Its Over, page-22540

24 Aug 2023 I wrote:
Its Over, 69529279, page-18747 | HotCopper Forum

...stocks that have risen for some time become hero stocks, they're celebrated by both instos and retailers for their unrelenting growth...until the day arrives that that growth can no longer be taken for granted. They then fall and continue falling and soon they become the forgotten heroes as the market celebrates new heroes. They were poster stocks for Buy and Hold investing for the period that they could generate growth.

...New heroes are also likely to become Yesterdays Heroes in due time, reminds us not to ever fall in perpetual love with our stocks.

....What is the signal that tend to suggest that their time could be over? Its when the stock chart starts turning lower on some disappointing news, and then continues going lower....most Buy and Hold investors would just ignore that sign because they have been indoctrinated that stocks go up and down and shrug it off believing their wonder stock could bounce back. But when they didn't, it didn't dawn on them that their fundamentals have eroded, and their growth has been compromised but continue to cling to hope. Or it may the thought of CGT that deters them from taking their multibag profits. Better to pay tax than losing all those gains.

...Not many can continue to stay high like CSL, BHP, CBA. Most that grow too fast end up failing to sustain that growth.

Costa Group rose 392% over 3 years to June 2018 , then declined , 5 years later it is still -62% from its peak
All time view
CGC Stock Price and Chart — ASX:CGC — TradingView

Ramsay Health had an outstanding run with a 15 year return of 2218% to Aug 2016, thereafter 7 years later still -41.3% below that peak (never regained that peak)
All time view
RHC Stock Price and Chart — ASX:RHC — TradingView

A2 Milk also had a stellar 1031% run in just 5 years to Jul 2020, since then it has only gone downhill and remains -76.3% below July 2020 peak
All time view
A2M Stock Price and Chart — ASX:A2M — TradingView

Domino Pizza had 2 periods of strong rally, from Aug 2011 to Aug 2016, it rose 956%, then fell -50% over close to next 3 years, rising once again by 326% but fell again -67.6%
All time view
DMP Stock Price and Chart — ASXMP — TradingView

21 August 2023 I wrote:
Its Over, 70465201, page-19200 | HotCopper Forum

If you don't believe that Buy and Hold is over-rated, history has already shown this to be the case.

Some believe that it does not matter when you buy, it is what you buy. They think just buy BHP or CBA anytime if you have time, i.e not nearing retirement yet, it is all good. So let us see what has transpired so far.

Well, if you had bought BHP at its 2005 peak, 11 years later, you'd still be -11.5% down on capital, but you make up through dividends. I always felt that $50 BHP was the peak, and we're -11% down so far and a lot more catch up on the downside.
[Update: since 21/8/23, BHP is lower by -1.93% 10months later to 28/6/24]

CSL is already down -30% in just over the past 8 months. Had you bought and held from its peak in Aug 2018, 5 years later you are only 2.5% up plus dividends. Gone nowhere!
[Update: since 21/8/23, CSL is higher by +10.62% 10months later to 28/6/24]

CBA has been one of the best large cap stocks and you can compare that to atrocious WBC. Bank stocks hit a peak on 2 March 2015 and since then despite all the big profits, shareholders only gained largely on dividends. CBA is up only 6.3% since then and that is 13+ years, and WBC is a whopping -46% lower after 13 years! And they're not even businesses that do not report strong profits.
[Update: since 21/8/23, CBA is higher by +29.38% 10months later to 28/6/24]

Likewise TLS (Telstra) holders like it for dividends. So dividends you get, 8 years from its July 2015 peak, it is still -41% down, and they have had many CEOs since then. Left pocket (capital) to the right pocket (dividend).
[Update: since 21/8/23, TLS is lower by -8.81% 10months later to 28/6/24]

Well favoured ALL and REA are two stocks that showed some longer term strength, yet ALL recorded 22% gain from its peak 5 years ago, 4% pa not great. REA 36% over 3 years, that's better.
[Update: since 21/8/23, ALL is higher by +22.89% 10months later to 28/6/24]
[Update: since 21/8/23, REA is lower by +22.80% 10months later to 28/6/24]


FPH and RHC are well regarded healthcare stocks but look at how well or rather how badly their stocks performed since they lost their darling status. Their premium contracted once they lost their darling status. FPH down -9.5% from its peak 4 years ago and RHC -40% below its all time high 7 years ago. Continue holding them thinking they still make money so their value would get better does not resonate.
[Update: since 21/8/23, FPH is higher by +34.41% 10months later to 28/6/24]
[Update: since 21/8/23, RHC is lower by -13.42% 10months later to 28/6/24]


Even staple and recession proof WOW isn't all it is cut out to be. 2 years from its Aug 21 high, it remains -13% down. And 9 years from its 2014 peak, just 25% higher. Thats 2.7% per annum.
[Update: since 21/8/23, WOW is lower by -9.53% 10months later to 28/6/24]

WDS makes bonanza profits from high oil price but it is just 1.4% higher than where it was pre-Covid in Jan 20. And still well below its $65 peak price in 2008 or -44% below. Oil stocks no longer seen in the same light as years ago because of the global economy's transition away from fossil fuels. Similarly WHC goes through cyclicality and showed that it is not a Buy and Hold candidate for long. Just 7% higher from its Jan 2011 peak, some 12 years ago. And it suffered a crash from Jun2018 to Aug 2020 by -83%, and a business saved by the energy crisis sparked by the Ukraine war.
[Update: since 21/8/23, WDS is lower by -26.65% 10months later to 28/6/24- I had warned about WDS back then ]

Finally, DMP shows us why it is a folly not to sell at the peak when you have it. People say that it is easy to say in hindsight, but give me a break, when DMP hit $160, they let their greed get the better of them. DMP peaked in Aug 2016 at $75 then fell badly but given another chance to exit again at the next peak at $162 in Sep 2021, 5 years later, if holders never believe in selling and continue holding forever, they are now back to $51, a -32% loss when they could have booked a 200+% gain!
[Update: since 21/8/23, DMP is lower by -25.10% 10months later to 28/6/24]

Bottom Line: It is Not Just What You Buy, It is When You Buy. But most importantly, When You Sell. And if You Don't Ever Sell, don't think you can be Warren Buffett because history has shown that holding even the best businesses for longer is not as lucrative or profitable as it is made out to be. And these stock performance is based on market conditions the past 5-10 years, do you expect the next 5-10 years to be better than what we've had the previous 5-10 years? I think not. If you do not agree with that, I'd suggest you get more involved studying macro conditions and stock valuations in the current economic and market environment.

Update: In 6 cases of the above 'good' stocks, they fell since 10 months ago despite XJO being +9.15% higher since 21 Aug 2023, and 5 cases they have gained. And they ranged from -26% to +34%. But over an extended period of time, they were far from great, in fact abysmal.