Morey Teaches Investors A Lesson

There are a lot to learn form Houston Rockets general manager Daryl Morey when it come to investing, the most of important of which is to acknowledge your mistakes and to cut losses.

Coming off their dominant 65-17 season the Rockets was determined to again challenge the reigning champion Golden State Warriors. Morey made a series of off-season moves, adding big name Carmelo Anthony hoping to form H-Town's version of Big 3. Other new comers include once-ROY MCW, James Ennis, Brandon Knight, Marquese Chriss, etc. They replaced 3-and-D wings Travor Ariza, Luc Mbah a Moute and sharp shooter Ryan Anderson.

And how that roaster changes backfired. Rockets got off to an awful start, was second to last in the tough western conference with a dreadful 11-14 record before James Harden's historic offensive explosion. But Houston's turnaround was not without the drastic in-season roaster moves engineered by Daryl Morey. Melo? gone. MCW? bye-bye. Ennis, Knight and Chriss? Best of luck. In were D-leaguer Danuel House, cast-offs Austin Rivers and Kenneth Faried, all of them contributed to the team's dramatic turnaround. With two games remaining in the season, the Rockets are peaking going into the playoffs, as the team has the NBA's best record since the All-Star break.

The lesson for stock investors is simple -- no matter how experienced you're as an investor, you're going to make mistakes. To quote from The Intelligent Investor, "No matter how careful you are, the one risk no investor can ever eliminate is the risk of being wrong." But that's okay, as long as you're able to quickly realize you've made an mistake and takes immediate action to remedy that mistake. Once it's certain that mistake is made, DON't hesitate to act. No matter how big a price it might seem at the time to remedy the mistake, it's the minimum price to pay. The worst thing that could happen is to let the mistake manifesting itself into a bigger, even costly mistake.