Yes, that's the risk I'm taking. I risk being out of a stock that I think has a great future, in order to try and get a lower cost basis. And, you are right, the potential is only for a 10-20% reduction in my cost basis, not an order of magnitude.
However, in my experience, investors who say, "I have to own this stock, its future is so good, I'll just ignore valuation", usually end up paying too much for it. Lots of QCOM investors on this thread have that attitude, and some of them have a triple-digit average cost for the shares they hold. I went back and read some of the posts from last January, and some people (no names, so as not to embarrass them), were buying out-of-the-money calls then. And some were smart or lucky enough to get in at a single-digit cost basis 2 years ago. More than any other stock I'm following, QCOM has a very wide range of prices at which investors got in.
The best part of my method is that, if I'm wrong, I've only lost opportunity, not money. And I know I'm going to be wrong in a not-small proportion of my guesses. |
