Buy the Post Bubble Collapse

06/18/19 • 7 min

While the overall market is great at consistently building wealth over long periods of time, individual sectors and stocks will have a far more volatile time. Capital moving from one area to another quickly can often lead to huge overvaluations that then result in drops that are just as large.
In Wall-Street speak, this move far outside the norm is a bubble. While buying into one seems like the right idea at the time, usually under the guise that “everyone else is making money!,” investors can often get better prices waiting for the bubble to burst.
Tech stocks slid an average of 80 percent after the tech bubble in 2000. Buying surviving companies like Microsoft, Apple, and Amazon then would have led to tremendous wealth creation.
Housing prices, in terms of price to income, had a bubble of their own, and in many markets housing prices fell by at least 50 percent. Buying a second home as a rental a decade ago would have created a lot of wealth—and income—for someone without having to even touch the stock market.
Today, one of last year’s bubbles, in the cannabis space, seems to be getting close to a bottom. Many of the players, big and small, have fallen 70-80 percent from their highs or more. And even tobacco stocks have struggled here, on news that they don’t want to get into the space yet!
However, the fear right now, after the collapse, is a good sign that it’s time to buy. There may not be a rapid rise here again like there was during last year’s bubble, but today’s prices are so depressed that they represent a good long-term entry price in a rapidly-developing new market sector.
Not sure the best way to get started? Follow these simple steps to hit the ground running...
Step #1 - Get These FREE Reports:
Big Book Of Chart Patterns: https://reports.tradingtips.com/big-book-of-chart-patterns
The Ultimate Stock Trading Toolbox: https://www.tradingtips.com/ultimate-toolbox/
10 Great Stocks Under $10: https://www.tradingtips.com/10-great-stocks-to-buy-under-10/
7 Cheap & Good Stocks: https://reports.tradingtips.com/7-cheap-stocks
Step #2 - Join Our Premium Advisories:
The Next Superstock: https://www.tradingtips.com/3-disruptors
Triple Digit Returns: https://reports.tradingtips.com/pot-mania/
Step #3 - Connect With The Community:
Trading Tips Official Facebook Group: https://www.facebook.com/groups/tradingtipsdotcom/ .

Next Episode

Invasion of the Unicorns

In Silicon Valley, there are hundreds of privately-held companies known as “unicorns.” That’s a term for a company that has a valuation of over $1 billion based on the last round of equity they sold to private investors.
Many of these unicorns will continue to grow and increase in value. Others will fail. A handful will go public. A few have already gone public this year, with more on the way.
Some of the biggest names this year have been the ride-sharing companies. In this space, the biggest company in terms of market share is Uber (UBER). However, it let competitor Lyft (LYFT) go public first—and given how Lyft shares have failed to rise past their initial publicly-traded price, Uber shares look likely to do the same.
Given how Uber’s market valuation is nearly $60 billion in spite of a weak IPO, however, investors may want to look elsewhere.
At a $60 billion valuation, the company still doesn’t make money, and has even indicated that it may never make money. That doesn’t mean it will fail anytime soon, but it does mean that the best thing Uber can do for folks is save them money on rides compared to cabs.
Investors looking to tackle a high-valued company going public would be best to look elsewhere and away from bigger and more well-known names to avoid the risk that comes from buying a highly-valued firm to begin with.
One alternative is Beyond Meat (BYND). Although the company just went public and its shares have doubled, its overall valuation is more reasonable. It’s on track to move from generating revenue to actually making a profit and having earnings for investors.
And it’s just scratched the surface of its market potential in plant-based meat alternatives. That’s a far cry from the saturated ride-share market where the biggest names went public at hefty valuations.
In investing as in time, it’s all relative. And relative valuations matter. If you’re looking for a new play in today’s booming market, look no further than some of the smaller IPO plays out there like Beyond Meat.
Not sure the best way to get started? Follow these simple steps to hit the ground running...
Step #1 - Get These FREE Reports:
Big Book Of Chart Patterns: https://www.tradingtips.com/book-of-chart-patterns/
The Ultimate Stock Trading Toolbox: https://www.tradingtips.com/ultimate-toolbox/
10 Great Stocks Under $10: https://www.tradingtips.com/10-great-stocks-to-buy-under-10/
7 Cheap & Good Stocks: https://reports.tradingtips.com/7-cheap-stocks
Step #2 - Join Our Premium Advisories:
The Next Superstock: https://www.tradingtips.com/3-disruptors
Triple Digit Returns: https://reports.tradingtips.com/pot-mania/
Step #3 - Connect With The Community:
Trading Tips Official Facebook Group: https://www.facebook.com/groups/tradingtipsdotcom/