Agree that you have to learn the basics of investing, my example was to show how much you can earn if you invest in the right stocks.
This is me, I do buy Individual stocks (again to hold them for long term eg Apple) but most of my portfolio are ETFs and mutual funds.
How to identify which stocks to buy? As I mentioned previously in this thread you need to do your research. Follow the market trends, watch the news regularly, keep your eyes and ear open, join with group of people around you who are into this. For example, suppose think when this pandemic started what happened? What all industries got affected? My category 1 stocks. I will list losses first. These are my watch and buy & buy and accumulate. These affected initially and started to recover end of last year. I got more time to buy these. This is how we did. The international border closed and Lockdown started and people stayed home. When no one going out, not traveling out, airlines, automobile & cruise affected. Airline and cruise are the bigger oil consumer. Because of no oil consumption so it went down. Other business corporations that supply parts and materials to these oil, airline, auto industry their stocks went down. Due to job losses & people are not going out because of this Lyft, hertz, movie theatres, theme parks, hotel industry, retail industry, electronics industry got hit. So now we got industries next step is to list all the companies which you can think of for example Airline - delta, American, united, Boeing Oil - Exxon, chevron, Marathon Theme park/amusement- Disney, six flags, sea world Entertainment - amc, cinemark, mgm Hotel- Hyatt, Marriott, Hilton Auto - Ford, General Motors Then Next step is to remove the companies which are going to file bankruptcy. Now you have the skimmed list. Based on your budget, research, and the company history/revenue/dividend/cash flow/debt and other things then buy the stocks. Category 2 stocks. Now I will list companies which saw immediate profit. These to buy when pandemic started. These are my instant buys. Kind of immediate profit growth. Scientists suggested wearing a mask, wash hands. So these personal protective items manufacturers stocks increased like 3M, DuPont, Clorox, purely Oil tanker to store overflowed oil like nordic American tanker, Frontline Ltd( sold this as soon as the oil consumption started and the price started going down ) People started subscribing to streaming services so Amazon, Netflix Grocery & home - Walmart, Home Depot, Lowe’s, Amazon, Due to homeschooling and work from home- zoom Vaccine companies - AstraZeneca, Pfizer These saw gradual raise. Meanwhile, some other changes also took place like Ford’s new car model release, apple iPhone release, Biden’s encouragement to electric cars led to new electric car manufacturers, lithium battery manufacturers stocks raise, chipotle came up with new safer ideas, due to Uber eats delivery Uber stocks raised, Disney opened, Lot of corporations got a bailout from the government. How to setup brokerage account- Please Note: I am not discouraging anyone. If there are any mistakes I am happy to correct. I am not a professional expert advisor/guru. These are just my thoughts and what I do. When we got married we both had the same idea of retiring early. So we planned accordingly. This is just my thinking even if we keep 100k in our savings account we don’t get good interest rate. So we decided to take some calculated risks and invest a small portion of our extra income/left over money from all the other saving investments in stock market. DH was into stocks investment even before marriage. But once after marriage, we both took it seriously. He wanted me to get into stocks and also he believes me as his lucky charm. There is no secret or special Formula to invest and make money. All you need is interest, understanding the numbers, lots and lot of time, energy and patience and of course, money to invest. Suppose if I want to invest in tesla I will see o How the graph looks? Where it will be in next few months/years? o What are the future goals of this company? o How it is going to bring more cash flow? o If it has debt, when are the long and short term due and how much? o Are there any competitors to this company? o What are its plan towards bringing more and more customers and plans on bringing production cost down? o Is this company planning to acquire any other companies?, etc…. This is how I started - · Luckily the company which I worked at that time had no restrictions on social media and YouTube and I also have this strange behavior of listening to something when I am working. So took advantage of that. · Initially, I spent more and more time watching videos on YouTube and reading blogs for beginners to understand basic terminologies. · Then I started watching the news, joined DH and his friend's group, joined discussions with my colleagues. Listed few stocks which are trending and going to get gain in the next few months. Of course DH guided me throughout the process of learning when I was in needed. · Then I opened a brokerage account practiced a few months with paper money then invest 2000$ first then slowly once I got comfortable I started investing more and started day trading. · Whenever one person is busy with office work other took care of research, watching the news, and noting down things, watching the market. · Mostly we made big money with day trading and bull and bear short term ETFs/proshare stocks. We bought bear stocks from 2019 thinking US election will fluctuate the market. But pandemic came and the bear went up and those bear stocks made big profit. Similarly we bought bull etfs when market went down and those started going up when bull market back to normal. · I also invest in few of the stocks which warren buffet invest which comes in my budget. · We also have lost 8k till now because of few stocks went to negative/few got delisted/wrong move. · If I am planning to invest 2000$ this month I always keep half of it to safer dividend stocks or long term stocks and rest for day trading. . Along with these market booming stocks I also do buy/sell Leveraged & Inverse ETFs like TMV, TNA, yang, spxs, dust, erx. · I will write a separate post on our journey to early retirement and how we planned what all we did to achieve our goals. Summing up few other points In August Tesla decided to split the stock (4 for 1 stock). Before the split price was above $500. This stock split bring down the stock price to 100$. Why does a stock split happen? When a company increases the total number of outstanding shares for the price of the same share effectively breaking one share into multiple shares. Those who had the stocks already got 4 for every stock. (we got lucky here). Similar things happened with apple. I don’t suggest the idea of buying 1 of Netflix amazon every month for 10 years. Why? Suppose I purchased 1 Amazon stock in January for 10$, in February if the price is 11$, then my average stock price will be 10.50$ when the market price is 11$ and I will be at loss. Though Amazon might give a good dividend. But it’s always safe to watch and buy for a lower price. Instead, do this check the market trend, it’s the lowest price in the last 6 months, 1 year, 2 years, 5 years, and then purchases. This is what I do I will check the price history and I buy 5-10 Amazon stocks and I watch if it goes still down than the last purchased then I buy 10 or 15 again in order to cover my loss and match my average price to the current price. As far as I know Telecom industry giants like T-mobile got debts due to it acquired sprint. AT&T got its by acquiring direct TV( was the biggest mistake. Now its trying to sell) and Time warner media and also its decrease in prepaid customers. Though AT&T got more new customers in 2020, new scribers for its HBO max. AT&T has great cash flow and debt to equity ratio still it is in safer place when compared to its other competitors and also its short term debts due percentage looks ok. Also due to 5G license telecom going to acquire more debt. It’s a long term plan. To see the gaining takes 5-10 years. 5G is big cap. First chip makers, semiconductor companies, antenna companies, phone manufactures, will see the again then it comes to telecom when more and more customers go to them. Slowly down the lane auto manufactures, manufacturing industries will the again from 5G. When you do the proper research and invest in right stocks at right time its fruitful.
thank you so much. very useful. I think it is time to split this thread and make another thread which has this detailed posts. Broker i would suggest go for other than robinhood/ webull. now the stock purchase and lot of etf purchase is free with good brokers too.
Very good post @Flyhigher. This is also a lesson for people to choose the industry carefully which is usually safe for their career. Most of us especially in IT would not bother about the industry we are in but only when such pandemic happens we realise that only few industries were able to survive the pandemic and were saved from job loss. The worst affected employees were from Oil and gas companies, Airlines, Travel etc
here is a Request , any senior folks , you can also advise when you are writing the final update. scenario : it is easy to make more money with more money . so example if i have 10000$ , i buy Bank of america , it rises 3 dollars in 3 months, i sell . Rinse and repeat. Good profit at year end. NOW the hard part . If i have 1000 dollars, or 500. how do i grow to 10k . yes i will do systematic investment, but again my savings will be 500 max per month. Also consider folks who are late in the race .
After reading all this and still not made up your mind about venturing into market safe avenue for investments is SCHEMES OF MUTUAL FUND . There are star performing schemes which in years time grow at least by 5 to 10% better returns than post office schemes where monthly payments available but principle locked for few years. TDS May or may not applicable. Sundaram blue chip new fund offer started few months ago as grown by 12%. It is worthwhile to learn and invest in MF selected schemes Hdfc MF too offer schemes that gives wonderful returns. You can dabble a little in stock market and good IPOs but safe avenue is MF. STILL BETTER IN EST IN SILVER AND OR GOLD COINS. WITH BEST WISHES
