RetireJapan

Hi Everyone,

Hope you are all having a good Golden Week.

I am a novice investor, and I have been reading up on investing and get the weekly newsletter from RetireJapan, etc. I have some mutual funds and do NISA.

Long story, but recently I closed an investment account (where the ending value was much much higher than when I started it a long time ago. It is now sitting in a bank account, but I want to make that money "grow". ). I am thinking about reinvesting the money from it in other funds (mostly index funds). However, I was wondering if it was also worth also buying one share of amazon stock. Looks like the price was $1938 .43 (April 29) yesterday.

Do you guys think that the stock is reasonably valued?

If I buy it, I wouldn't cash it right away... I envision keeping it for many years.

Thanks for any feedback.

I have no idea. Price/earnings is 80! But their earnings may be artificially low as they reinvest a lot back into new businesses. Will they continue growing? Will they be broken up by governments? Will a competitor come along and wipe them out?

If you buy an index you will also own a piece of Amazon. Buying more of it is a bet that they will outperform.

If you want to give it a shot and can afford it (and are investing into sensible things with most of your portfolio) I wouldn't tell you not to.

But I'm the guy that bought Bitcoin pretty much at the peak and lost a not inconsiderable amount of money

If you have access to the US market, I'd suggest a growth ETF. Something like VOOG, SPYG, IWY, or MGK will have it in their top ten holdings, and I'd guess 5-8% of any of those would be invested in amazon.

If you're US and investing here, and trying to buy individual names/stocks to avoid buying funds (due to PFIC reporting), one strategy might be to look at the top 10-20 holdings of those ETFs (etfdb.com) and work towards a similar list (probably over several years).

(Bottom line is that I'm suggesting diversification, one way or another.)

I'm one of those guys trying to get rich slowly quickly, such that 75% of my allocation is in tech stocks. Some people like FAANG, I personally prefer MAGA (Microsoft, Apple, Google, Amazon). I can't tell if you it's reasonably valued or if it's a good buy now. I just want you to know that tech stocks sometimes get rather temperamental and you really have to be honest with yourself when this happens.

About 20 years ago a French expat who worked under me in Japan left to go work at Amazon’s HQ. Of course I see now that I should have invested then but AMZN is a really difficult stock to evaluate because their earnings are voluntary and only taken when it suits their tax strategy. I eventually bought a few shares with a basis around $400 but I suspect I could still lose money on that if any of the risks mentioned above came calling. I have no idea how to value this stock. Like others here I recommend basing your portfolio on index funds and only put money in a stock like this if you can afford to lose it.

Thanks for your advice! You guys were all very helpful!!!