I would be buying a stock that plummeted due to recent headline concerns regarding its Cybercab launch. I am betting Tesla is more than just a car company with exponential growth ahead.
But Chase the Winner is often the brutal reality of how wealth is generated: by backing the champions even when the stock price makes me wince.
$Apple(AAPL)$ is the poster child of Chase the Winner. Even as critics claim it is too big to keep growing or expensive at P/E ratio of 38, Apple continues its upward momentum, near its 52 week highs.
So I prefer to Chase the Winner as I am betting on innovation & excellence.
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