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Hi all,
I've been investing for about 10 years, but buying individual stocks for only about 5 years.
During my investing career so far, I've found that big tech stocks that have taken disproportionate hits to their stock price were my best opportunities. If a tech stock has a great business that prints cash with good YoY growth and forward PE, but lost value due to uncertainty or other external factors, I identified those as the best buying opportunity.
My personal experience was as follows.
I had $150k in VOO in October 2022. After seeing the META stock crash to below $100, I sold my VOO and fully ported into META. Sold my META stock early December 2024 for around $600. This allowed me to 6x my money to $900k. After taking out some money for the taxman and some home renovation, I moved the remaining $750k to VOO once again.
My second opportunity came during the April 2025 dip. When Google dipped to under $150, I sold my VOO at around 10% loss and loaded up my entire portfolio with Google stock worth around $660k.
Now I'm on my third opportunity. After I waited enough to make sure that my Google sale would be taxed as long term capital gains, I sold my entire Google portfolio at around $315 and moved almost my full port of $1.1MM to Microsoft at $370. I'm expecting another 50% gain from this play in the next 2 years.
If a company has a great business, huge moat, and good revenue growth, but is beaten down by external factors, there seems to be great opportunities to make it out like bandits.
There are a lot of tech companies out there, but I'd never touch something like ADBE with a ten foot pole. I worked in the tech sector all my life, and I won't invest in a product I don't believe in. You have to
1) Identify a pool of tech companies in which you have very high conviction as to the viability and growth of their business. Tech is the current stock market trend, and volatility plays in your favor if you find a good entry point. I honestly prefer companies above 50B market cap, instead of small to mid cap stocks.
2) Wait for the right buying opportunity. For example I also considered buying NFLX when WB acquisition talks dropped their share price to below $80. But I ultimately decided not to buy it as I would have to pay short term cap gains tax on my Google sales, and the price of WB was indeed a bit too high for what was on offer.
3) Invest as much as your portfolio as possible, depending on your risk appetite. I don't buy a stock that I wouldn't be happy to hold for 3-5 years.
4) Take your gains/losses when market presents you with a better opportunity for making money. Opportunity cost is a real.
5) Don't buy high and sell low. Seriously. Don't buy individual stocks at ATHs. Keep your money in an index fund until there is a sufficiently attractive investment opportunity. If that means waiting a year or two holding VOO, that's fine.
6) Don't use options. Your thesis might be right, but timing could be wrong, thus theta decay can melt your money like butter. You can write some covered options for extra money, but personally I didn't want to take the assignment risk for any of the stocks I had.
7) Don't risk your retirement savings. You'll need that when you're old. I do all my trading on my taxable accounts, and my 401k/IRA are just broad market index funds.
This seems to be the best way I've found to make money from individual stocks, instead of just buying VOO with every paycheck and chilling.