Pigs Can Get Slaughtered

I bought a cable modem-maker in 1999 for under $3 per share in three accounts - one for me, two for my sons. In 2000, I sold it at $46 per share in one of my sons' accounts. I remember being worried I had sold too soon. My other son and I were going to sell at $100 per share, but the stock never got there. What was our target of $100 based on? Greed. The company wasn't making money. We never sold, and now it's worth less than a penny per share, basically worthless. At least one out of three people in my family made money. The investment wasn't as dumb as the investors. Pigs get slaughtered.

- Barry Rossheim, Venice, Fla.

The Fool Responds: It's important to have a more realistic sense of where your stock should be.

If it's earning $1 per share, for example, and its peers sport price-to-earnings (P/E) ratios of around 15, then you might expect a $15 price one day, though that's far from guaranteed, and you should study more factors.

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