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	The Year in Review Introduction The Top Investing Stories The Winners The Losers Our Greatest Hits What We've Learned Investing Opportunities in 2001 The Worst of "Investing 2000"

Like most individual investors, Fool writers and analysts strive to manage their finances while dealing with all the competing responsibilities of work, family, and maybe even some leisure time. As a result, mistakes are made and lessons are learned, especially in a year like this one. What follows are some examples of a few things Fools have learned about investing and handling their finances this year.

Diligence Pays
By Barbara Eisner Bayer (TMF Venus)

I've tried to abide by the golden Fool rule on selling stock: Sell when you find a better place to put the money. In the summer of 1999, I wanted to sell some of my holdings in order to generate funds to buy a new house. I hesitated, however, because the upward momentum of the market tempted me to keep my investments where they were. Then, Hurricane Floyd blew devastation through my property, felling dozens of trees, and causing thousands of dollars in damage. The realization that it's naive not to expect the unexpected sent me into action. I skimmed the cream off the top of my biggest winners, and stashed the bucks in a money market fund, with an eye towards buying a house the following summer.

Thank goodness I did! In 2000, I watched my profits shrivel faster than the Wicked Witch of the West splashed by water. Had I not taken the money for my house down payment out of the market, I might have lost that, too. When answering investing questions, I always say: "If you're planning to use money for a short-term goal, don't subject it to the stock market's volatility." In 2000, I learned that diligence pays. I now stick by my rules, no matter how tempting the alternatives.

Ten Lessons from 2000
By Rick Munarriz (TMF Edible)

What have I learned this year? Lessons.

Painful lessons. What a market. What a classroom.

1. I learned that catching a falling steak knife isn't as dangerous as assuming it has a handle when you try to pick it up after you hear a thud.
   
   
2. I learned that dead cats don't always bounce.
   
   
3. I learned that the phrase "margin of error" destroyed many leveraged portfolios.
   
   
4. I learned that, on any given day, it's not just day-traders who lose money.
   
   
5. I learned that he who laughs last is named Warren Buffett.
   
   
6. I learned that "long-term investing" doesn't start in April and end come mid-December.
   
   
7. I learned that while two wrongs don't make a right it might invoke the wash sale rule if done 30 days apart.
   
   
8. I learned that not only can you teach the old economy new economy tricks, but that sometimes the new economy should respect its elders.
   
   
9. I learned that, in the dot-com world, bulls make money, bears make money, but pigs better build out those bricks-and-mortar houses.
   
   
10. I learned that an ounce of research is worth a pound of hype.
    

Do Your Homework
By Chris Rugaber (TMF Chris)

The primary lesson I learned this year was that I am not the investing genius I was beginning to think I was, and not everything I buy automatically goes up.

However, one lesson that stands out is: know your company's customers. Had I done my homework on National Semiconductor (NYSE: NSM), for example, I might have sold my shares before they were clobbered for about 33% of their value in late October. The company warned on October 23 that sales would slow in upcoming quarters, in part due to reduced orders from their mobile phone customers, principally Ericsson (Nasdaq: ERICY). I knew that the wheels were coming off Ericsson's handset business, but a crucial little fact -- that they were one of National Semi's main customers -- unfortunately escaped my attention.

Safe Rather Than Sorry
By Peter Psaras (TMF Mycroft)

To say that this is the toughest year I have seen in my 26 years of investing would be an understatement. Let's start by saying that I have never seen anything like the rise and fall of the Internet stocks this year. The stock that has shocked me beyond compare is the king of the Internet, Yahoo! (Nasdaq: YHOO). You could say it was overvalued at $250 per stub, but to fall all the way to about $25 is surprising, to say the least. And Yahoo! is an Internet company that actually makes money!

The lesson that I have learned this year is to never, ever invest in a company that has no earnings. From now on I only want holdings that are pumping out serious cash flow and are market leaders in their industries. Companies with no earnings result in a myriad of potential problems. I would rather be safe than sorry.

When to Sell
By LouAnn Lofton (TMF Lou2)

This has definitely been a year where the market has taught me a few things -- about it, and about myself.

The main lesson I've learned is patience. I've learned not to freak out when I look at my portfolio and see a big wash of red. I've learned to remember why I am investing. I've learned to remind myself that I'm young and won't need this money for ages. I've learned to take deep breaths and stop looking and go do something else. I've learned that solid companies don't always have stocks that go up.

I've also learned one other big lesson: when all the facts tell you to sell but you're hesitating because of emotion or because you hope to squeeze out a few more dollars, SELL.

I knew all the reasons to sell Excite@Home (Nasdaq: ATHM) forever ago, and yet I didn't. I couldn't believe the stock was at $13 and $14 a share. Surely it would inch back up and I could get out without such a tremendous loss, right? I mean, I'd still be taking a loss, but it wouldn't be as nasty as the one I'd have taken at $13 a share.

Please. Why didn't I sell then? The stock's at around $5 a share now. $13 would have been a blessing. I hesitated and the market spanked me for it. I will try my best not to make that mistake again.

Lessons aren't always fun or welcome. But they are necessary, if we're to improve as investors and as human beings. I think that's a lesson in and of itself.

Next: Investing Opportunities in 2001 »