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The hottest stocks are quietly getting killed off

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By Michael O’Connor

Markets are constantly changing and adapting, but a timeless law is that money will always chase performance, leaving us a step behind.

Over the last six months, four stocks - Microsoft, Apple, Nvidia and Google - have generated almost 70% of the S&P 500's return.

Meanwhile, many of the retail investing favourites continue their precipitous decline.

In what has now been dubbed the Tarantino Market, the hottest stocks from last year are quietly getting killed in the basement while everything continues as normal in the front room.

Docusign, Square, and Twilio have all lost between 20% and 35% YTD
Teledoc, Zoom, Beyond Meat and Zillow have lost roughly 50% YTD
StoneCo, Pelaton and Lemonade are down between 65% and 80% YTD

The S&P 500 Index is up almost 25% this year, relentlessly hitting all-time highs in December while growth names crumble in the background.

A reminder that stock picking is hard, and nothing lasts forever.

Statistically impossible

For tech growth stocks that had produced record growth numbers in recent times, the endless upward trajectory was unsustainable, and those who assumed a perpetual state of hyper-growth are now beginning to sober up. It's a lesson learned.

It's easy to get drawn in by the enticing narrative that these mammoth growth rates create, but these growth rates will never persist; it's a statistical impossibility. 100% revenue growth is an impressive but manageable task if your total revenue is 100k. Doubling your revenue from $500 million to $1 billion is a much more arduous endeavour.

Don't get too attached to the hyper-growth story. The rate of growth is guaranteed to slow down over time, and much of this future growth is already baked into the price.

Ensure you have other areas of conviction that you can assign to the company. Every company can have a hyper-growth story at some time or another. You need to have enough conviction to stay the course as the narrative changes and companies encounter inevitable growing pains.

You will never expose yourself to the exponential returns these companies offer in the long run if your only metric is price. Focus on finding companies you believe in with strong moats, inspirational founders, and innovative IP - companies that correspond with your vision of the future. Focusing on understanding what you're invested in and why you are invested in it makes it a lot easier to ignore the guaranteed price fluctuations over time.

With that said, markets, companies and people change, so make sure to objectively assess your positions at regular intervals to ensure your original investment thesis still applies.

Momentum is a powerful force in today's market and making investments simply because a stock has gone up in price and you are looking to get in on the action can be a rewarding strategy in the short run.

Still, without understanding what you own and why you own it, you are in for a painstaking investment experience laced with perpetual uncertainty.

Make a plan

The recent losses across the popular retail investor names has highlighted the need to stay focused on the core principles of long-term investing.

· Don't get caught up on short-term moves. Focus on your long-term time horizon
· Make sure you have adequate diversification
· Be patient: There will be periods where markets fall over 10%, that is a guarantee
· Stay committed to the companies you believe in; conviction is everything
· Be an opportunist: Use market corrections to build out positions in your favourite stocks.

As always, you can find more investing information at theislandinvestor.com.

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Applecroft B&B named in Ireland’s Top 10

By Michelle Crean What a better way for a local business to celebrate its silver jubilee than to be named in the Top 10 places to stay in Ireland especially as they prepare to reopen after the pandemic. Owners Kathy and Don Brosnan, who run Applecroft House in Woodlawn, were named number 6 in Ireland’s […]

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By Michelle Crean

What a better way for a local business to celebrate its silver jubilee than to be named in the Top 10 places to stay in Ireland especially as they prepare to reopen after the pandemic.

Owners Kathy and Don Brosnan, who run Applecroft House in Woodlawn, were named number 6 in Ireland’s Top 10 B&Bs for 2022 by the Irish Independent ‘Reader Travel Awards’ while Ireland’s Best B&B was named as Dingle’s Pax House.

The couple began their business in 1997 and are very happy with the feedback from visitors who voted for their B&B, especially after two difficult years.

“I’m thrilled, especially as we’re celebrating our silver jubilee this year,” Kathy told the Killarney Advertiser.

The couple built their house in the early ’80s and aptly named it ‘Applecroft’ as it was built in a field which has an orchard.

In the late ’90s they opened five spacious rooms up, each with its own theme; 
‘Poet’s Corner’, ‘Past Times’, ‘The 19th Green’, ‘The Race-goer’s Club’ and ‘The Kerry Way’, for guests as Kathy, who worked in The Europe Hotel and the Great Southern Killarney for many years, had a passion to bring a great stay experience to guests visiting Killarney. They kept themselves busy planting in their two acre garden during the pandemic.

They have won numerous awards over the years and have had film crews in but this latest award is the icing on the cake for the couple who are looking forward to reopening in late March.

“It’s amazing, and a bonus especially with the two years we’ve had. We’ve never experienced anything like that. It was “wow” – we were preparing to reopen on St Patrick’s Day that year and all of a sudden everything closed down on the 16. It was a big shock.”

Don creates amazing bread and scones which guests rave about, she added.

“I was delighted as we came tenth for breakfast and sixth for the B&B.”

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Tributes paid to life-long Legion supporter

By Sean Moriarty Legion GAA Club has led tributes to one of their most ‘fervent’ supporters who passed away on Tuesday. Described as one of the town’s ‘old stock’, Tim Looney from Coolgraine Park and late of Daltons Avenue, was a central part of Killarney’s rich sporting heritage. As well as a life-long supporter of […]

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By Sean Moriarty

Legion GAA Club has led tributes to one of their most ‘fervent’ supporters who passed away on Tuesday.

Described as one of the town’s ‘old stock’, Tim Looney from Coolgraine Park and late of Daltons Avenue, was a central part of Killarney’s rich sporting heritage.

As well as a life-long supporter of Legion, he played basketball in the famous town leagues of the 1970s and the seven-a-side soccer ‘Wipeouts’ competitions.

“He was a very proud Legion man and always flew the green and white flag out his window whenever the club was playing in a big game,” PRO Enda Walshe told the Killarney Advertiser. “He was a fervent loyal club supporter but was also one of the characters of the winter basketball leagues.”

Tim was also a regular participant in Dart Pub Leagues back in the 1970s and 1980s.

Tim’s funeral took place today (Friday). He was laid to rest at Killarney Burial Ground after 10am Mass St Mary’s Cathedral.

Tim is survived by his wife Nuala, his children Joanne, Paudie and Timmy, and was a much loved grandfather to Stephen, Makaela, Chloe, Padraic, Keelan, Alex and the late Lorna. He will also be sadly missed by his daughters-in-law Margaret and Sharon, son-in-law Tony, sisters Kathleen, Sheila and Ann, brothers Lewis-John and Paddy, brothers-in-law, sisters-in-law, nieces and nephews, grand-nieces and grand-nephews, relatives, neighbours and many great friends.

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