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My Investment Beginnings…

November 14, 2012

Investing is a whole new frontier to me.  I am self taught up to this point and am bound to make mistakes that could cost me thousands of dollars.  But I’m not scared and you shouldn’t be either.

Some Most people say investing while having debt is a horrible idea.  Well I happen to think the exact opposite.  If you do your homework and don’t get emotional, why not make some extra money to help pay off that debt faster?  Yes I understand that to make this work, you have to beat the market while beating the interest that’s accruing on your debt, really I get it.  If it was easy, everyone would do it.

How I Got Started

The stock market has always interested me.  Starting at a young age I would always find myself looking at the previous days numbers in my dad’s old newspaper and wondered how it all worked.  It seemed fascinating and although it was the “big bad scary stock market”, people still made money from it, right?  I’ve always been driven by money and now that I’m older, I’ve made the decision to learn.  Tim Ferris says to go read and study 3 books on any given topic and you’ll know more than any average person and you can then deem yourself an expert and be a consultant.  While I don’t completely agree with this, it has a ring of truth to it.  I took this advice and that’s where I started.  I read “I Will Teach You To Be Rich” and other books like it to get my personal finance skills up, and then went and bought “Stay Mad For Life” by Jim Cramer and “The Intelligent Investor” by Benjamin Graham.  Now we all know who Jim Cramer is, the bald guy on TV yelling at you to BUY-BUY-BUY!! or how stupid you are for falling in a Wall Street trap of some sort.  But his writing style is purely helpful without the big headed-ness of his TV show.  Benjamin Graham on the other hand was the teacher and mentor of the world’s greatest investor, Warren Buffet.  Although the book was written in the 1930’s, Buffet claims that it is the best book on investing to this day.

The Test Run

I joined (for free) a stock market simulator website called Wall Street Survivor to test the waters.  I started with $100,000 virtual cash and set out to turn into the next Warren Buffet.  Within a week I realized it was easier to lose/waste money trying to “day trade” than it was trying to start a fire with dollar bills in a drought.  But what I took from the experience was the little things like, for every trade you pay a commission fee (usually around $10.)  I learned that holding a stock for over a week isn’t considered “long term.”  And I learned that buying low and selling high isn’t as easy as it sounds.  After running this simulator and getting all my bad luck and kinks out of my system, I struck out and made my first move.

The Solo Flight

I did it.  I became a grown up and bought some stock.  But how could I mess up on the first one??  Yeah I made an impulse buy that stems back to the trial day trading and I messed up.  I bought stock in a dry shipping container company based out of GREECE!!!! Yeah…talk about NOT doing your homework. (UPDATE: It isn’t doing too bad but I still watch it daily!)  I spent a total of $62.83 including the trading fee and began the intense wide eyed watch of the market for the rest of that day clicking the refresh button about 40 times a minute to watch for changes.  Yeah…I know…

And The Light Bulb Goes Off

“Stocks are an investment like real estate is.  Do you check the value of your real estate every 40 minutes?  At the end of every day? No, so stop doing the same thing with your stocks.”

I wish I could remember where I read it, but this quote brought things into perspective and kept me from the ledge that so many professional stockbrokers face in the Big Apple.  It just clicked after I read that.  There was absolutely no need in stressing myself out about the tiny percentages.  I can’t not look in on them at the closing bell every day BUT I am a student of Benjamin Graham and I am an investor, NOT a speculator.  With this in mind, I was beset with relative peace of mind (to whatever extent that can be when dealing with the stock market, haha.)

Present Day

It’s been 3 months now since I made that first trade (only making 3 more trades in my investment portfolio since then due to financial constraints) but I am proud to say that I am in the GREEN!  For being self taught and learning through trial and error, I am extremely pleased with my accomplishments.  Refer to the Investing page to see updated numbers.

Feel free to comment or criticize and follow me on Twitter at @MyFinancialRoad

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From → Investing

One Comment
  1. Hey there,
    Would you mind sharing which blog platform you’re working with? I’m looking to start my own blog
    soon but I’m having a difficult time deciding between BlogEngine/Wordpress/B2evolution and Drupal. The reason I ask is because your design seems different then most blogs and I’m looking
    for something completely unique.
    P.S. Sorry for getting off-topic but I had to ask!

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