Are these holdings embarrassing?
Take a look at my super boring non-tech portfolio. I feel like such a dork.
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Of course the trading app has Socials 😒
🇦🇺♂️ Former professional investment wanker. Now I just do it at home for fun
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scarlight : hmm, the issue is what do you want? you want constant gains with good resistance or high gains high losses like technology stocks.
Warren Buffed : Its not embarrassing,, at least green bro
Warren Buffed scarlight : His portfolio tracks BRK constituents... Defensive, impressive
Nisdey OP scarlight : I was being a bit facetious. I'm almost 40 and desperately trying to hold on to my youth by pretending to be naive and trendy.
scarlight Nisdey OP : hmm, well then what you are doing is quite right to be honest. I'd you feel adventurous maybe buying Apple, Amazon shares.Nvidia is fine just wait for it to be a little bit more stable.
Nisdey OP : I have my reasons for avoiding Apple at the moment. I would advise getting out before the numbers are back on sales of the new iPhone 16 and the M4 Macbooks. Like NVIDIA, their problem isn't necessarily their profitability, it's that the market has factored an unsustainable rate of growth into their price.
Nisdey OP scarlight : NVIDIA will be fine for the next year or two, unless its price gains slow down to align with its real underlying value.
It's the same reason that proves that Pyramid schemes don't work. If you take the integral of an exponentially increasing series, you quickly run out of dollars in the world after 2 or 3 iterations. As such it's impossible to double its growth rate every year forever, which seems to be what the market expected, if an earnings call like that caused a drop in price. It's as if everyone knows its a bubble, and are trying to have a sustainable bubble that will stay overvalued forever.
That's also the reason people like Sam Altman are frantically running around telling anyone who'll listen that ChatGPT 8 will be an existential threat to humanity, capable of producing economic value equal to several organisations worth of humans. What better way to keep the hype train rolling.
scarlight Nisdey OP : Hmm, that is a new take. However, a bubble does not have consistent income and cash like Nvidia.
Also if everyone sees it as a bubble and takes away their funding like rich hedge funds right now. It is no longer a bubble.
Also I will consider getting out of Apple in the near future, thanks.
Nisdey OP scarlight : I posted this in reply to something else before. But I think it may be relevant here...
NVIDIA has been over-valued for a long time, but the reason is a 2nd order integration problem (taking the area under the graph of an exponentially increasing series for those who don't speak math), nothing to do with what's happening in the present moment.
The best way to view NVIDIA is as the modern day equivalent of Cisco during the .com bubble.
Cisco was making real money selling networking equipment to .com companies who were adding no value.
Look at $Cisco (CSCO.US)$ valuation from 2000 to now.
It took 20 years for Cisco to regain their peak value they had in the year 2000, without adjustment for inflation and despite making the same profit (in fact still growing, albeit at a normal rate).
They have been profitable right throughout the entire time, and even make more than double the profit now than they did in 2001.
The problem was an expectation by the market that the rate of revenue growth in an emerging technology will continue forever and not plateau as the industry is commodified. This is why NVIDIA is overvalued, because the current price assumes Superliner growth, which translates into exponential total revenue. which is impossible.
This is the same for all those $500 pandemic stocks that are now worth 1 / 10 of that. if you bought in 2021, and hodled during that decline, you won't live long enough to get your money back.
I hope this explanation helps people understand what these arrogant clowns are referring to, when they say that long term NVIDIA investors are stupid.
scarlight Nisdey OP : uhmm hmm, yes and cisco comparing to NVIDIA is not exactly the same. I appreciate your idea of EPS valuation but NVIDIA is having good products and a lot of cash on hand, Cisco never has that.
P/E ratio of Cisco was 200 and NVIDIA is just 60. So mathematically, they are not the same.
By the way Cisco is just pure hype they don't have many products to offer and people just jump in.
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