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> This is all "speculation". You're not basing the stock price on earnings but intangibles. Yes, it's absolutely (informed) speculation. This is how the stock

> This is all "speculation". You're not basing the stock price on earnings but intangibles. Yes, it's absolutely (informed) speculation. This is how the stock market works. Amazon, Apple, Microsoft before them, Google... people said exactly what you are saying about how they were valued at some point in time. Every single stock is valued based on how stocks will perform in the future. Last year's performance is only interesting for informing investors of what the next 10 years will bring. I do think Tesla is a risky stock to own (I do own some shares), but it always has been. Likewise Apple was. And Amazon. If you want big returns you often hang on to the riskier stocks for longer than you are comfortable. (Not always and you cash out)

moate 6y ago
I'm aware of what gambling is, and all the forms it can take from rolling dice in an alley to investing in the stock market. Your first post was trying to differentiate GameStop from Tesla. Neither have assets that support their price or that there is something inherent in the company to support that value. They don't. They have projections(Tesla) or excitement(GS). Throwing up a bunch of survivor-biased stocks to prove that sometimes people make winning bets (or rather, that some best win) doesn't mean anything. Amazon, Apple, MS all eventually moved past speculative and most people in the market would assume that they're pretty stable blue chips (in fact, that's why we have terms like "blue chip" in the first place) with assists that support the price. I'm not talking about how to make big money on stocks, I'm talking about the idea of inherent vs projected value. You said you think Tesla is risky, and that's my point. It seems much more likely that someone (car companies, energy cos, the government) would come in and kick the legs out from under Tesla than any FAANG company at this point (except maybe FB but I might just be projecting there)
- ogre_codes 6y ago
  You are missing the entire point here. Stocks are not valued based on what they earned last year. They are valued based on whether people think owning them will earn them a profit in the future. You can certainly wait until a company has proven itself to invest in them. The problem with that is you will never get more than marginal returns. If you waited until Amazon was fairly valued, you'd probably still be sitting on the sidelines. Likewise with Apple. If you want guaranteed returns, you buy boring things like utility stocks and accept your 4% dividend and 5-10% growth. If you want bigger returns, you absolutely have to invest in things which some people consider over-valued. There is no other way. You just have to be good at picking which companies are going to be successful. Tesla, the jury is still out. I'm playing with the house's money at this point though. I am confident they aren't going to crash and burn entirely though. Comparing them to Gamestop doesn't make sense. Outside Reddit, there is no story with Gamestop. Tesla has products and growth, it's just a matter of finding where that growth ends.

moate 6y ago

I'm aware of what gambling is, and all the forms it can take from rolling dice in an alley to investing in the stock market. Your first post was trying to differentiate GameStop from Tesla. Neither have assets that support their price or that there is something inherent in the company to support that value. They don't. They have projections(Tesla) or excitement(GS). Throwing up a bunch of survivor-biased stocks to prove that sometimes people make winning bets (or rather, that some best win) doesn't mean anything. Amazon, Apple, MS all eventually moved past speculative and most people in the market would assume that they're pretty stable blue chips (in fact, that's why we have terms like "blue chip" in the first place) with assists that support the price. I'm not talking about how to make big money on stocks, I'm talking about the idea of inherent vs projected value. You said you think Tesla is risky, and that's my point. It seems much more likely that someone (car companies, energy cos, the government) would come in and kick the legs out from under Tesla than any FAANG company at this point (except maybe FB but I might just be projecting there)

ogre_codes 6y ago
You are missing the entire point here. Stocks are not valued based on what they earned last year. They are valued based on whether people think owning them will earn them a profit in the future. You can certainly wait until a company has proven itself to invest in them. The problem with that is you will never get more than marginal returns. If you waited until Amazon was fairly valued, you'd probably still be sitting on the sidelines. Likewise with Apple. If you want guaranteed returns, you buy boring things like utility stocks and accept your 4% dividend and 5-10% growth. If you want bigger returns, you absolutely have to invest in things which some people consider over-valued. There is no other way. You just have to be good at picking which companies are going to be successful. Tesla, the jury is still out. I'm playing with the house's money at this point though. I am confident they aren't going to crash and burn entirely though. Comparing them to Gamestop doesn't make sense. Outside Reddit, there is no story with Gamestop. Tesla has products and growth, it's just a matter of finding where that growth ends.