I know there was some talk about "3D" printing -- and it's investable "growth" in that industry.... Can't remember who was in or out of it... and that's not even a point here. But here is why I can't afford to gamble on this kind of stuff...
The actual company "3D" (DDD) is down 51% year to date.... and now reported "slower growth".....
Remember the discussion about stocks being "priced for perfection" and what happens if they're not perfect plus some? You get killed... The stock was down almost 10% just today.
I can't afford to invest 100K in a name and get cut 50% or 10% in a single day. So I stay away from them. Down 50% YTD kills 10 other names in your account that are all "okay"!
I AM NOT SAYING to not invest in this name - or the industry - I'm just using this as an example of what happens when you buy stocks -- pick a name and pick an industry -- that is in that "priced for perfection" / "momentum" / "hype" stage.
Hell yeah you can hit a home run.... you can also loose a lot of money very quickly. So if you play in this stuff... do so with a very small percentage of your investable assets. Odds are against you. And here's why..... remember me telling you that when the clerk at the grocery store starts talking about all the money they've made lately in "X"?? And that's when you run for the hills!!
When I hear the talking heads all touting "3D" printing (not this company in particular - just the industry in general) and the big stock gains.... that's when it's too late to get in.
You have to be EARLY to this kind of stuff -- not after it's big news. If you bought at $8 and it runs to $80.... you're a winner.... but if it runs to $70 and you jump in - watch it go to $80 and then plummet to $45.... that SUCKS!
I'm not smart enough to know what's ahead -- I can't spend enough time to try to be "out front" of this stuff... So I shy away from it (or similar). By the time I'm aware of the phenomena - it's too late to be investable. It's why I invest in British Petroleum and then just go play in the shed....
Last edited by GregWeld; 04-29-2014 at 02:36 PM.
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