Investing can seem to be rather daunting and sometimes just plain confusing.
When I started investing, I did not even know where to begin. It was like watching
Spanish Television when I would turn it on. I was watching CNBC Fast Money
one day, and saw this loud mouthed, bald guy having a meltdown right there on
television. He slammed his hand and the table and shouted, “They have no idea!
Absolutely none!” The more I watched, the more I was entertained. We all know
his name. It was Cramer.
I remember listening to him and thinking, “Wow, I don’t think I would know as
much as he does.” But, the more I learned, the more I understood that you don’t
need to know many symbols, earnings and a bunch of investment jargon. That
would confuse most people when you open our mouth to speak. I guarantee you if
you go to a dinner party talking like that, people will have that blank stare on their
faces. As they are drinking their Martini, they give you that proverbial nod with a
half a smile. 9 times out of 10, they would be thinking how could they retreat and
get out of this confusing conversation. The wife or husband would come rescue
them. Another scenario, you have those people who have lost a fortune in the
2008 Financial Crash. They will utterly take over your conversation with what
seems to be comparable to a “War Story,” and go on an hour long rant about what
Investing does not have to be so complicated. It just takes an open mind and
common sense. I want to give you a few tips that have helped me in my quest in
becoming a Seasoned Investor.
1. Ask, ask, and then ask again.
When approaching investing, there is never anything such as a dumb
question. Begin by calling financial advisors. Call at least 5, but no more
than 10 advisors in your local area. Go to your local bank and sit down
with a banker and ask them about stocks, bonds, etc. and what is yielding
the highest dividends. Ask friends and family members who may have
accumulated savings what they are doing in investments. Make sure to
talk to people whom you know are well capitalized. When compiling
information, you will begin to see patterns emerge. For example, if the
bank and the wealthy friend or family members are saying they’ve been
seeing nice returns in bonds, then start seeking to invest in bonds. These
specific patterns will act as a light bulb and it will become easier to follow
the successful herds straight to the bank.
I love this mantra! Keep It Simple Stupid…Never over complicate things.
Many people fail at this part because the majority of people are lazy and
don’t prefer to learn for themselves. These are the people that have the
deepest scars from the 2008 Financial Crash. They complain, but
they never take the time to learn from their previous mistakes in mastering
the systems and methods to assure their nest egg grows. I spoke with a man
that works in the corporate world and asked him how was his portfolio was
doing during the latest boom in the market. He stated to me, “I just met with
my financial advisor. I have no clue. I just told him here is another 20K.
Just put it somewhere.” He explained what transpired at the meeting, as if it
was some kind of Dentist appointment or something. I like Warren Buffet’s
approach. He recommends investing in things you like. For instance, if you
like going to the movies, find out who produces those movies, start watching
those companies symbols and find out if it is a good company. Then make
some calls and invest. See, that’s simple. What I want to point out is once
you start paying attention, you will increase in knowledge and the more you
will find ways to start making more money, growing your nest egg.
3. Learn From The Past
Our country had a major set-back in 2008 and it took much money out of
people’s pockets. Many people got really burned by it all. Many people
have negative views about Wall Street and investing. But, what you will
hardly hear in the news is how many people got wealthy betting against the
real estate industry. Because of the slowing economy and uncertainty that’s
in the markets, people are very leery of investing. But, this is a neat trick
that I have learned. Ask people or acquire information through Google
which companies perform the best post and after the Crash of 2008. You
will find some very good companies that not only weathered the storm, but
thrived in times of calamity. We have had “Boom” and “Bust” cycles
within our system since we established a free market. Maybe even before
that. “Boom” and “Bust” cycles are just the nature of the business. Since
it’s an emotional mechanism, one just has to know which cycle that it’s in.
Right now, we are heading out of the “Bust” cycle and are poised for the
next “Boom.” I read an article about how the truly wealthy people are
starting to invest in Real Estate, because they sense that Real Estate is
undervalued and are willing to invest. Once you know how these companies
perform under pressure, you can be reassured that this is a company that can
be trusted. My eye is on Wal-Mart stock (WMT). They have weathered the
storm through 2008. Although, their stock just recently took a beating
because of legal troubles they were under overseas. But, fundamentally,
they are yet a good company. I actually love shopping there, because they
have really good prices and, they’re re-committing to hiring thousands of
US workers at their stores. If you really talk to successful traders, they
don’t have many complicated strategies. They just have a handful of
method they utilize to invest and that’s it. They make millions of dollars in
the process. Linda Brandford Raschke of http://www.ibgroup.com, one of
the industry’s top traders, says you only need 1 or 2 good methods to make
money in investing.
In conclusion, keep investing fun and learn all you can. There are a myriad of
opportunities all around you to which you’re not paying attention. Once you open
your eyes, you will begin to recognize things you never even noticed before. If you
invest in the knowledge, you will ultimately see returns almost immediately.