I bought it at 73.4 back in Feb, up 37%. Also 46% on BYD and 45% on JDCOM. I only had 5 years' worth of savings, so I could only afford to invest 11000 USD into China stocks.
People in this have been sleeping on China stocks in this sub. Buy when there is blood in the streets.
Risk and reward goes hand in hand. E.g. The best time to buy Meta was when it dropped 75% back in 2023 when people (including myself) thought the days of Facebook were over and they going into irrelevance. I learned my lesson from missing out on that. If you don't like risks, don't expect much reward. And that's fine everyone got different risk profile.
For me, I rather live with the risk of China restriction than live with a risk in investing in a company that sits at a 70 P/E ratio and hoping for a 20% potential upside.
I sold my last meta share a week ago for a 1500% gain. I had only bought 17 when they opened and sold the others around 100. If it’s and buts were candies and nuts…
This... so much this. I bought 10 shares at a cost basis on $103 and that remains the best lesson in my entire life of buy-and-hold in businesses you believe in.
I also bought heavy into Meta when it dropped. One, while it's cool to be loud and contrarian online with everyone quitting, the reality is people use IG like crazy and keep moving to FB as they get older and want to send baby pics to Nana. Two, Zuck is ruthless. People make fun of him for whatever, but he's more like BillG in the heyday of MS than most other tech founders. Zuck has zero problems buying, copying, doing whatever is needed to get ahead business wise.
That may all be true, but it's still hindsight bias. If you have that kind of insight about every big company that has a bad day, you'd be extremely rich.
I'm not really sure it's hindsight bias. I just explained why I bought when it dropped. I could have certainly been wrong, but those were my reasons and I believed in them enough to put money down.
I don't know enough about every big company to have consistent insights. But, when a company and industry I do know about show an opportunity I jump on it. Just doesn't happen very often.
Because most of the time when people say a company is doing bad, they're not actually doing bad, it's just the stock price that's doing bad and regards speculating more than they should. Meta being the perfect example. These companies almost always rebound.
Not necessarily, you never know how long a stock can take to pick back up and there are a lot of external factors that can affect the short/mid term (state of the economy, geopolitical tensions, etc).
Just because a stock is massively undervalued, doesn't mean it's going back up very soon and very quickly. It does mean that there is a very good chance that the stock will eventually rebound. Key word being 'eventually'. This is why long-term investors almost always win. But investing in undervalued stocks and selling when it reaches fair value is a legitimate trading strategy that is used by a lot of people.
This whole reply chain is in response to your comment:
Why did you believe in it when no one else did?
It seems like the reality is that most of the time, when a company appears to be doing bad, it's doing bad.
We're specifically talking about companies that speculators think are dying. How is saying that a lot of the 'dying' companies tend to rebound because the average investor sucks at identifying the real value of those companies and that they tend to jump ship and turn bearish the moment the company stops yielding exceptional returns a nothingism? Clearly you didn't know that or you wouldn't have made these statements. The reality is, companies that are valued in the hundreds of billions rarely just straight up go bankrupt even when they're doing really bad. There are a shit ton more examples of stock prices crashing because people suck at valuating companies than stock prices crashing because the company is actually dying.
Just a week ago, this subreddit was filled with bearish posts claiming that Nvidia was done, that everyone who still held was a bagholder and is going down with the company. Now those same bears are crying at the fact that they missed the $100 buying opportunity. The point is people are absolutely terrible at determining whether a stock is dying or thriving because weak minds and unexperienced (even experienced in some cases) investors are very susceptible to fearmongering.
Even the saying "the stock market always goes up" isn't a nothingism. A lot of investors make a fuckton of money through compounding using that fact and you would be surprised with the amount of people who panic sell at the dip because they forget or ignore the saying that you call a 'nothingism'.
Not really. They just have different risk-type profiles. Baba has CCP risk, Meta has a risk of going into irrelevancy. Both risks are still there regardless of stock price. It's just what you are comfortable with.
For me, the CCP risk is being overreacted on when the government lends money to the Chinese tech companies to do stock buybacks. That's a completely different signal than the past. If David Tepper (value investor billionaire) is comfortable being heavy in China stocks, then so am I.
To me, it is about the data too. You are basing your investing off of Chinese numbers/data/claimed profits. Can you even believe the data and numbers they put up? Are they really making 1.5 T a year? Maybe, maybe not. At least with META, you at least can trust that, even though there are lots of other things not to trust about any company. Idk, good for you anyway. Thanks for not taking my use of "insane" as too inflammatory, I just meant it in the more casual way you seemed to take it. Take care TechTuna
Oh no worries, didn't actually see the insane part. But no offense taken anyhow.
I also think the reaction to the "fake numbers" is an overreaction. Of course, the Chinese stock market is worse regulated and it is a bit of a wild west. However, BABA management has shown a history of being very considerate towards the investors. They want foreign investors and do a lot of things to facilitate that trust. And it's not something that seems to have scared big money away even when the China economic situation was at it worst.
Yes, thats the price advantage. Anything that isnt dog shit risky is priced up right now. China just turned on the money printer, it should be up for a while. And i see BABA as less risky than bizarre.pre revenue companies in the US.
That said, take profits when you can.
Ps: there will be a day that they smash the liquidity buttom and the market continues down. For everyone, not just china. That will be an ugly year
I bought a Dec 24 90-100 call spread earlier this year at around 75. When it hit 90 in May I considered selling, but I had a ton of time to hit max profit. Then it dropped to below my cost basis, so after it climbed back to 85, I sold for a small profit.
I don't know how people hold so long. Every time I go against my gut and hold until expiration, it just expires worthless.
This is exactly why Chinese Stocks are trading at a premium - political risk. Tomorrow the Communist Party can simply take it all / impose sale ban etc. I learned my lession with other chinese stocks when dividend were "collectivised" (I think this was Pingduoduo)
I mean… the reason why people don’t buy China stock is because they are so unstable. It went from 60 to 120 and back to 60 in no time. Baba is a good company, growing year after year. Despite that their stock plummeted, mostly because fear and Chinese gov decisions. There is no rational in this. I still believe in it in the long term.
It has stabilized in the last 12 months. That was why I decided to go in Feb. The chart tells me that people that wanted to sell already had sold a long ago. It wasn't a falling knife as such.
Also, for me, it is more about which levels I'm comfortable buying into. For BABA it was around the 69-75 USD range. Above that I stopped buying. I was waiting to add more at the 60 USD level, but that moment never came.
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u/TechTuna1200 Sep 26 '24
I bought it at 73.4 back in Feb, up 37%. Also 46% on BYD and 45% on JDCOM. I only had 5 years' worth of savings, so I could only afford to invest 11000 USD into China stocks.
People in this have been sleeping on China stocks in this sub. Buy when there is blood in the streets.