Hi @Andredamus
The beauty of investing is that so long as our mistakes do not result in a total wipe out and we are able to retain a stake in the game, then there will always be an abundance of multi-baggers just waiting to be discovered.
It's great hearing from all those who have paid off their mortgages, quit their jobs, and treated themselves and family, all off the back of investing in a single company. It's the freedom I value most from being a full-time investor.
I'm not sure if you're familiar with the book; The Gorilla Game which was first published in 1998? It's a must read for any tech investor. A pathbreaking text, which provides a relatively straightforward framework that most investors could apply to some degree as its not too onerous.
I'd be interested in hearing from others who've had success with applying the Gorilla Game framework to ASX investments. ALU and XRO are some established companies that immediately spring to mind, but many emergent gorillas will remain below the institutional radar which is the best time to start building a position. In essence, the guiding principles are:
"1. Identify consumer markets which are just in the process of
transitioning into hypergrowth.
2. Buy stock in all companies which supply products into the
market, and which have a legitimate chance at becoming a
gorilla.
3. As a gorilla or market leader emerges, sell all other
competitor’s stock and consolidate your personal stock
holdings in the gorilla.
4. Maintain a long-term investment horizon.
5. Only sell your gorilla stock when a new category emerges
which threatens to eliminate the gorillas customer base."1998 - The Gorilla Game summary.pdfFollowing these principles, I previously held a basket of BNPL stocks including Z1P, SZL and SPT, although there was never any serious contemplation that the latter two would develop into notable challengers. As you note, Z1P now has much better prospects and Quadpay's 200% YoY growth is very impressive. However, once I'd made the call that Afterpay was the undisputed ANZ market leader (with sound prospects that this would be replicated in other territories), I sold out of all my Z1P holdings. Full disclosure: I shorted all three last year, but don't have any interest at present.
I can understand why you're reappraising Z1P and if it can gain enough momentum to break out of its four month base then there is a good chance of securing some market beating returns - perhaps even outperforming Afterpay over the next 12-24 months if Quadpay can maintain hypergrowth. However, you'll be able to detect from my view of Z1P is that it ought to be only considered a shorter-term investment play. As you mention, the superiority of Afterpay will ultimately prevail and it's my view that Afterpay's market returns will be superior over a 5+ years timeframe.
May I ask, are you considering further trimming your Afterpay holding to free-up cash to invest in Z1P or deploying cash on hand to invest in Z1P? The former is contradictory to the approach I take, but I can see the merits of the latter.
