Investing Lessons From the Luckin Coffee Accounting Fraud Debacle [The Motley Fool]
Luckin Coffee Inc. (LK)
Last luckin coffee inc. earnings: 11/13 06:00 am
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Source: The Motley Fool
For investors who had bought into the growth story ofLuckin Coffee(NASDAQ:LKplummeted nearly 80%That is bad news for anyone who held Luckin stock prior to the drop. But are there a few valuable (yet expensive) lessons that could be drawn from Luckin's collapse?You might think that there isn't much to be learned here. After all, how can you judge any stock if its numbers have been manipulated? Still, I think there are several important takeaways from the Luckin debacle that can be used to better manage risk on similar future investments. Here are four of them.Image source: Getty Images.. Stay diversifiedThe first main lesson to understand is that, unless you have very intimate knowledge of a proven company with a long history of great results, it's best to stay diversified. That's especially true when investing in expensiveWhile seasoned active investors may use concentration in a few stocks as a strategy to produce outsize returns, average retail investors should probably diversify th
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