Originally Posted by
Big E 757
I get what you’re saying, and I’m kicking myself for selling SHOP a couple months ago, but Trips numbers on those stocks he posted, are pretty phenomenal. He may not get as many 10x and 20x trades, but really, how many are actually out there from year to year? Trips system has uncovered (I didn’t count) 8-10 doubles and triples in a year and a half, and like he said, timing has been on his side, but it obviously works. What’s wrong with using his system? It’s obviously working for him. I actually bought one of the books he mentioned to do MODD. Also, because I just love reading about different ways to approach investing and trading.
I think you’re being a little too critical on his approach to the markets, when there are people who are more risk averse out there than others. And even though companies like SHOP and TSLA have out performed the markets by a factor of 8-10+, there has been more risk in holding those companies.
The important point of all of this is that, all it really takes is a few outsized returns to generate the wealth. The only way you can do this is long term, buy, hold and wait. You cannot let a ratio inform the decision.
Trip has done great. There are many ways to skin a cat, but his data cannot be considered statistically significant. If we are playing the short term game, for every double or triple he has produced I can produce a 10x for the same time period. What matters is long periods of time and outperforming a benchmark. A few names have become the bulk of my PF much like a few names dominate the S&P. That’s how it works. That’s my point. Let growers grow and they provide the outsized returns over time. It doesn’t take many. The rest become fodder and, yes, every now and again some go to zero and result in the :::gasp::: permanent loss of capital.
Investing (trading) in and out based on dividing a couple numbers will cost growth and by no means disproves that growth is dead.
What I want to do is provide a counter to Trips incessant posts about “nose bleed valuations” so that, perhaps, others interested in investing for growth aren’t driven by fear and ratios, but by seeing the bigger picture. It’s worked for me, I have the data, it can work for others.
And with that, there isn’t much else I can say without repeating myself. The valuation game is an age old tradition that ultimately leads to price anchoring and missed opportunities.
Look forward to the 5 year checkup when real statistical data can be provided. Until then! 🍻