posted on 06-06-2019

Tenbagger

Updated October 1, 2019

What is a Tenbagger?

A tenbagger is a stock that increases by a factor of ten.

How Does a Tenbagger Work?

Let's say Company XYZ is trading at $5 a share. John Doe buys 100 shares, costing $500. Six months later, the company announces it has found the cure for cancer. The stock rises to $50 a share -- a tenfold increase. John has a tenbagger on his hands.

Investor Peter Lynch coined the term in his book "One up on Wall Street: How to Use What You Already Know to Make Money in the Market."

Why Does a Tenbagger Matter?

Everybody wants a tenbagger, but so few of us ever get one. Typically, they are companies that invent or sell "the next big thing" and that only happens once in a blue moon.