These stocks issued more shares. Or did a PIPE (private investment in public equity) which diluted shareholders even more. There were numerous rounds with each one promising even better results. I've heard every biotech story and unfortunately bought many of them. I only saw the sizzle. There was no steak (also known as earnings). I sat on some of them for years, waiting, hoping, praying. But there is no hope in the stock market. Only earnings. And these didn't ever produce those.

So I sold most or all of each position I had, taking large losses in every one of them. The same was true of certain tech stocks, ones that were going to revolutionize computers, telephones, televisions, cars, etc. But they never got to the earnings part of the P/E equation (price to earnings). There was only the price, and it kept going lower.

I didn't sell all the stocks. I kept a small position in many of them. If they do finally deliver, these stocks will fly. I took huge losses. I was sad. But I'm feeling better now.

I took the proceeds and bought some strong, industry leaders, the ones with plenty of earnings history and lots of capital to ride out these tough times. I've noticed on bad days in the market, they go down, but not nearly as much as most other stocks. Certainly not as much as stocks I sold. When there are rallies, my new stocks
lead while my biotech and tech stocks barely budge.

I bought certain, large, still very profitable banks, the ones that will do well once the economy ignites again. They own mortgages but not many of the subprime issues. They have large loan loss reserves. They are increasing dividends or buying back stock. I believe the bank sector is offering a once in a lifetime opportunity. It may take a while to work through current issues, but when finished, these banks will lead their sector, maybe the whole market.

I added some tech names, ones that stumbled, missed a quarter's earnings by a few cents and were pummeled for it. They have plenty of earnings, great patented technology, are industry leaders. Analysts are keeping or upping their estimates for earnings this year and next. Those stocks are performing very well in this
difficult market.

Granted, I don't own nearly as many shares of these much higher priced companies. I sold thousands of shares to buy maybe a hundred or two of the new stocks. But that's the price I pay for not buying earnings. It will take a long time to recoup my losses from these stocks. I have no doubt I will. The dividends will help buy more of them.

Opportunity is banging. For brave investors who can stand the pain of selling at a loss, there are great stocks to buy at prices not seen for many years. Take the loss.Feel the pain (a feeling that goes away over time as you compare what you did own to what you now own). Then feel the pleasure.