2nd Post
This is going to be a longer than normal post, because I want to start telling a story of my recent history. I had been looking for an outlet to actually start writing something about the business endeavour I started in January of this year (2006) for my birthday, and this blog I recently started provides me with that opportunity.
It all started as I was walking around the Barnes and Noble near the Towsontown Mall, looking for something I might enjoy reading when my eyes' attention was caught by this little blue book. So, since I had been pondering for a while what it would take for me to get to know something about the stock market, and how it works, at the beginning of my 30th year this book provided me with an excuse to start looking into it. Also, I don't seem to be the only person who has had this type of experience.
I decided to give it a shot. In conjunction with the website advertised in the book, I opened a Scottrade account, after advise by the book and by the only investor friend I have, and who has been investing for quite some time (I actually don't how long ago he started). His name is Jon and he's one of Manu's (my fiancee) labmates. His guru is Jim Cramer, so after he found out that I wanted to start investing he told me about Scottrade (and the 3 free trades) and gave me Cramer's "Sane investing in an insane world" for my birthday*.
So I started: put $2500 on the account and bought 4 stocks advised on the website: Vaalco Energy (EGY, 120@5.25), Magellan Health (MGLN, 20@33.02), Innovative Solutions and Support (ISSC 45@13.91) and Marvel Entertainment (MVL, 33@16.40).
I didn't tell too many people about this for a few, pretty obvious, reasons. The first one is that I was buying stocks recommended on a website called magicformulainvesting.com, which unquestionably sounds like the lamest scam site I can think of. A second reason is that I thought the best thing to do was to see how well I was doing, then perhaps gain some confidence, and start telling other people about this endeavour.
The first 3 stocks I mentioned I had never even heard of (then again, almost all the stocks on the website had the same property) but they were highly ranked on the website, so I gave them a shot. The 4th one was further down the list, but it was the only company I recognized, having seen most of the Marvel-based superhero movies around (Spidermans, X-mens).
With 3 of these companies (egy, mgln, issc) I was off to a good start, actually making money, up $300 after 10 days (12%). In fact, as of today, with egy and mgln I haven't had a single day in which I was losing money on them.
This has a (positive) side and a negative side: the (positive) side I put in parentheses because it's positive only if in the end I really do end up making money which, so far, has been happening. The (positive) side, of course is the fact that it's easier to continue investing if things go well, not so much if they don't. The negative side, is that it doesn't prepare you for how to handle - how should we call them? - adverse situations, of which I will speak in a later post.
I put this post up to let you know about my experience with the stock market, and perhaps to get some feedback from those of you who have had a similar experience investing with the blue book, and anything else you may want to let me know about.
In case you're curious, I'm currently up 20% (as of 7/28) and have had a fair share of swings (but haven't touched negative total money yet!)
Let's hope the streak continues!
* A little addendum: from that book, I took out 2 pearls of wisdom: one is that it makes sense to invest in the market MAINLY when you're young, because the older you get, the less you can risk losing what you have (unless your pension/retirement plan is unlike what I think mine will be). So he describes this nice graded scale of what percentage of risks you should be on the stock market (as opposed to indexes, savings accounts) the older you get.
The second main thing I liked was the cyclical graph he has (the only non-text-filled page in the book, I think) in which depending on where the Fed's interest rates currently are, he tells you what to buy and what to sell... or at least sort of does
It all started as I was walking around the Barnes and Noble near the Towsontown Mall, looking for something I might enjoy reading when my eyes' attention was caught by this little blue book. So, since I had been pondering for a while what it would take for me to get to know something about the stock market, and how it works, at the beginning of my 30th year this book provided me with an excuse to start looking into it. Also, I don't seem to be the only person who has had this type of experience.
I decided to give it a shot. In conjunction with the website advertised in the book, I opened a Scottrade account, after advise by the book and by the only investor friend I have, and who has been investing for quite some time (I actually don't how long ago he started). His name is Jon and he's one of Manu's (my fiancee) labmates. His guru is Jim Cramer, so after he found out that I wanted to start investing he told me about Scottrade (and the 3 free trades) and gave me Cramer's "Sane investing in an insane world" for my birthday*.
So I started: put $2500 on the account and bought 4 stocks advised on the website: Vaalco Energy (EGY, 120@5.25), Magellan Health (MGLN, 20@33.02), Innovative Solutions and Support (ISSC 45@13.91) and Marvel Entertainment (MVL, 33@16.40).
I didn't tell too many people about this for a few, pretty obvious, reasons. The first one is that I was buying stocks recommended on a website called magicformulainvesting.com, which unquestionably sounds like the lamest scam site I can think of. A second reason is that I thought the best thing to do was to see how well I was doing, then perhaps gain some confidence, and start telling other people about this endeavour.
The first 3 stocks I mentioned I had never even heard of (then again, almost all the stocks on the website had the same property) but they were highly ranked on the website, so I gave them a shot. The 4th one was further down the list, but it was the only company I recognized, having seen most of the Marvel-based superhero movies around (Spidermans, X-mens).
With 3 of these companies (egy, mgln, issc) I was off to a good start, actually making money, up $300 after 10 days (12%). In fact, as of today, with egy and mgln I haven't had a single day in which I was losing money on them.
This has a (positive) side and a negative side: the (positive) side I put in parentheses because it's positive only if in the end I really do end up making money which, so far, has been happening. The (positive) side, of course is the fact that it's easier to continue investing if things go well, not so much if they don't. The negative side, is that it doesn't prepare you for how to handle - how should we call them? - adverse situations, of which I will speak in a later post.
I put this post up to let you know about my experience with the stock market, and perhaps to get some feedback from those of you who have had a similar experience investing with the blue book, and anything else you may want to let me know about.
In case you're curious, I'm currently up 20% (as of 7/28) and have had a fair share of swings (but haven't touched negative total money yet!)
Let's hope the streak continues!
* A little addendum: from that book, I took out 2 pearls of wisdom: one is that it makes sense to invest in the market MAINLY when you're young, because the older you get, the less you can risk losing what you have (unless your pension/retirement plan is unlike what I think mine will be). So he describes this nice graded scale of what percentage of risks you should be on the stock market (as opposed to indexes, savings accounts) the older you get.
The second main thing I liked was the cyclical graph he has (the only non-text-filled page in the book, I think) in which depending on where the Fed's interest rates currently are, he tells you what to buy and what to sell... or at least sort of does
posted by Fra... at 11:42
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