The Intelligent Investor - The Definitive Book On Value Investing

And on the NASDAQ exchange, turnover hit warp speed, as Fig-

ure 1-1 shows.^4

In 1999, shares in Puma Technology, for instance, changed hands

an average of once every 5.7 days. Despite NASDAQ’s grandiose

motto—“The Stock Market for the Next Hundred Years”—many of its

customers could barely hold on to a stock for a hundred hours.

THE FINANCIAL VIDEO GAME

Wall Street made online trading sound like an instant way to mint

money: Discover Brokerage, the online arm of the venerable firm of

38 Commentary on Chapter 1

Stocks on Speed

0

5

10

15

20

25

DoubleClick

CMGI

Amazon.com

e*Trade Inktomi

RealNetworksQualcommBroadVision

VeriSign

Puma Tec

hnology

Average length of ownership (in days)

(^4) Source: Steve Galbraith, Sanford C. Bernstein & Co. research report, Jan-
uary 10, 2000. The stocks in this table had an average return of 1196.4% in

1999. They lost an average of 79.1% in 2000, 35.5% in 2001, and 44.5%
      in 2002—destroying all the gains of 1999, and then some.

FIGURE 1-1