Fighting for 1/16th of a Point!? [Fribble] March 1, 2000

Fribble Fighting for 1/16th of a Point!?

March 1, 2000

I recently saw an ad for some broker service that declared they would fight for that extra 1/16th or 1/8th on every trade. It reminded me of when I first started trading several years ago and watched the ticker immediately after I bought a stock. If it went down (even 1/32nd), I started whining about how I should have waited before buying that stock.

Flash forward to several years later. Do you really think I care if I paid 1/16th too much for my AOL shares? They are up in excess of 500% and I couldn't care less about the fractions when I bought my shares. The same is true for some stocks I bought that lost money. If I sold a stock at a 50% loss, did it really matter at what price I bought the stock? If I bought 100 shares at 1/16th higher than the next guy, it cost me a whopping $6.25 extra. Did this really matter when my value was cut in half? Heck no!

The lesson here is a simple one. Buy stocks in great companies that you intend to hold forever. The actual price at purchase (and especially the fractions) are almost irrelevant.