So, I've recently begun investing my money, which up until now has either lain dormant in a bank account or in some fund from long ago. I think I've learned a lot in this short time, by making many mistakes of course. Some mistakes/things I learned/thoughts:
- It's a mistake to listen to other people and their stock picks; especially people that says a stock will rise an awful lot in a short time. Or rather, this is dangerous when I can't asses the business and judge whether this is reasonable or not. Why do you make this mistake? Greed makes you think like an addict.. Fortunately I managed to get out of the way and sell (with a small profit aswell, woho luck) my stocks picked in this way.
- Learned a lot about value investing a lá Graham and Buffet. This will be my style of investment going forward.
- I bought stock that I didn't really believe in in the long run, but which I think might be undervalued at this time. Is this wrong? Personally I don't like it. My money should buy a part of a business that I believe in.
- Learned that investing and the greed that is associated with it can hijack your brain and cause many irrational, and costly, decisions.
- Learned that courtage will eat your monies if you trade a lot.
- Learned that many so called analysts suck big time.
- Learned that there is a lot of irrationality in the stock market. Stocks can be very overvalued or undervalued. Undervalued stocks is a road to riches.
- Take it easy, don't chase after opportunity. If you do you'll likely make mistakes, plus it's quite fatiguing.
- I know that I have a lot of technical stuff to learn (how to read reports and evaluate the company based on them).
- I learned that it'll be very hard to follow these learnings - my primate brain tells me to do otherwise.
- Try to stick with companies that you understand.
Dec 27, 2012
Thoughts about my stock picks for 2012.
A sizable chunk will be apple which has an undervalued stock at the moment (p/e of 8-10, where the lower value is the adjusted p/e due to their enormous amount of cash and no debt). Their business is amazing and they consistently find new markets and dominate the profit share of the existing ones. Given my current level of understanding of them I at least believe in them for a few years, or as long as Jobs' ideas are churned out. I don't know about longer though, I'll have to investigate further (who is Tim Cook?).
A sizable chunk will be avanza zero, which is an index fund without any fees. I keep this as a kind insurance against my newbie decisions.
A sizable chunk will probably be H&M, a very good company going forwards. A bit expensive at the moment though, will look for a better opportunity to buy.
A medium chunk will be Arcam, a 3D printer company. 3D printing is a very interesting technology and it will change the face of personal and industrial manufacturing in the relatively near future. When looking for companies to invest in this was the only company with a reasonable price tag, p/e 25 (although a lot of profit is expected for the next quarter). They also have a large amount of capital, and they don't seem to have much competition in their piece of the market. Other public 3D companies are 3D systems and Stratasys, although they trade a bubble prices right now (p/e close to 100), and I'm not interested a the moment.
A small chunk will be Lundin Petroleum, based on their history and current findings. I'll need to look into them more though.
Another small chunk will be Boule Diagnostics. Looking at their numbers, business model, outlook and management I'm fairly impressed.
Another small chunk will be Endomines, which is a rather small goldmine in Finland with fairly good numbers (amount of gold produced, no to much debt). They seems to have good management aswell, who in turn own a lot of stock in the company (and much of it recently bought). They still loose money though. We'll see, I keep this company in large part because I want to learn how they behave, and I'm ready to pay for it..
The smallest chunk will be Seamless distribution. They provide payment by mobile phones. I like their performance thus far this year and I like their product, CEO and their business model (to basically drastically reduce the cost for vendors during payment, credit card companies eat a large part of the profit for many vendors. Follow the money..). I give them a reasonable chance going forwards.
Looking over it many of the companies are not in line with the Graham/Buffet school. But I want to learn how these companies, and their markets aswell as the stock market, work and small investments in them provide excellent incentive.
A sizable chunk will be apple which has an undervalued stock at the moment (p/e of 8-10, where the lower value is the adjusted p/e due to their enormous amount of cash and no debt). Their business is amazing and they consistently find new markets and dominate the profit share of the existing ones. Given my current level of understanding of them I at least believe in them for a few years, or as long as Jobs' ideas are churned out. I don't know about longer though, I'll have to investigate further (who is Tim Cook?).
A sizable chunk will be avanza zero, which is an index fund without any fees. I keep this as a kind insurance against my newbie decisions.
A sizable chunk will probably be H&M, a very good company going forwards. A bit expensive at the moment though, will look for a better opportunity to buy.
A medium chunk will be Arcam, a 3D printer company. 3D printing is a very interesting technology and it will change the face of personal and industrial manufacturing in the relatively near future. When looking for companies to invest in this was the only company with a reasonable price tag, p/e 25 (although a lot of profit is expected for the next quarter). They also have a large amount of capital, and they don't seem to have much competition in their piece of the market. Other public 3D companies are 3D systems and Stratasys, although they trade a bubble prices right now (p/e close to 100), and I'm not interested a the moment.
A small chunk will be Lundin Petroleum, based on their history and current findings. I'll need to look into them more though.
Another small chunk will be Boule Diagnostics. Looking at their numbers, business model, outlook and management I'm fairly impressed.
Another small chunk will be Endomines, which is a rather small goldmine in Finland with fairly good numbers (amount of gold produced, no to much debt). They seems to have good management aswell, who in turn own a lot of stock in the company (and much of it recently bought). They still loose money though. We'll see, I keep this company in large part because I want to learn how they behave, and I'm ready to pay for it..
The smallest chunk will be Seamless distribution. They provide payment by mobile phones. I like their performance thus far this year and I like their product, CEO and their business model (to basically drastically reduce the cost for vendors during payment, credit card companies eat a large part of the profit for many vendors. Follow the money..). I give them a reasonable chance going forwards.
Looking over it many of the companies are not in line with the Graham/Buffet school. But I want to learn how these companies, and their markets aswell as the stock market, work and small investments in them provide excellent incentive.
Dec 24, 2012
And so a new journal is started
I've written a lot of different journals through the years, on different platforms and covering different topics. But the purpose of all of them have in some sense always been to help with personal growth, to study and write about my interests and for general journal keeping. The difference between them therefore lie in what has been most pressing issues on a personal growth level and what my interests have been, however the interests have been fairly stable. This journal will probably have the same purpose.
So, what does this translate to on a practical level? I think you can expect to see posts about:
- Rationality, what it is and how we sometimes suck at it.
- How to become more rational.
- Economics
- General economics
- Investor economics (fundamental analysis - I'm a noob but interested).
- Startups - I want to be an entrepreneur some day.
- The whys in life.
- Programming - work and often a hobby.
So, what does this translate to on a practical level? I think you can expect to see posts about:
- Rationality, what it is and how we sometimes suck at it.
- How to become more rational.
- Economics
- General economics
- Investor economics (fundamental analysis - I'm a noob but interested).
- Startups - I want to be an entrepreneur some day.
- The whys in life.
- Programming - work and often a hobby.
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