Quote:
Originally Posted by yz295
I am highly invested in this sector and if my plan comes to fruition I will be able to retire very early and go camping and hunting all day! I got in right after the Liberals got into power and have planned to hold well past legalization. This sector is not for the faint of heart. Been through many, many, many ups and downs and the swings are huge. I saw this as a once in a lifetime opportunity and did do a bit of day trading but mostly investing. All depends on how comfortable you are with risk. PS I sleep very well at night!
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I’ve studied manias/bubbles and they all play out the same way, every single time. They go parabolic at the end and then fall off a cliff as everyone runs for the door.
If you got some big gains in the sector it would be wise to cut back your exposure to a reasonable level around 5-10% of your total portfolio. Don’t let greed or the fear of missing out get the best of you. The same scenario played out with Bitcoin last December. And it played out in countless other bubbles before that when you look back in history.
Consider John Doe who was unlucky to have invested $1,000,000 into Tilray at the top price of $300/share. John watched the stock plummet before the pain was to much and he got out at $112.50. He is now sitting on about $375000 in his account. It’s going to take him about 14.5 years to get back to even at a 7% real rate of return (375000 x 1.07^14.5). There is going to be lots of John Does out there when this bubble busts. Be careful IMHO.