Out of sight, out of mind

I was just starting to invest on my own when I got a piece in the mail about a new shoe stock and fell in feet first clear up to my neck. I would have done all right, had I not gone on vacation with no way to follow my positions or trade. While I was away, the stock went from just over $ 2 per share down to $ 0.25, never to recover again. I’ve learned to always be aware of my positions and to make sure I can buy or sell instantly. I still lose some here and there, as everyone does, but that’s part of investing.

— D. E., Lanesville, Ind.

THE FOOL RESPONDS:

It is indeed smart to keep on top of your holdings, and common to lose money now and then, but you were dealing with a penny stock.

They’re often extra-risky and are usually best avoided. Stick to established companies with successful track records of growth and profits, and they probably won’t drop by 88 percent with little notice. Successful investors should be able to go on vacation and tune out for a while!