I really struggle to buy into companies that have enjoyed stock price appreciation at the rates many of the companies discussed and favored here have grown.
Honestly, I know intellectually it’s just my bias – a good company is a good buy, history be bygones.
Still tough for me to overcome my bias and double down on winners already double or triple from my first entry point, especially when my entry point is so recent compared to my life-long bias/training of buy and hold.
One approach which works for me is to buy 25-33% of my intended starter position. Get you some skin in the game. You can then dollar cost average in over the next few months.
Most high growth stocks have significant volatility, which may create opportunities for better entry, You also have a stake if they go nova in the short term.
I really struggle to buy into companies that have enjoyed stock price appreciation at the rates many of the companies discussed and favored here have grown.
Honestly, I know intellectually it’s just my bias – a good company is a good buy, history be bygones.
Still tough for me to overcome my bias and double down on winners already double or triple from my first entry point, especially when my entry point is so recent compared to my life-long bias/training of buy and hold.
Buy more MDB? TTD? ZS? New world for me.
-kiplin
Considering the volatility of the market and momentum trading in certain stocks, it’s a rational bias. I have the same bias. It’s saved me a lot of money since I never buy at the peak. But at the same time, it’s prevented me from buying some winners.
I’ve seen so many stocks soar and then do a “round trip” back to the bottom.
I’m hesitant to buy TWLO near it’s highs after it’s risen several fold this year.
I don’t have a clear answer but I think the key is to assess the longer term picture and consider valuation.
Considering the volatility of the market and momentum trading in certain stocks, it’s a rational bias. I have the same bias. It’s saved me a lot of money since I never buy at the peak. But at the same time, it’s prevented me from buying some winners.
I’ve seen so many stocks soar and then do a “round trip” back to the bottom.
I’m hesitant to buy TWLO near it’s highs after it’s risen several fold this year.
I don’t have a clear answer but I think the key is to assess the longer term picture and consider valuation.
The key is simple. Buy a small position. If it goes up you’re happy, if it goes down you can consider buying more if the story remains the same. That’s the way I get into almost every position, and Saul does the same. Rarely (basically never) do they start at 10% or 15%.
Let’s bring this thread to a close. It’s interesting, but I’d love to see us get back to analyzing earnings and other news on growth companies.
With apologies to Bear and the rest of the Saul’s community, I ask that I have the last OT post on this.
Kiplin, I see that you are a member of Stock Advisor, and I’d like to request that you repost your question over in the Stock Advisor community. I’d love to reply – price anchoring has led to some of my most profound “fish that got away” stories, and overcoming it has led to some of my best investments.
If you’d like, please repost your question in the SA community. Maybe the “Becoming an Investing Master” board would be best: