5 Things I Learned at Cabot

 
5 Things I Learned at Cabot

He Was a Bold Man Who First Ate an Oyster

Stock Market Video: Holiday Edition

In Case You Missed It


Happy New Year! As 2011 comes to a close, I wish you the best in all of your investments in the coming year and beyond.

I've learned a lot of things in the four years that I've worked at Cabot and that started the minute I walked in the door for my very first interview. Tim Lutts, Cabot's president, showed me around the incredible building the office inhabits (it was once a library), ending at a very long-term chart of the stock market. He pointed out that despite setbacks, over time, the stock market has always gone up.

In my last column as editor of Cabot Wealth Advisory, I want to share with you some of the most important lessons I've learned here.

1.)   Always be optimistic. From that very first talk with Tim, I knew he was a forward-looking and thinking individual. And his optimism became even more apparent during the financial crisis that swept through the markets in the year-and-a-half that followed. That's not to say everything was rosy, but he never lost hope that the situation would turn around and made sure we didn't either. And he was right! I never worked with Cabot's founder Carlton Lutts, but from what I've heard, his optimism was boundless. I'm sure that's where Tim learned it from and I'm so glad he passed this valuable lesson along to me. I now have faith that whatever dark days are ahead, they will end and even better things will come in their wake.

2.)   Work should be fun. Cabot is a really enjoyable place to work. Every morning we take a 30-minute break for coffee (you can have tea or water too) and sit around a big table to talk. It's a nice break from the computer screen and helps everyone in the office get to know each other on a personal level. We also get to go on fun outings (like mini-golf or a brewery tour) when we hit certain goals that we set at the beginning of every year. These trips are great ways for us to bond and feel like all of our hard work has paid off.

3.)   Don't succumb to groupthink. If you read the Weekend Digest regularly, you know that I always publish a button with a saying on it that teaches a lesson applicable to the market and life in general. Tim has been collecting these buttons for decades at the Contrary Opinion Forum in Vermont and has them arrayed in his cubicle where he can read them for daily inspiration. When I was in elementary school, I saw a banner that read "What is right is not always popular, but what is popular is not always right." That stuck with me through the years and the same theme runs through a lot of what we talk about at Cabot. It's important to be able to look at investor sentiment and recognize that when it's at it's worst, that usually means the market is about to turn around (and vice versa). It's a difficult thing to do, going against the grain, but you're almost always rewarded for it!

4.)   Never stop learning. As I said at the beginning of this issue, I started learning things the minute I walked in the door for my very first interview at Cabot. Tim is a big proponent of continuing education in the sense that you should never stop learning new things. He reads several newspapers a day and is always interested in discovering something he wasn't aware of before. I've always had a very curious mind (when I was younger, my brother would often implore me to stop asking so many questions ... instead I became a journalist where I get to ask questions all day long!) and that attitude has been fostered here. I plan to keep learning as long as I can and I encourage you to as well.

5.)   Take risks. Investing in the stock market is a risky business. Sure there are systems and indicators and strategies that can put the odds in your favor, but there's always risk involved. So once you establish that the market trend is in your favor, do your research on a stock and decide how much of your portfolio to invest in it, dive in! I don't usually think of myself as a big risk-taker, but in the last few years I've learned that sometimes taking a leap brings fantastic results. I often think of one of my favorite Henry David Thoreau quotes when I consider the benefits of taking a risk and it often motivates me to take the plunge: "If one advances confidently in the direction of his dreams, and endeavors to live the life which he has imagined, he will meet with a success unexpected in common hours."--Henry David Thoreau

Since this is my last column, I want to thank you, our readers for checking in with me every Saturday and for your many emails containing invaluable feedback, advice and encouragement. I hope you keep learning along with everyone else at Cabot for years to come!

Here's this week's Contrary Opinion Button. Remember, you can always view all of the buttons by clicking here.

He Was a Bold Man Who First Ate an Oyster

The words are from Jonathan Swift, who actually wrote, "He was a bold man that first eat an oyster," and declined to explain further, no doubt thinking it unnecessary for the simple sentiment. Oysters are a marvelous delicacy, yet visually off-putting; thus the idea is that courage was required to discover the treasure. (Try as I might, I can't ignore the fact that oysters were doubtless enjoyed by primates long before those primates evolved into men.)

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For this week's Stock Market Video, the last one of the year, Cabot China & Emerging Markets Report Editor Paul Goodwin decided to do something a little different to look back at all that has happened in 2011. Paul recited a poem that he wrote re-capping both the high- and low-lights of the year to the beat of "Twas the Night Before Christmas." Click below to watch the video!

Stock Market Video


In case you didn't get a chance to read all the issues of Cabot Wealth Advisory this week and want to catch up on any investing and stock tips you might have missed, there are links below to each issue.

Cabot Wealth Advisory 12/26/11 - Is Main Street Finally Catching on to Options?

On Monday, Cabot Options Trader Editor Rick Pendergraft analyzed volume data from the New York Stock Exchange and Chicago Board of Options and uncovered some staggering findings. Rick discovered that investors are finally seeing the advantages of investing in options.

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Cabot Wealth Advisory 12/29/11 - Top Picks for 2011 Winners

On Thursday, Dick Davis Digests Editor Chloe Lutts discussed the best-performing stocks of 2011 from among those that were recommended by the Digest contributors for last year's Top Picks issues. Featured stocks: Allot Communications (ALLT), Global Defense Technology and Systems (GTEC), IAC/Interactive Corp. (IACI) and Chunghwa Telecom Co. (CHT).

Wishing you all the best in 2012 and beyond,

Elyse Andrews
Editor of Cabot Wealth Advisory

Stock Picks

Loews Corp.

This undervalued stock has strong future earnings growth expectations.

Biogen

Biogen is the market-share leader in treating multiple sclerosis.

Weibo

One of Paul Godwin’s favorite stocks in his Cabot Emerging Markets Investor portfolio.

Cabot Wealth Advisory

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