dimanche 11 février 2024

Three stocks I regret (having sold them or never bought them)

I made a lot of mistakes and I have a few regrets concerning my investing journey over the last 15 years.

My main mistake has been to follow others by investing in stocks that didn't seem so good to me. But the conviction of others may make you lose your critical thinking. When you begin, it's very hard to be independant and don't be influenced by other's opinion, especially, the so-called experts (by the way, I now think that there's probably no experts in the investment world)

These last years, I haven't made big mistakes if I define a mistake as investing on a bad company or losing a lot of money with a bad decision. But there are a few stocks that were very good occasions that I missed because I thought the risk was too high while it wasn't. 

These three stocks were blue chips: super solid stocks with high margins and high ROE. They were all available at a very good price (between 10 and 15 times their earnings) in the last few years. Since, they all came back to a "normal" price for such high quality stocks (PE of 25-30).

These three stocks were Apple (AAPL), Netflix (NFLX) and Meta (META). 

Lesson learned: when a stock with margins over 20% and ROE over 20% is sold for under 15 times it's earnings, the chances that it would be a good investment are high. 

I don't think that betting 50% of your portfolio on one of these stocks would be a good idea (like Buffett who has 50% of Berkshire Hathaway on Apple) but 2-3% on one of them should be a no-brainer if they ever go back to such ridiculous price.