If you put $10,000 in Apple on its first day if trading……and put $10,000 in Invidia on its first day of trading…..those stocks would now be worth over $65 MILLION DOLLARS! Unbelievable.
OT: Shocking stock market information
- Thread starter The Spin Meister
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The only problem is that few know which startups and early phase companies will pan out and many go under for every 1 Apple.
Further complicating things for your average investor is that there are many companies that become insanely successful that have gone through a period where it looks like they would go under such as the Monster bankruptcy you point out.
These "if you had put X into Y, Z years ago" statements almost always measure from the lowest point to the high. What if instead you had put $10k into Monster before it went bankrupt and lost it or worse yet sold taking a huge loss and then watched it rocket over the next decade?
And
The son of my college roommate bought four bitcoins at $400 apiece. Sold two at $1,000. Was happy then….. kicking himself now!
Another issue is that no one would have put in ten grand and let it ride for twenty years. I, and almost everyone, would have taken some profits and been happy. Likely would have sold a hundred thousand when it hit five hundred thousand or at a million. Would have had serious impact on those returns.
The son of my college roommate bought four bitcoins at $400 apiece. Sold two at $1,000. Was happy then….. kicking himself now!
Speaking of bitcoin, I've done some analysis of previous halving events, prices before and after. I've also graphed the spikes post-halving and extrapolated for the latest halving. The price usually peaks a year or more after the halving event. The extrapolated price I get should this halving event follow the pattern is $130k - $160k in 2025. Now, I don't know that the pattern holds, but it is my prediction.
The price spikes on bitcoin post-halving events seem to be diminishing with each halving event. After the first, it was a 8760% increase. The second was 2570%. The third was 594%. We'll see what this one works out to be, but I calculated 114% as the next increase and graphically the spike seems to fall in the $130k to $160k range for the next peak.
Another correlation that I found, the first GME spike was JAN21. This was a couple of months after the last bitcoin halving. It was also a couple months before bitcoin had it's first big post-having spike. So the weaker GME craziness a couple of weeks ago was also shortly after the bitcoin halving event and so the pattern albeit only 2 data points seems to hold. Also, the GME spike was more tame than the one in 2021 which makes sense to me predicting a more tame 1st post-halving bitcoin spike this round in a few months.
Then again, these predictions are based on only a small amount of data points and they may not hold, patterns change, etc.
BTW, the DOW is off another 370 points this morning. It's lost over 1500 points since Jersey Boy was cheerleading 40,000 which really amounted to a psychological number that represented a below average return over the last few years.
Two things:
IIRC Apple made a huge splash with it's Macintosh personal computers in the early 80s. Then the company nearly died until they came out with the iPod which was basically a small hard drive for people to store music. Then iTunes Store, phones, watches, etc. So who knows how to pick winners? I recall an old Barron's ad where they said you buy a stock thinking it's going to go up. The problem is you're buying it from somebody who is selling it because they think it's going to go down.
I'm not trying to pick on rumble on this board but he was all in on Tesla. His point was that Tesla was growing 50% per year which was correct. The problem was that the price already reflected that expectation so I was a bit more cautious. You could say the same with NVIDIA today which is trading at a whopping 67 x earnings.
FWIW I invested $6k in Mobil & Texaco in the early 1990s using company purchase and dividend reinvestment plans long before there was such a thing as a discount broker. Mobil became Exxon and Texaco became Chevron. I still own those companies and my $6k has grown to $150k and I stopped reinvesting dividends 8 years ago so add another $50k of cash dividends to that value. My point is that compounded growth over 30+ years can add up to a big number. Not like getting in on the ground floor of a company like Apple but a big number nonetheless.
FWIW the S&P 500 was roughly 800 30 years ago. Now it's over 5,000 and you've been paid with dividends while you wait for the growth. Furthermore you've participated in the Apple run up if you've been invested in the S&P 500. Just like Warren Buffet who's Berkshire Hathaway is mostly Apple stock.
If I'd have put $10,000 into Red Lobster on their first day of trading...yada...yada...yada....I appreciate the OP and their point but it is a two-edged sword.
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Valid point. S&P average return is a little over 10% long-term. The only thing I question is that it moves stocks out and puts new ones in therefore keeping the return higher.
If you put just $1000 into an ETF that tracks the S&P 500 in every year from the time you graduate college, you will have $1 million at age 70. If you put $10k in per year, you will have $10 million in by age 70. Einstein marveled at the power of compounding interest over a long period of time.
So check this out. It was 2000 at Penn State Main campus. For one of our Finance classes we had to invest $10,000 into the stock market and grades were going to be based on who got the best return. I kept reading that Nvidia was likely to get the contract to supply GPUs for the very first Xbox. So instead of diversifying my investments like most, I went all in on that one stock. So, I actually did invest $10,000 into Nvidia. Granted it was funny money at the time, but I recently have been thinking about what might have been!
I actually had a friend at PSU whose dad put $10k into a brokerage account and told him to learn how to invest. It was a lot of money to me at the time and obviously not so much to my friend's dad. Anyway, it got me interested in investing.
Your grade shouldn't have been based on who got the best return, especially in just a short timeframe. That's absurd. Sounds more like a day trading seminar.
The professor should have graded based on defining your investment objectives, risk tolerance, investment timeframe, etc.
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Plus, a finance class should really be focused on risk verses return. If you want the highest return, you would probably be tempted to take the most risk. But that isn't the best choice. It is the highest return verses risk for the risk tolerance of the client. The instructor maybe should have been analyzing the alpha and the Sharpe ratio for the portfolio.
What if I knew who was going to win the last 25 Superbowls man I could have made a fortune/
In 1964 you could buy a circulated $20 gold piece for $80.
Of course at minimum wage that was two weeks pay.
Of course at minimum wage that was two weeks pay.
Both of those take work. The prof made it very easy on himself…… not by accident.
Screw that. Anyone in their 20s should be going for the highest risk.
Your own logic dictates going for the highest risk for the simple fact that the upside is MUCH higher with high Risk than any downside. The most downside of any common stock is a 100% loss. The upside is in the Tens of thousands % gain.
Anyone up for that same game? We will use Monopoly money and each invest 10k. You can pick 1-10 stocks. Most email account have a portfolio tracker. We can post results by month.
Is there any websites that will track a group of portfolios? Like a fantasy football except for stocks.
Like camaccho said, if you invest 1k a year in the sp500 you will hit $10 mil at age 70. The real surprising thing is how many college grads don't hit a million.
You don't have to pick high risk ipos either. You can invest in apple, google, Amazon, and NVDA AFTER they have billions in sales. There was still plenty of room for growth when they were at $50 billion in market cap vs their current 2-3 TRILLION market cap.
I agree about being aggressive when young. Not everyone is. Some are a couple of years from or are in retirement and need to take less risk. But yes, a long investment time horizon, go big. Don't go putting it on black and letting it ride a half dozen times crazy. But buy ETFs that follow NASDAQ, tech, etc. Maybe you lose for a year. Big deal. In the end, if your ETFs have a 10-year performance of 15% or more, you will likely make it all back and then some.
Also, there are people who short stocks and their potential losses are unlimited.
I actually think kids should start investing in stocks as teens. It gives their investment longer to grow. I think they should be able to work earlier too. I am not talking about going to coal mines but kids should be able to push a broom or wash dishes during summer vacation.
An extra 6 years to grow and the money can double. That is huge.
An extra 6 years to grow and the money can double. That is huge.
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Hindsight is 20/20 for sure. I remember missing on Qualcomm 25 years ago. Nvidia I’ve been a bit luckier but things can change in a hurry. I love aggressively buying a downturn but when it starts to pay off I get stage fright.
I've had that issue of selling too soon on a really nice gain. I bought a lot of XOM when crude oil's price went negative during COVID. I knew that there was no way that would stay like that. Sure enough, crude oil went to $100 relatively quickly once economies reopened. I bought XOM, I think it was about $25. Sold at $100. At $25 its dividend was like 10% or so on top of the price gains. Anyway, I just checked and it's $113 and I could have collected another year or 2 of 10% dividends on top of it.
I bought the cruise and airline stocks during covid as well. They all were very nice gains for me but again, I probably sold too soon.
I don't think any legitimate financial advisor would suggest that people take as much risk as possible. That sounds more like speculation than investing. They would advise younger people that they have the luxury of time to withstand the ups and downs of the market and that equities have a better historical return over time than more conservative investments like bonds. They would still recommend diversification.
True, but I also like being more aggressive particularly with a long investment horizon. Of course, I also maintain a major safety net with several income streams and don't really need the money that I have in the market.
I wanted to clarify something that I saw posted earlier by someone about something that I had written. I previously posted that investing $1000 per year in an S&P tracking index fund would yield over $1 million at age 70 (if it holds to historical average returns) and $10,000 invested per year would yield over $10 million at age 70. It doesn't have to be complex. The compounding over many years does the work.
In fact, I retired at age 41 and decided to teach at a private school (I don't have a teaching certificate but had taught at a major university, the private school didn't care about the certificate) and be their baseball coach, bridge building team advisor, and science Olympiad advisor. Then I retired except for self-managing my properties at 43 after my mom's cancer made a major comeback. I haven't invested another cent since then and still grow my net worth at nearly 10% per year on average while being retired.
This was all due to being very aggressive in investing (by % of income invested, portfolio mix, and willingness to diversify into rental properties) when I first left PSU undergrad. And now I have several income streams through retirement, a growing nest egg we may never touch, and the freedom to be where I need to be for my family. It helps that my wife shares a similar personal finance philosophy. We've grown her net worth into 7 figures as well. She still works part time for her brother's businesses mostly to help him out.
This isn't related to Apple's growth over the past 40 years but I'd like to throw it out as a general comment. The following chart shows 10 year returns given different starting PE ratios. It clearly shows that 10 year forward returns aren't so great when the PE ratio is > 20%.
All sorts of measures and tests out there. We've had a bad 3+ years now in terms of comparison to historical performance against inflation. P/Es are still a little high historically. The real problem is still persistently very high inflation. It steals from all of us.This isn't related to Apple's growth over the past 40 years but I'd like to throw it out as a general comment. The following chart shows 10 year returns given different starting PE ratios. It clearly shows that 10 year forward returns aren't so great when the PE ratio is > 20%.
It's essentially a tax on every American now and in the future of 25% or so for the past 3+ years of fiscal policy insanity. We'll pay that tax on everything that we ever buy for life. Our great-great grandkids will be paying it too. There is no undoing it. Best that we can hope for is limiting the damage to what has already been done.
So you invest $50,000 over fifty years and end up with $10 million. A payback of 200-1 over a fifty year time span.
Or put in $20,000 and end up with over $65 million. A payback ratio of over 3,200 -1 over a shorter time span…….Nvidia IPO’d in 1999 (25 yrs ago) and had a better ROI than Apple by far,
Do you say a 3,200x payback over an average of 35 yrs is no big deal. 👯♀️
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