You’d have made a hell of a lot of money.
Sony announced their next console, the Playstation 4 today. They didn’t unveil the actual machine or give its cost. But, it got the internet buzzing with hype, argument, and discussion.
But, unlike every other time a next generation console has been announced the news left me unphased. On twitter I attributed this to growing up. Some people took offense to that. I didn’t mean it in the sense that video games are for kids but more that I’m growing out of them perhaps.
After being told about the announcement and reading some articles I still couldn’t care much about it. Instead I found myself thinking about what I could have done with the money I earned instead of buying a new console. Or what I could have done with the money I have used to buy consoles in the past.
And so a thought experiment was born! The Playstation 3 came out on November 11, 2006 in two version. A 20 gig rig that retailed for $499 and a 60 gig version that sold for $599. On that same date a single share of Apple’s stock was selling for $83.12.
With the money you would have spent on the 20 gig version you could have bought six shares of Apple stock (we’ll round down and say 7 stocks if you sprang for the 60 gig version.) Seven years go by. Today, I can go on ebay and buy a 20 gig original PS3 for between $40-$70. Sixty gig versions go for around $100. A deprecation in value of 84 to 92 percent?!
As of the writing of this posts Apple’s stock was selling for $448.85 per share. So, your six apple stocks would be worth $2693.10 for an increase in value of 540 percent! Quite the deal!
Of course in 2006 I wasn’t married or working full time or contemplating buying a house. Still, if I had bought the stocks then I could have made money and bought a PS3 now and still come out ahead. Just think about that this fall when you rush out to buy the new one…
*this is all of the cuff maths so if I made a mistake I apologize. Regardless, the stock purchase would have done you a lot better than the PS3 one.
And if I had bought Apple stock and gone to hop around youth hostels in Europe, instead of buying a biggish house in the provinces, I”D be money ahead.