Warren Buffett once famously quipped that his favorite holding period was forever. In a hyperactive market where investors are bombarded with streaming data, 24‐hour business news, and constant investment ideas, it becomes difficult to remain patient and wait for opportunities to develop. Although I do not have the same patience as Buffett, I understand the need to allow ideas to work.

When I analyze a company, I research the operating business, study the financial statements, and prepare forecasts of how the business will perform in the future. By applying a discount factor which allows me to place a current value on a future event, I determine where the stock should trade.

On the occasion where the fair value is below the current price, I can buy the shares and wait for the
market to acknowledge the true price. Obviously, I prefer that the market act quickly so I can move on
to the next target. However, future unknown events can greatly affect price, so patience is needed.

As an example of the power of patience, consider the performance of Crocs (CROX) over the past eight trading days. CROX is a narrowly focused company that produces very popular shoes. A onetime growth darling, CROX peaked at $74.75 in October 2007, and then crashed to below $1 in

November 2008. As recently as two weeks ago, the stock had languished below $3.50-a price which was below book value and indicated the company was a dead man walking. Having lost its growth‐biased investor base, CROX was in an investment no‐man's‐land. The momentum crowd was gone and only the hardcore value players buying shares below book value remained on the scene. Considering that most of them had held the shares for nearly a year with little return, few new investors were buying the stock.

Then the catalyst occurred. With a better than expected earnings announcement and future forecast, CROX has traded to near $6.90 today and doubled in just over one week. Those who spent the time needed to understand the business and the balance sheet have been greatly rewarded as the market has finally recognized fair value. Looking at the position in their account each day for the past year was most likely frustrating, but in the end their patience paid off.

In a world where we are always encouraged to seek action and move money, CROX provides a valuable lesson. Over time, markets will eventually recognize fair value. However, the paths prices take are uncertain. When you buy a stock, know why you're doing so and identify which metrics validate your thesis. Always look for data that challenges your view, but never let impatience force you from trades. In a competitive environment, investors must allow their best ideas room to work. Failure to do so leads to hastily made decisions and sub‐par results.