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Hubris1
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01-10-2006, 01:11 AM
Post subject: Getting started in investing advice (Noob)
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#1 (permalink)
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Straight
Join Date: Dec 2004
Posts: 163
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Warren Buffets of FTR I beseech you, gimme some advice. As of about six months ago I was a pretty big investment noob, since then I've been educating myself and I have run into a nice situation, but have yet to make my first buy order yet.
My company was just bought last week and my shares appreciated several fold their issue price, so I did pretty damn well. The last few months I had been putting away a good portion of my paycheck, and pulling out almost all poker winnings with the intention to move into stocks with about 60% of my assets (I'm 26, so this is a pretty good number.) Now I have enough from the buyout that I'm pretty raring to go.
I've read a half dozen books on the matter (from classics like The Intelligent Investor to kindling material like "Getting started in stocks!") but I'm still a little nervous.
I'm looking for more resources online or off that folks can recommend for me to educate myself, not looking for stock recommendations. (IE I don't wanna know if you would raise AJo but I'd want you recommend Harrington on Hold 'EM  )
Also, how do you prefer your trades, do you move securities online or go all broker, prefer mutual funds? Gimme your strategy here.
This is what I am looking at roughly right now.
60% in stock, diversified, max of 2 aggressive growth stocks per ten, max of 2 stocks per sector per ten minimum of one long term growth per ten.
10% in cash savings
10% in CDs
10% in bonds
2% for day trading securities and currencies
8% for poker.
I might pull some out of CDs and bonds and put it into real estate mutual funds, something seperate from stocks and bonds.
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Muxy
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4-of-a-Kind
Join Date: Apr 2005
Location: Canadian LOLUH'S AND AMERICAN LOLUHS
Posts: 1,529
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For Poker I got to a poker forum for investing i think iw ould go to an investing forum http://forums.moneysense.ca/forum.js...mID=14&start=0
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Hubris1
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Straight
Join Date: Dec 2004
Posts: 163
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That's exactly what I am looking for. Investing sites are arguably worse than porn sites for ridiculous advertising, self promotion and airy bullshit, I would like to avoid the bullshit.
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Warpe
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Moderator
Join Date: Sep 2005
Location: Canuckistan
Posts: 3,905
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I'm in the biz, Hubris, so consider this free professional advice.
Don't know what your bankroll is but unless you've got $150K or more, I would suggest that you will be best served by mutual funds. Yes, you could buy individual stocks but you probably couldn't get enough diversification (own enough individual securities) to be adequately diversified to ride out any market downswings (and the next couple of years could be rocky), and it just takes one or two of your stocks to tank to wipe out your gains on the others. Mutal funds will give you the diversification you need.
At your age, your time horizon is long so your asset mix sounds about right - 30% fixed income (cash, bonds, guaranteed investments) and 70% equities (I'm leaving out your day trading and poker money- that's play money) - and I'd classify that as a "growth" investor. In fact, you might even want to be closer to 100% equities because you have many years to ride out market cycles, but that depends on your risk tolerance. Long-term, get as much exposure to equities as you can stomach, as that will give you the most growth.
As far as being a do-it-yourself investor or working with an advisor goes, I'm an advisor so I'm biased - but there are just as many donk DIY investors as there are donk poker players...and there are also donk advisors. Best advice: Do your homework, find some good investment sites, and educate yourself.
Like poker, the secret to investment success lies in sticking to basic proven principles and looking at the long view. Dollar-cost average into a well diversified portfolio appropriate to your risk profile with patience and discipline - and ignore the daily financial headlines, or financial "porn". Nobody, and I mean nobody, can predict what the markets will do in the short term, and today's guru is usually tomorrow's goat.
Quote:
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Originally Posted by Muxy
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This is a Canadian site and one of the best we have. Basically, it is geared to the DIY investor. I used to post there to answer investment questions, analyze portfolios etc. but it was like beating your head against a wall with some people and, quite frankly, wasn't worth the time. Still, lots of good content. Don't know any US equivalents.
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r8ed
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4-of-a-Kind
Join Date: Jan 2005
Posts: 1,524
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Does your company offer 401k? If so, max it out.
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Blinky
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Flush
Join Date: Jul 2005
Location: nutpeddlers anonymous
Posts: 459
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Check your email. I hear there's some great stock tips there
Seriously speaking - and from a Canuck perspective - I would generally echo what Warpe says. I started at about the same age as you, Hubris, and decided to invest via mutual funds. You will need a pretty sizable wad to make a diversified stock portfolio, and unlike poker, busting out in your savings is a major suck.
If you only have a few thousand dollars what you'll end up doing is tantamount to coming to a poker table with a 20% buyin and pushing something like KTo. Don't do it.
I had a friend recommend me this site a few years ago:
www.fool.com
Don't know if it's still any good.
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Quote:
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Originally Posted by Rondavu
We will not support your pocket pair aggression.
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Warpe
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Moderator
Join Date: Sep 2005
Location: Canuckistan
Posts: 3,905
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Quote:
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Originally Posted by Blinky
I had a friend recommend me this site a few years ago:
www.fool.com
Don't know if it's still any good. |
I'd forgotten about that. I used to poke about there a few years ago but it's US based so not much good for my day to day in Canada. Nevertheless, an excellent site.
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Lukie
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4-of-a-Kind
Join Date: Jul 2005
Location: back with a vengeance
Posts: 3,307
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My bank has an investment guy (a pretty reputable one too) that I went to. I told him I want to invest $15k geared toward long term growth. So we put $11k in various high-risk, high reward type mutual funds and $4k in an IRA. That was awhile ago though, and I've been meaning to go back since to add to that...
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