Returning to the abyss of 2020, Rolls-Royce Holdings (LSE:RR.) Shares fell below 40p.

The company was under increasing pressure from potentially crippling debt levels. And fears that Britain’s most respected aerospace name could go bust were real.

Even two years later, in slow 2022, the short-lived bounce had faded and shares were down around 70p.

If someone had told me then that by August 2024 the Rolls-Royce share price would see one of the best gains I have ever seen and break through 500p, I would have laughed.

Egg face

Well, I would try not to be rude and laugh in your face. But I would chuckle and quietly shake my head to myself.

But it would be my face that had egg on it today. And you, dear imaginary reader, would be the one laughing.

But I won’t just mutter to myself and dwell on how right I could have been about other actions. No, I think we can learn from the ones we’ve made, and not hide from them.

But first, let’s consider how much profit I could have actually made if I had bought stocks during the gloomy times?

Big profit

Well, that 40p share price I was talking about was almost four years ago. And in August, at the 52-week high of this year, we saw Rolls hit 505p.

If I had invested £5,000 in Rolls-Royce shares at that time, I could have made a tidy sum of £63,125. I may take comfort in the fact that I did not have that much to invest at that time.

But even £500 today could be worth £6,300 plus change.

Hmm, this could be a lesson. Sometimes, stocks in a crisis can seem too risky to invest in as a earnest investment.

But if I see at least a 50% chance of recovery, maybe a petite amount is still worth the risk? I suppose my younger self might have risked the £500.

Second bite

And then, when the shares were trading at 70p at the end of 2022, the risk had diminished somewhat. That same £5,000 could have grown to £36,000 today. And that would still be a very gigantic gain, in just half the time.

There is a flip side to all of this, though. And I think we should never forget that as we spend time kicking ourselves for missed opportunities.

No one has ever lost money by not buying stocks.

Has any famed investor ever said that? Maybe one day I’ll be famed and then I’ll say it.

Stupid approach

So what’s the point of all this? My somewhat carefree perspective on how I missed out on some major multi-bagger action?

Well, the only thing we really can’t employ to check the quality of our past decisions is past knowledge. We can’t judge based on knowledge we didn’t have at the time.

We simply have to make enough good decisions throughout our lives. And a key part of that is following an vital rule: Never lose money. And yes, a famed investor once said that.