Psychologically, high-priced stocks can indeed feel intimidating. Here's a closer look at each question:
1. High-Priced Stocks' Influence: High nominal prices can subconsciously steer investors away, even when the percentage risk is equivalent. Many prefer "affordable" stocks, associating them with lower risk.
2. Avoidance of Netflix or Berkshire Hathaway: Some investors avoid these stocks due to their high prices, even if fractional shares or ETFs offer exposure. This often stems from mental biases rather than rational evaluation.
3. Belief in Value vs Price: A high stock price doesn’t necessarily indicate overvaluation. While it’s easy to acknowledge this logically, fear of loss can override rational thinking, especially in volatile markets.
4. $5,000 Allocation: Allocation depends on strategy. For a mix of growth and diversification:
$2,000 in Nvidia: Strong growth potential in AI/tech.
$2,500 in Netflix: Long-term streaming dominance.
$500 in SOXL: High-risk, high-reward exposure to leveraged ETFs.
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- snuggix·04-21Your insights are spot onLikeReport
- MichaelPerez·04-21Great insightsLikeReport