One thought every newcomer has when they join FI is- have I missed the boat? They hear about the tens of thousands, sometimes hundreds of thousands made in profit and think, “yeah, but there isn’t the opportunity to make that now.” And there they would be dead wrong. Probably not since they early days of FI has such an opportunity to make big money come along.
A perfect storm of Covid and order books teething issues have driven prices lower than they have been relative to dividends, probably ever. Has there ever been such jaw dropping value? Many players are remarkably cheaper than before dividends were doubled.
My day job is property investment, and after the 2008 crash, the amount of value was staggering. I wince as I walk past houses that I viewed back in 2009, and see they have almost doubled now. But at the time, ppl moped around like it was the end of the world, and property would never recover. (The fact there are property cycles roughly every 18 years was beyond them. 😏)They were as pessimistic as they had been pompous, puff chested and over confident just a year before, when property was flying. Everyone was slapping themselves on the back, telling each other what a fantastic job they were doing and how property would never crash again. Ppl had been queuing around the block to buy second rate, over priced property. The problem is ppl are just too over emotional and need the support of others to validate what they are doing. When others buy, they feel reassured and buy also ; they feel emboldened, running with the herd. But when others sell, they feel scared naked and alone and sell! The fact is, the value is there. There is no denying that. Eventually the sheep will move in and start munching on the sweet, dividend rich grass and others will join. And soon the value will be gone. The opportunity will be gone. And the ppl who missed out will go back to moaning how good breaks never come their way.
In a years time, when most players will have doubled, ppl will be sick to the stomach looking back at some of these prices. Because as IPD’s end, and NASDAQ flattens out the creases and trading returns to normal, one thing will be certain- big money will flood in to fill the value. With average players returning 20-30% in divs alone, this is a rare Golden Opportunity and it won’t last long.
