NVDA was trading around $15 in December 2022. By August 2023, it had tripled to $45. I started feeling intense FOMO but didn't pull the trigger because I was waiting for a dip. By May 2024, it had ripped to around $105. The stock was up 700% since I first started tracking it, and my FOMO was through the roof. I felt incredibly stupid for missing out.
I had done my research and really liked the company. Jensen is a smart workaholic who hates losing, and they have built a massive moat over the decades. There is only one Nvidia. I was confident enough in my 10 year outlook that I wouldn't sell even if it dropped 50%. The literal only reason I was holding back was because it was already up 7x and I was stubbornly waiting for a discount.
I finally decided to ignore my past mistakes and focus purely on the next decade. I pulled the trigger and bought Nvidia at an all time high. I felt like an idiot doing it after a 700% run. But then the stock went to $150, dipped back to $90, and is now sitting at another ATH again. I missed the initial 7x, but I still managed to double my investment.
I am sharing this because my whole investing career used to be focused on finding a good risk/reward ratio, hunting for discounts, and buying near 52 week lows. As I have gained more experience, my strategy has completely flipped. Almost all the stocks currently in my portfolio were bought near their 52 week highs.
It feels counterintuitive, but my new stock screener is literally looking for companies trading at ATHs. I realized I would much rather buy winners that have a great decade ahead of them at a premium, instead of buying laggards I don't really believe in just because they are at a discount.
I know traditional advice tells you not to chase stocks that have already run up, but this shift is working for me.
What are some stocks or ETFs trading at ATH right now that you think have a solid decade ahead?
When is buying the rip a better strategy than buying the dip? What stocks would you buy at ATH today?
byu/mojolakota instocks
Posted by mojolakota
6 Comments
PL, NBIS.
NOK
Statistically, momentum is a thing. So all else equal, buying at ATH should yield better returns than buying the dip. If your portfolio is 20 stocks, statistics don’t really matter, though. And apart from the momentum factor, there is generally no autocorrelation of returns. So my (unpopular) advice would be to just ignore the chart and focus on the fundamentals. I’ve had good and bad results with both investing at highs and at lows. The market is pricing the future, the past doesn’t matter.
Is the company ripping because of fundamentals (NVDA) or is it ripping because meme (INTC)?
If you bought sndk at ath 100 times the past 6 months you’d be up insanely high
I’ll only buy index funds at all time highs. At least i know there’s a good chance Ina crash it will recover and hit new ath