I've been in this position many times. I remember when I first heard of Amazon in 1994. I remember when Google went public. I knew google was a great company, because I was in the search industry, but I didn't invest. I didn't feel it was in my circle of confidence. I remember when Apple was at $13 and had $6 of cash in the bank, and I still passed.

I don't regret any of that. Ok, well, I do, it stings a little. I'm greedy, I can't deny it.

But when I have invested, after a few years stumbling I ended up making more than a %100 return a year for many years of the last decade. I saw the housing boom before it happened (when Motley fool was recommending real estate) and profited from the boom and the bust (Which really started in 2006, though wasn't in the popular consciousness until 2008.)

And then I got out in 2007, after my best year ever. Why? The market was not acting the way I believed was rational (or the rational irrationality typical of the market that creates inefficiencies allowing me to profit).

It was a tough decision, getting out in 2007. But I felt great when just the next year it became clear my timing was perfect. (This is not a super power on my part, it was just good timing. I could have made more by waiting 6 months, but by comparison, I did fantastic.)

These hard decisions may look foolish in retrospect or like genius. I don't fault fool.com for being cautious about google.

The point of investing is that you have to do it based on rationality and the calculated return given the amount of risk.

A high price and a low confidence factor in the underlying business can mean a bad investment. Consequently a 100 year old company that is "boring" and thus unpopular can produce a massive return, because the price and the risk is low.

Jumping in to ride up over valued companies (like google was at least for many of those years) is what led to the original dotcom. I lost money on a couple of my positions there because I fell into that trap... and learned my lesson.

So. Don't look at this as stupidity. It is wise to pass. You do better by not taking flyers on things that don't seem like mathematical sure things (risk factored in) within your circle of confidence. I'm no investing genius, but I am disciplined... and that's all it takes.

On fool.com: The motley fool was a great and useful website for investing in the 1990s. When the dotcom boom was happening they advised caution (though they made their rep in the early days by recommending companies like iomega). Then around 2000-2001 they seemed to have a change in management, or at least a change in focus.

They switched from being prudent contrarian investment advice, to more mainstream and more "opinion" oriented.

It is kind of impressive to think that I stopped going there a decade ago. I literally haven't visit that site for 10 years, and I used to spend a lot of time there, to the point where I had quite a following.