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Stocks & Bonds: Moneypete's two cents worth
Stocks, bonds, mutual funds, commodities and the world of portfolio investing is an exciting world. Billionaires are made overnight when companies go public. You mention “Wall Street” and everyone has a certain picture in their mind. The picture varies from person to person, but it includes many of the same qualities. Most of them include lots and lots or money and rich looking things that are solid wood, concrete and steel. The stock, bond and commodities markets have their own language and culture. If you want to get seriously involved, you must master the language and commit to a lifetime of study and participation.
That sounds rather ominous, but the greatest minds in history who have “played” the stock market can take the language and the culture and make it sound rather easy. Warren Buffet, for example, has a great way of simplifying the stock market for everyone. Here is a great book about Warren and his investing principles. “The Warren Buffet Way” by Robert Hagstrom is an excellent book to digest Warren’s thoughts on how to invest.
His basic ideas are to keep your portfolio small and manageable. He suggests no more than 10-to-20 stocks at the most. Don’t have too many baskets so you can keep an eye on your eggs. He also only invests in things that he understands and things that he knows have intrinsic value that will be around for awhile. Warren has said many times that he doesn’t understand the new wave of computer technology so he doesn’t invest in it. Warren does, however, know that Coca Cola has been around for over a century, is still going strong, and people will be drinking Coke for a long time to come. He has a cherry Coke almost every day.
There are other elements to his philosophy as well such as having confidence in the company’s leadership and the price of the stock being right. He says if the price is lower that what you think the intrinsic value of the stock should be it is a good time to buy. Investing in what you know about or what you are passionate about is probably the best tip I have ever heard in the world of investing. It is the same axiom that entrepreneurs should hold. Start a business that you are passionate about or invest in a business you know about and are passionate for. There are many investment opportunities out there to keep you busy. There are stocks, bonds, mutual funds the commodities markets and more. Let Moneypete.com give you some sage advice. While you are learning and gaining knowledge in this investment area, find an expert that you can trust to help you navigate through the waters. There are many great companies out there for you to shop. Moneypete.com has links to many of them in this section. In this area of investing it is better to have a designated driver while you are learning to take the wheel yourself.
