thought I'd follow up my article on the successes of my contrarian tips with an article on my worst investing mistakes. What was my greatest mistake?
The SuperGroup Redemption
I think there is only one place to start: SuperGroup (LSE: SGP). I tipped this at the beginning of the year, only to see the share price promptly halve. The company's inability to even add up its numbers properly led to a dramatic loss of faith in the business.
This was one falling knife that just kept falling: in fact, the falls seemed to gather unstoppable momentum. I had egg on my face in grand style. Sorry, everyone!
Will this company ever achieve redemption? Well, there are hopeful signs. This month SuperGroup's share price has finally returned to somewhere near my tip price. Profits are recovering, and like-for-like sales are up. But, in the notoriously fickle business of clothing retail, it would take a braver man than me to invest at this stage.
Emerging market carnage
I have been a long-term emerging markets bull. I am a strong believer in the big-picture story of emerging markets growing faster than their developed world counterparts.
But this year my faith has been severely tested as emerging markets have gone through a brutal bear market. The BRICs in particular have been absolutely trashed. These markets go great guns when there is a bull market, but in a bear market they suffer particularly badly.
The Russian market fell as commodity prices tumbled. I believe India still has the potential to be the new China, but it continues to battle the demons of corruption and poor infrastructure. Brazil's boom has started to slow dramatically.
And then there is China. This country's growth has slowed substantially, and its stock markets are in the doldrums. The mood music is as awful as it has ever been.
With my contrarian hat on, I would say that this might actually be the ideal time to buy into emerging markets. But that's no help to those who have already bought in and are sitting on substantial losses. More egg on face. Sorry!
The great growth story that never happened
Then there was Global Brands (LSE: GBR). This was the company that was supposed to bring Domino's Pizza to Switzerland. Except it didn't. This was the great growth story that never happened. After some wildly optimistic initial talk that it could match the growth of the UK company Domino's Pizza Group (LSE: DOM), the business was a flop. It never made a profit and the share price crashed to nearly zero.
Of all my share tips, I think this was my worst. To this day, the memory of it still makes me cringe. Egg. Face. You get the picture. Sorry once again.
I hope this doesn't sound too corny
So, am I an idiot? Well, I guess I am. But how have I reacted to these mistakes? Well, in my darker moments I have thought about throwing it all in and putting all my savings in a building society account instead.
But, just a week ago, I received an email. The emailer said that he was a big fan of mine. He thought that I was one of the best writers, and that my articles and the articles of fellow Fools had convinced him to pursue a career in investment management. Keep up the good work, he told me.
That really made me think about why I am doing this. Do I do this to boost my ego, and for self-aggrandisement? No. Do I do this for the money? Well, of course this is a factor. But the real reason I do this -- and I should never lose sight of this -- is for you, the readers.
Of course you don't give up. You just keep on trying, and keep on working.
Andy Dufresne: "You know what the Mexicans say about the Pacific?"
Red: "No."
Andy Dufresne: "They say it has no memory. That's where I want to live the rest of my life. A warm place with no memory." (The Shawshank Redemption)
Are you new to investing? Are you interested in buying shares, but want to avoid costly mistakes? Well, read this free report on "What Every New Investor Must Learn".
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> Prabhat does not own shares in any of the companies mentioned.
