22 months of DCA: From €26 IPO to €16.69 - Yesterday I bought at the bottom of a market crash
Started buying PUIG at €26.06 back in May 2024. Been averaging down consistently for almost 2 years now. Yesterday (March 3) during the IBEX crash, I added 350 shares at prices ranging from €14.76-€15.16 - literally €0.06 from the absolute bottom at €14.70. Today it rallied +3%.
**Current position:**
- 2000 shares @ €16.69 average
- ~€33,380 invested over 22 months
- Current price: €15.34 (after today's rally)
- P/L: -8.1% (-€2,700)
**The company:** PUIG - Spanish luxury/beauty group (Charlotte Tilbury, Paco Rabanne, Jean Paul Gaultier, Carolina Herrera)
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## Why PUIG? The Fundamental Thesis
Before I dive into the DCA story, let me explain why I've been willing to average down for nearly 2 years.
**The business model**
PUIG is a family-controlled Spanish luxury conglomerate with two main engines:
**Charlotte Tilbury** (the crown jewel) - Premium makeup/skincare brand growing fast, especially online and in Asia. Celebrity-backed with strong e-commerce presence. This brand alone could justify a significant portion of PUIG's valuation.
**Fragrance portfolio** (the cash cow) - Classic brands like Paco Rabanne "1 Million" and Jean Paul Gaultier "Le Male" generate high margins and predictable repeat purchases. Plus licensing deals with fashion houses provide stable revenue.
**The financial case**
Latest earnings showed **+7.8% Like-for-Like growth** - that's organic growth, not acquisitions. Real growth in a mature category. Margins are holding despite inflation, debt is manageable, and family control means long-term thinking over quarterly games.
Here's what caught my attention: at €14-16, PUIG trades at a **P/E of ~14x** while growing +7.8% LFL. Compare that to L'Oréal and Estée Lauder trading at 20-30x. Even at €20-22, PUIG would be fairly valued, not expensive.
The secular trends support this - premiumization (consumers trading up), Asian middle class growth, beauty resilience (the lipstick effect), and e-commerce shift favoring brands like Charlotte Tilbury.
**Risk factors I'm monitoring**
I'm not blind to the risks. If Charlotte Tilbury growth stalls, PUIG's growth story dies - I check every earnings report for this. A macro luxury slowdown (especially China) would hurt all brands. Margin compression from competition could force price cuts. And family control could turn negative - that €26 IPO was arguably overpriced.
So far? None of these have materialized. Thesis remains intact.
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## What Happened (March 3-4, 2026)
**Tuesday, March 3rd - The Crash**
IBEX-35 crashed -4.38%, one of the worst days of the year. PUIG fell harder at -5.41% due to small-cap beta amplification. Volume spiked to 919k versus the usual 620k average (+48%). The stock opened around €15.45 and progressively collapsed to €14.70 before closing at €14.84.
**My decision: 350 shares in 4 orders**
- 09:29 → 100 shares @ €15.16
- 09:48 → 48 shares @ €14.99
- 09:48 → 47 shares @ €14.99
- 11:20 → 155 shares @ €14.76 (€0.06 from the bottom!)
Average entry: ~€14.96
This brought me from 1650 → 2000 shares and lowered my average from ~€17.40 to €16.69.
**Wednesday, March 4th - The Reversal**
IBEX rallied +2.52%, PUIG outperformed at +2.95%. Volume: 900k - almost identical to yesterday's panic but in the opposite direction. Closed at €15.34.
The pattern I was looking for: high volume crash followed by similar high volume recovery = classic capitulation into institutional buying.
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## The 22-Month Journey: €26.06 → €16.69
**Phase 1: The Expensive Start (May-Sept 2024)**
Started at €26.06 - clearly overpriced in hindsight. Added at €21.54, €20.80, €19.60 as it fell. Learned the hard way that IPO pricing doesn't equal fair value. Should have waited 3-6 months for price discovery.
**Phase 2: The Grind Down (Oct 2024-Mar 2025)**
Continued buying in the €15-19 range with small adds (25-145 shares each time). Average slowly dropping but still deeply underwater. This period tested my discipline - being down -20-30% for months on end.
**Phase 3: The Deep Value Moment (Oct 2025)**
Price hit €13.59 - lowest I'd seen. Bought 50 shares. Started thinking this might be forming a bottom. At €13.59 with +7.8% earnings growth, it seemed too cheap to ignore.
**Phase 4: False Hope (Nov 2025-Feb 2026)**
Bounced to €15-18 range. Added on pullbacks, got my average down to ~€17.40. Thought maybe the worst was over. Narrator: it wasn't.
**Phase 5: March 2026 Capitulation**
IBEX -4.38%, PUIG -5.41%, hit €14.70. Added 350 shares aggressively - my largest single add in 22 months. Got my average to €16.69. Betting this was capitulation, not the start of another leg down.
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## Why I Kept Buying (Despite 22 Months of Pain)
**1. Fundamentals haven't changed**
LFL growth: still +7.8%
Charlotte Tilbury: still growing
Margins: holding up
Debt: manageable
Thesis: intact
The stock price fell but the company didn't break. Nothing structurally wrong with the business.
**2. The IPO timing mistake**
€26 was overpriced due to typical IPO dynamics. Market re-rated it to €13-17 fair value range. I'm correcting my entry timing, not chasing losses. My mistake was when I bought, not what I bought.
**3. Valuation improved dramatically**
€26 (IPO) = ~22x P/E with +7.8% growth → overvalued
€14-16 (now) = ~14x P/E with +7.8% growth → undervalued
At 14x P/E with that growth rate, PUIG is objectively cheap versus peers.
**4. Position building over perfect timing**
Not trying to catch THE bottom - just buying near bottoms consistently. 22 months of entries = true dollar cost averaging. Removes emotion: down day becomes a buying opportunity.
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## Why March 3rd Was Different
I had a rule: "Don't buy during geopolitical panic" (Iran war ongoing). But this day checked multiple boxes.
**The volume signal**
919k = +48% above average, highest since earnings. Extreme volume on extreme down days often signals capitulation. If followed by similar volume UP day → reversal pattern.
**Technical oversold**
Bollinger lower band at €14.80, price broke briefly to €14.70. RSI deeply oversold. MACD showing potential bullish curl.
**Valuation extreme**
At €14.76, P/E dropped to ~14x. With +7.8% LFL growth, that's a severe disconnect. L'Oréal trades 25x, Estée Lauder 20x+. PUIG at 14x felt too cheap.
**Market context**
IBEX -4.38% = top 5% worst days of the year. PUIG -5.41% = normal beta amplification for small caps. Maximum fear = maximum opportunity.
**Risk management**
350 shares = 21% position increase (largest add in 22 months). But I set a mental stop: if €14.50 breaks with volume, I sell 25-30%. 22 months doesn't mean I'm married to this position forever.
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## March 4th Confirmed the Pattern
The reversal validated what I was looking for:
**March 3 (Crash):** -5.41%, 919k volume, underperformed IBEX by -1.03%
**March 4 (Rally):** +2.95%, 900k volume, outperformed IBEX by +0.43%
High volume crash + similar high volume rally = classic capitulation → institutional accumulation.
€14.70 low held perfectly. No retest. Direct rally to €15.34.
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## 22 Months of DCA: Lessons Learned
**What's working:**
**Systematic averaging down** - €26.06 → €16.69 is a -36% reduction in cost basis. Without DCA, I'd still be stuck at €26 with a -43% loss. Now only -8.1% versus potentially -50%+ at worst points.
**Emotion removed** - DCA is mechanical, not emotional. Down day? Check fundamentals → buy if intact. Up day? Don't chase. Checklist-based entries only.
**Conviction enables patience** - 22 months underwater tests your resolve. But as long as fundamentals are unchanged, I keep executing. If thesis broke, I'd exit regardless of sunk cost.
**Small buys compound** - Started with 30 shares @ €26. Now 2000 @ €16.69. Never went all-in on a single day. Spreading risk works.
**What I learned the hard way:**
**IPO timing matters MORE than fundamentals** - €26 was 30-40% overvalued. Took 22 MONTHS to average down to reasonable levels. Hard lesson: wait 3-6 months minimum post-IPO.
**"Buy the dip" becomes "catch the knife"** - Bought dips at €22, €20, €18, €16... all fell further. DCA only works if fundamentals hold. Must re-evaluate thesis quarterly.
**Time has a cost** - 22 months of capital tied up = real opportunity cost versus other investments. Patience is necessary but expensive.
**Mr. Market stays irrational longer than expected** - Thought €18 was cheap (it was). Still went to €13.59 anyway. Fair value ≠ market price for months or years.
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## The Honest Math (22 Months Later)
**Current state:**
Invested: €33,380
Current value: €30,680
Unrealized loss: -€2,700 (-8.1%)
Cost basis improvement: €26.06 → €16.69 (-36%)
**Opportunity cost:**
If I'd bought IBEX index in May 2024: ~+15-20% estimated return → ~€38,000-40,000
Opportunity cost: ~€5,000-7,000
**Total cost of strategy:**
Unrealized loss: -€2,700
Opportunity cost: ~€5,000-7,000
Total: ~€7,700-9,700 below index
**But if PUIG recovers to fair value:**
€20 target: +€6,620 gain (+20%)
€22 target: +€10,620 gain (+32%)
Would outperform index entry by significant margin
This is the bet. 22 months in, still believing.
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## Current Plan Going Forward
**Exit strategy:**
**€16.69 (breakeven)** → Sell 30% (600 shares)
Lock in psychological win after 22 months. De-risk position. Let 70% run for upside.
**€17.50 (+4.9%)** → Sell another 20% (400 shares)
Take ~€2k profit. Partial victory after long grind. Keep 50% long-term.
**€14.50 (stop loss)** → Sell 25-30% if broken with volume
Preserve capital. Thesis invalidation signal. 22 months taught me: have exit discipline.
**Critical level:** €14.70 must hold. If it breaks convincingly, reversal thesis fails.
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## My DCA Rules (Refined Over 22 Months)
**1. Only DCA if fundamentals intact**
Re-check earnings, growth, margins every quarter. If thesis breaks → exit immediately. Sunk cost fallacy kills portfolios. Current status: fundamentals still solid.
**2. Size each add appropriately**
Typical: 25-100 shares per dip. March 3: 350 shares (21%) = aggressive but calculated. Never all-in on single day. Preserve dry powder for real crashes.
**3. Have a stop loss (and honor it)**
Mine: €14.50 breakdown with volume >800k. DCA ≠ "average down forever". Know when you're wrong. 22 months doesn't mean married to position.
**4. Track your basis obsessively**
€26.06 → €16.69 = measurable progress. Celebrating basis reduction keeps morale up when underwater. Always know exact breakeven.
**5. Set take-profit levels in advance**
Emotion-free selling is harder than buying. 30% @ breakeven is non-negotiable. Don't get greedy after 22-month grind.
**6. Re-evaluate thesis quarterly**
Every earnings = decision point. Ask: "Would I buy this TODAY at current price?" If no → exit regardless of history. If yes → hold or add.
**7. Accept opportunity cost**
Index might outperform. Single names are riskier. But potential upside is why we do this. Just be honest about tradeoff.
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## Questions for Discussion
**Time horizon:** Is 22 months of DCA discipline or stubbornness? When would you have cut losses?
**IPO strategy:** Do you avoid IPOs entirely? Wait 3-6 months? Jump in if thesis is strong?
**Fundamental conviction:** What would make you stop DCA'ing? Revenue decline? Margin compression? Management change?
**Opportunity cost:** How do you weigh single-name conviction versus index safety over multi-year periods?
**Volume patterns:** Is 919k→900k reversal pattern reliable? Or pattern recognition bias?
**Exit discipline:** After averaging down 22 months, how do you avoid the "just a bit more" trap?
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## Track Record (Will Update)
**May 2024** - First buy: 30 shares @ €26.06
**May 2024-Feb 2026** - ~20 additional buys in €13.59-21.54 range
**March 2, 2026** - Pre-crash: 1650 shares @ ~€17.40 avg, ~-13% loss
**March 3, 2026** - Crash day: +350 shares @ €14.96 avg → 2000 total @ €16.69 avg, -11%
**March 4, 2026** - Rally day: Hold → 2000 shares @ €16.69 avg, **-8.1%**
Will update when I hit:
- €16.69 (sell 30% - victory lap after 22 months)
- €14.50 (stop loss - admit defeat)
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## Disclaimer
Not financial advice. Large position: 2000 shares @ €16.69 (-8.1%). This is a 22-month case study in DCA through IPO disappointment. I could be completely wrong - €14.70 might not hold. This took nearly 2 years and -€2,700 to get here. Opportunity cost versus index is real (~€7k-9k below). Do your own research.
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## Final Thoughts: 22 Months in Perspective
**On conviction:** Easy to believe when up. Hard to believe when down 22 months. True conviction = buying when price disagrees with you.
**On process:** DCA removes emotion but requires discipline. €26→€16.69 didn't happen by accident. Systematic beats emotional.
**On patience:** 22 months feels like forever. But if thesis is right, it's a blip. If wrong, should have cut sooner.
**On humility:** IPO price ≠ fair value. Mr. Market can stay irrational for YEARS. Opportunity cost is real.
**The question after 22 months:**
Am I disciplined or stubborn?
Is €14.70 the bottom or another pit stop?
Will fair value eventually matter?
I'll know in the next few months.
If €14.70 holds and PUIG recovers to €20+, this will be one of my best trades.
If it breaks to €12, I wasted 22 months and should have bought the index.
Either way: I'll update this thread with what happens.
Transparency > perfection.
Process > outcome.
22 months down, ??? to go.
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*If you've DCA'd a position for 1+ years, I'd love to hear your story - especially if you recovered (or didn't). Learning from others' multi-year journeys is invaluable.*
*Update coming soon: Will €14.70 hold for day 3?*