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If you want to be a great tech investor, sometimes you have to forget some of your consumer habits.
From the time we're children, we're taught to be price sensitive, to look for bargains.
That's a good idea in stocks, too – if you compare stocks' price/earnings ratios and other metrics to find deals.
But too many investors just look at the "price tag."
While comparing price tags certainly can help you out in the mall or the grocery store, it can be positively disastrous when investing.
When finding stocks, you're shopping the future – gains and losses – not the present price.
As the four stocks we're looking at today prove, it's far more important to follow Rule No. 5 of Your Tech Wealth Blueprint. That rule says to "target stocks that can double your money."
Two of the stocks we'll be looking at trade for more than $140 and two for more than $800.
Yet they've all met the mandates of Rule No. 5, and the "worst" performer in the group beat the S&P 500 by more than fourfold in the past two years.
And two of them already doubled over the period.
But they're not done yet.
Not even close.
In fact, all four stand to gain 50% or more over the next few years.
And that means these "expensive" stocks are actually bargains.
Let's take a look…
Avoid the Trap
Now, I understand why many investors fall into this "price trap."
After all, it feels "richer" to own 100 shares of a $5 stock than five shares of a $100 stock.
But we don't care about feelings.
We're looking for returns.
If that $100 stock earns 25% while the $5 stock nets 15%, the more expensive one is a much, much, much better deal.
In this hypothetical, the $100 stock earned 66% more than the $5 one. Which means you would have made $250 on the higher-priced stock and $150 on the cheaper one.
On the other hand, yes, micro caps – "penny stocks" – do tend to be priced cheaply. And, yes, those do tend to be the fastest-growing companies – and stocks – out there.
But there's plenty of penny stock duds out there. And plenty of $100+ stocks poised for triple-digit gains.
It's our job to separate this all out.
Are you "getting" the lesson here?
I thought so.
They all cost well over $100.
And they've all either doubled in the past two years – or stand to do so in the near future.
So if you avoided these stocks over the last two years, you gave up some truly gains.
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About the Author
Michael A. Robinson is one of the top financial analysts working today. His book "Overdrawn: The Bailout of American Savings" was a prescient look at the anatomy of the nation's S&L crisis, long before the word "bailout" became part of our daily lexicon. He's a Pulitzer Prize-nominated writer and reporter, lauded by the Columbia Journalism Review for his aggressive style. His 30-year track record as a leading tech analyst has garnered him rave reviews, too. Today he is the editor of the monthly tech investing newsletter Nova-X Report as well as Radical Technology Profits, where he covers truly radical technologies – ones that have the power to sweep across the globe and change the very fabric of our lives – and profit opportunities they give rise to. He also explores "what's next" in the tech investing world at Strategic Tech Investor.