You can’t outsmart the market
So you’ve scoured the troves of company information looking for a diamond in the rough. You find it. It’s an obscure company that been around for decades. It has a microscopic debt to equity ratio. It has shown double digit y/y growth every quarter. It has an EPS of 5 quadrillion and and P/E that makes it too good to pass up. In addition it seems like the economic trends will help this company to grow even faster in the future and increase profit margins.
So of course, you invest. You hold it for a year and do you know how much money you’ve made? Zero, nada, nothing. Why? Because the company doesn’t pay dividends and the stock is worth only what other people say it’s worth. In other words, finding an obscure diamond in the rough only pays off if other people find it too. Believe it or not you want Kramer saying how good a buy it is. The more the merrier. You don’t win by outsmarting the market.
You need to be exactly as dumb as everyone else, you just need to be faster
So how do you win? By investing in meme stocks of course. Don’t denigrate the meme stocks. Don’t look down on them. Don’t think, has everyone lost their damn minds? No. Instead go in on meme stocks, just make damn sure that you’re early. And keep in mind that you don’t want to be there when people figure out that they aren’t really that great. So don’t be afraid to take profits. Even if it means leaving some potential on the floor. Buy early. Sell regularly as they go up.
submitted by /u/jckonln
[link] [comments]
source https://www.reddit.com/r/StockMarket/comments/ggknvs/an_important_lesson_that_ive_learned_the_hard_way/