How to spot hyped stocks

Well, In 2015, November 28th I wrote some posts about the hyped stocks Fingerprint and Sensys Gatso Group. I wanted to warn new beginners that the current stock price was insane, and if they wanted to buy or keep this stock, they should be aware of the risk.

Unfortunately, I see a lot of people doing the same mistakes again with new stocks, so I wanted to share my previous post. Remember, I only wrote this to warn people.

You can see the stock price when I wrote the posts and the current price.
Fingerprint:
Sensys Gatso Group

This is what I wrote:

I hope for all beginners sake that their positions stabilizes and don´t fall more, but think about the situation:
You have just bought a company, say Sensys Gatso Group or Fingerprint Card, because a lot of others have done the same. And the majority, almost all are beginners. For most people it looks like you have no clue when to buy or sell, which is not strange at all. Finding the right valuation / price of a stock is insanely hard. One thing is if you are planning to sit over a longer time, but when you speculate in 1 month, 2 months or 6 months forward it´s very difficult.

I also get concerned when I read comments like: “Help, Should I have ice in my stomach or should I sell?”, “The stock is in free fall, Why ???”, “I think we shall up tomorrow, definitely” etc.

It suggests that the person does not have control over the situation, and I mean that´s the time when it´s right to sell or reduce the position. One way of looking at it:
I am glad to be on this rollercoaster, but I would never put all of my money here, but damn it´s fun”. And that´s a part of the game. It´s happened several times before, with Funcom that went straight up to 22 kr before it fell down to 1 kr. The coffee company Zinzino was a major topic and people were hoping that it would reach the sky. Well, these guys are still waiting.

Yeah, even the tulip mania in 1637 when prices were tenfold the annual salary of a teacher.
People join rallies without knowing what they are buying and suddenly one day everything is over.

Remember this: Entertainment costs

2 comments

  1. Hi, there.

    Great post – not really sure where I am – probably around 2A and B

    A quick question – what do you think about Index Investing?

    A lot of early retirees have as their sole investment when pulling the plug.

    1. Hey!

      Thanks, but did you mean to comment on this blog post? Sure it wasn´t “my story” ?

      And could you please tell more a bit more about your third sentence. Didn´t catch that.

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