If you had the chance 5 years ago to invest in either Apple or Crocs, which would you invest in? Now you may be thinking “Apple of course, I barely even hear about those weird plastic shoes anymore!” but the problem is that 99% of Americans are thinking just like you. Why is this a problem? Well, what if I told you sometimes you miss the opportunity right under your nose if you stay too focused on what’s ahead of you on TV, YouTube, or any other entertainment platform? The point I’m making is to check around the room and really evaluate your opportunity options before fixating on one just because it’s the popular option or just because it’s right in front of you.
Sure, it sounds nice but there’s no way Crocs outperformed Steve Jobs’ Apple.. Right?! The answer is yes, they did. And not just slightly either, by nearly double! The most insane part about this is that Apple is not alone among the losers either. Crocs, the company everyone loves to crack a joke at also outperformed Amazon, Netflix, PayPal, and Microsoft by a similar margin. If you would have invested $1000 in Crocs in 2016, you’d be sitting on $10,260 today whereas if you would have invested that same amount in Amazon (the global e-commerce giant) you’d only be sitting on $5,033.
Why is this? Why are these much smaller companies offering much better investment opportunities than these giants? Well, the answer is actually quite simple. These giants are already, well… giant. Their growth potential is huge but because they are already so big it’s harder for them to double, triple, or even quadruple in value. However, for a smaller company like Crocs, if they catch the right wind, advertise the right way then they can literally increase in value tenfold. Plus, when big companies are in the news constantly the attention is always on them meaning the demand is high. This in turn makes the prices skyrocket in the stock market which makes it harder to make a nice sizable profit.
What’s the takeaway? What if $1000 fell in your lap today? Well, turn off the news and open your computer and start scouting for smaller companies that you think have potential. These are the diamonds in the rough, these are the ones that have potential to make your investments explode in value. When you invest in bigger companies it’s definitely the safer route, but if you can find a solid start-up that's being publicly traded and has great future potential it’s definitely wise to toss a few eggs in that basket.. And who knows? Maybe they’ll turn into golden eggs soon enough. So, slip on your crocs, grab a cup of coffee, and get to work.
This article is not suggesting you run out and buy crocs or crocs stock, but rather it meant to
help you think outside of the typical stocks the talking heads on TV tell you to buy every day.
Stay Amazing!
