Hey guys and gals. Whenever bad things happen we tend to get admonished for investing in “overpriced”, “over-valued”, odd-ball, and aggressive stocks by people who tend to invest much more conservatively than we do. So lets look at actual results. That is, let’s look at how we are actually doing.
In September we survived a short attack on Ubiquiti, which was a relatively moderate position for me. As I wrote in my month-end summary, I finished September (last Friday), up 64.8% year-to-date, up from up 48.7% at the end of the month before (August), in spite of the short attack on Ubiquiti. And I’m not the only one. Plenty of other investors on the board had huge gains so far this year too.
So what about this last week? I surely had one of the largest Shopify positions going into this week. As I described in that same month-end report, Shopify was 21.6% of my portfolio. And following the short attack this week Shopify was down 15.9% this week. I ought to be panicked, right?
Let’s see: by the end of this week, after the big attack on Shopify, my portfolio year-to-date dropped from … up 64.8% year-to-date, all the way down to …. (drum rolls here) … up 63.1% year-to-date. Wow! Am I panicked! Only up 63.1% after that short attack. I should sell all my shares and lock in my profits! (But I should have done that 5 months ago when I was up 26% in 4 months… or 4 months ago when I was up 36% in 5 months. Obviously that couldn’t last. Stocks must be overvalued.)
I wonder how much those conservative investors, who aren’t investing in “over-valued” stocks, are up this year.
PS – I haven’t reduced my Shopify position.
PSS – Surely a market sell-off will come. They always do. But I certainly wouldn’t sell out of a company that is doing about as great as a company can do because of a total nonsense attack it, by someone who accuses a SaaS subscription model company of being like Herbal Life and thus showing either no knowledge at all about the company, or a clear attempt to deceive naive investors.