|
The story I’m about to tell you is not unique to me.
It’s the story of thousands, maybe millions, of kids across the country that stared a 30% drawdown in the face and hit the buy button. And it turned us into the generation of dip buyers that we now are.
Here’s the setup.
When: Early March, 2020.
Where: Off campus party house at Union College
In one hand: Probably holding a tall boy. Maybe lime flavored. Not the point.
In the other: And this is the important part, I’m buying Boeing below $100 with the last of my camp counseling money from the previous summer.
Why below $100?
Because that’s all I had in my Schwab account at the time. And the stock price literally dipped far enough for me to buy a share.
I woke up a few weeks later to a 100% gain.
True story, and I tell it because this is the formative experience that turned myself and millions of others my age into what I now call the Buy The Dip Generation.
It wasn’t just me. I can tell you this for a fact because I was there. We developed a “Covid reflex.”
I want to bring you back to some of these blowups during Covid. These were the hot stocks people were buying. I know because I was there.
Tesla fell 61% in the 30 days leading into its Covid low.
30 days later it doubled.
Imagine yourself as a 20 year old College student seeing this unfold in front of your very eyes.
I’ll tell you what went through my head: “screw an economics major. And why am I even in this Ancient Greek history class? To make money, all I have to do is buy stocks when they blowup.” That was my literal thought process.
If I could look back and give myself one piece of advice, or a tweak on that philosophy, it would have been this: “buy a diversified basket of stocks when the market blows up.”
Unfortunately, the only thing I diversified back then was was my beer choice: regular and lime So my advice would have probably fallen on deaf ears anyways.
I made some other charts showing the massive blowups and subsequent recoveries during Covid for you as a reminder of how insane the market was.
Etsy got cut in half then doubled in a month. LOL.
Here’s the major indices. I didn’t dabble in these at the time, was more of a single stock guy. What an idiot I was.
Here’s Penn National falling 88% then tripling. I knew guys that literally 10x’ed their money in this thing.
The BTD Generation catches a lot of flack. And the Tiktok dances on public transportation don’t help. Z’s, let’s stop that.
But here’s one thing we can’t catch flack for. When shit hits the fan, our (learned) reflex is to pull out our phones, select our favorite investing app, and smash the buy button.
You can’t take that reflex out of us.
Thank you for reading!
If you enjoyed this post, consider forwarding it to a friend or colleague. It’s much appreciated.