Investing Feeds

Three months ago Google shares reached a record high of $741.79. I personally berated myself for my failure to buy up some shares back when cost per share was around $300. I promised myself that I’d watch the stock more closely and grab up a few shares the moment cost per share dropped below $500.

Last week has been called one of the stock market’s most volatile weeks in memory. That week saw Google shares close around the $570 mark. At this specific moment a share of Google stock is $566.40, but the market has yet to open for the day.

The question on my mind is, would it be a smart risk to buy up a few shares of Google stock should the cost per share drop below $500, in anticipation of it climbing again and possibly reaching the four-digit per share price that Wall street analysts at one point predicted?

Darren Chervitz, Director of research at the Jacob Internet Fund, is quoted by John Letzing for MarketWatch as saying, “As long as you have faith the economy will get back on track, you don’t get too nervous about Google. I can’t see anything to suggest they’re not continuing to take mind share and market share, which will put them in great shape when the economy rebounds.” But how much stock can you put in the word of a company which counts Google among its top holdings? They clearly can’t afford to imagine the worse for Google.

But this is Google, and I remind myself of the opportunity I lost several years back when shares of the stock were selling for $85 and I debated whether to go ahead and invest but took too long to make my decision. I also remind myself of the opportunity I lost again back when I was debating if I should go ahead and pick up a few shares at $300 a piece. Am I going to allow myself to miss another opportunity?

All of this of course depends on the stock price continuing to decline and reaching under $500, which would certainly be an alarming low for Google. Or perhaps it would be smarter to grab up those few shares right now rather than waiting for it to drop that low. The market is expected to rebound soon enough after all and it’s entirely possible the stock price will be back in the $700 range before long. And with Google aggressively trying to get into everything and boot out everybody, it’s entirely possibly their stock could reach a four-digit per share price this year.

Then again, the way Google is aggressively trying to get into everything and boot out everybody they’re a target for enough people who would love to see them take a dramatic fall from grace. Some people think Google has become a great big bully trying to use brute force tactics to intimidate and control everybody from the little guy in the boon docks just trying to make a few bucks with his website to big companies that try to rival Google. People don’t like bullies, and when enough people unite to take a bully down the bully usually retreats and commits suicide.

Is Google indeed God like some people have concluded? Because if Google is God then no army can bring the company down with any kind of ammunition. In that case one would have to be a fool to think Google is on its way down, and thinking this foolish thought, pass up the opportunity to grab some shares of Google stock while the price is down by $175 from the all-time high. However, if Google isn’t God it’s possible Google will not continue to dominate.

It’s arguable Google has already reached its zenith. If that’s the case Google can only stagnate or fall. Meanwhile Google’s rivals are still climbing and someone will overtake the mighty giant at some point.

But for the sake of determining whether or not to grab those shares of stock while they’re somewhat affordable, Google’s fall might not happen for a few years and their stock might yet reach the 4-digit per share range before they fall. Still, at $500 per share you’d only double your investment were you to pick up say 40 shares at 20K then sell all once the share price reached 1K. That’s not too impressive. More impressive would be if the stock price falls to say 100 and you pick up 200 shares then sell all once the share price reached 1k. But when Google stock falls to $100 per share that’s when you know the company is free-falling back to earth and you’d better move out of the way or get flattened.

The conclusion, unless you have big money to invest and you can afford losing the big money you invest, or unless you’re day-trading or otherwise looking to accumulate money from investing through some other short-term buy-sell format, it might not be wise to invest in Google at this point. If you can only afford to invest $5000 for example, the most you can do with that at this present moment is 8.827 shares of Google stock. Even if the stock grows to $1000 per share and you sell at that point you’re looking at under $4000 in profit from sales; and that’s a big “if the stock grows to $1000″. There are probably smarter ways to invest $5000 at this point than buying 8.827 shares of Google stock.