The Next Big Thing

  • Posted by
  • on February 25th, 2014

People ask too often what the next big thing is. Sometimes the next big thing is the last big thing. Some trends last a lot longer than anyone could expect or comprehend. This is why, sometimes momentum investing could be considered a contrarian approach. Staying with a powerful trend is psychologically more difficult than staying on the sidelines or shorting. Stocks like $TSLA and $PCLN are recent examples of that notion.

Financial markets are often forward-looking. Sometimes, they will go way ahead of themselves and discount a future that seems unattainable at the moment.

In the late 90s, people thought that the Internet will change everything we do. Those people were right. It just took a lot longer that most expected. In between the perception and the reality, there were two deep recessions that bankrupted a lot of companies and obliterated a lot of dreams. Those businesses that survived, thrived and brought substantial wealth to their shareholders. The stocks of those companies spent a lot of time on the 52-week high list.

Sometimes, financial markets will discount a future that will never happen, but the money that could be made while the whole discounting process lasts, is real.

The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

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