I think I've said this before --- and I think everyone should have and know how to use various "metrics" for helping to make a judgement call. The only thing I would ADD to this is --- don't let metrics over rule your head/gut. When you're buying risky assets... ONLY YOU can live with the result... and if you let metrics talk you into something you really didn't want in the first place... then when it goes south - you'll tend to cut bait -- and kick yourself while you watch "the one" your really wanted to buy - go ballistic.
Growth stocks don't trade well on "metrics" - they trade on momentum... they trade on fear (fear of missing out and fear of being in front of a train)... they trade on hype... they trade up if the talking heads like 'em - and they trade down if the talking heads don't.
Personally --- I like it when people are buying or talking about buying or using the stuff they produce... and sometimes you miss the first legs up because I want to actually witness what's taking place in the real world. I want to see a two block long line out the door (Chipotle and Apple)... I want to see an actual consumer shift (NetFlix). I don't need to be the first guy in and GUESS with my money. GoPro is selling like hot cakes -- has the lions share of that market... buy after the HYPE left... it's done nothing but drip red ink after it's quick rise. Maybe the market is smaller than the P/E can achieve IDK. Tesla -- they're killing it... the car(s) are fantastic.. it trades at a ridiculous P/E... but all my friends seem to want one. To me - that's a good thing (I don't own it). They have a very expensive build out to be a real mass produced manufacturer and I would expect a ton of hiccups.... FaceBook seems to have real lasting traction. I don't use it - so am not buying it - why? Because I won't know when or if it's going to fade into the sunset.... But I think it's a real company and "everyone" is using it. So I miss out... I'll live just fine. I can't own them all and don't want to.
These are all risks -- take them at your own speed.... be sure you want to live with them while they suck.. because usually this stuff drags you down - and then just about the time you're ready to bail and take the loss... they jump 10 points. Or.... they just drip and ooze and cause your stomach to burn. LOL
Sometimes it's just fun to see if you're right. Just don't be upset when the market hands you your ass, it will NOT be on a silver platter. But man do you get bragging rights when you kill it with one or two.
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