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My past, present, future + opinions


Sep 28, 2007
This was recently a portion of an assignment I had to do for one of my classes.

It asked us to discuss our previous level of investing experience, our views on investing before / after having read the articles above, whether they have changed, and why, your future plans for investing and financial health, your views on retirement and the need for retirement planning, and what else you would like to know about investing.

Many aspects of it are goal and plan based.
(I apologize for the length, as it was required to be 2 pages for the assignment)

My direct exposure to the world of investments started when I was around 15 years old, after learning about the basics of the stock market from any resource I could find. My parents agreed to give me some money to begin investing. It was through one of my father's accounts, so I had to tell him when and what I wanted to buy and sell with my money. I remember doing oddly with the only two stocks I invested in at the time, Xerox and Gillette. Luck was the primary force behind my good start, but nevertheless it drove me to learn more and try to get better returns. After about a year in the market, I eventually cashed out and used the money to build a few prototypes of a product I had thought of. Unfortunately, all of those prototypes I made are still in the attic of my parents house. I didn't get back into investing until about 2 years ago after learning about technical analysis. At this point I was using Scottrade, but eventually made Trade Station my primary broker. After a couple months of successful equity trading, I decided to get into options. I used the same strategy that I used for equity trading and although it worked well initially, I didn't consider just how much more of an effect the aspect of time has on options. After almost tripling my money in a matter of months, and then losing it all in a matter of days, naturally, I decided that options weren't for me. After allotting more money towards investments, I continued actively trading stocks and building upon my strategy.
My views on investing haven't changed from before I read to assigned articles to now. In regards to the Motley Fool articles, I agree with many of the points that they made and understand their goal of educating the public about investing. My opinions differ about some aspects of starting investing early. I strongly believe in the use of 401(k)s and IRA accounts, but am not a fan of their restrictions and, in some cases lack of liquidity. As some of their articles said, compounding interest does wonders over time, but I have a less conservative approach. Investing a relatively small amount of money in an index fund over the long-run can result in a nice sum of money, even when taking inflation, capital gains tax, and the relative decline in the value of the USD into consideration. My primary qualm is the thought of if it worth putting the initial amount of money, and possibly additional regular contributions. I believe that in many cases, it is not worth the opportunity cost, especially for younger people who may not have as many overhead expenses and financial obligations as they will when they are older. At the youngest of ages, is when I believe the most (calculated) risk should be taken, as it will most likely has less of a negative effect on our lives if we bet and lose. The possibility of higher returns and the first hand knowledge one would receive from taking on such risk far outweighs the benefits of playing it too safe. To offset the higher level of risk taken at a younger age, I think a person can be more mindful of other things, such as possibly taking advantage of first time buyer programs and purchasing a home instead of renting or making salary a higher priority in their careers at the expense of other things, such as location. Overall, sound investment, even at the lowest of risk alternatives such as a high yield savings account, for anyone is a smart decision. I think that one's specific circumstance should be the primary factor taken into consideration when deciding what type of investments they want to get into. At the same time, however, I think there should be more emphasis on the benefits of risk.
My future plans for investing and financial health are not concrete by any means because I'm always looking for new areas of investment that I feel more comfortable with than whatever method I was most comfortable with previously. For now, I plan to continue actively trading stocks and working on new strategies to use during various market conditions. In this near future, I plan on starting a hedge fund, not only so that I can potentially turn my interest into my career, but also as a challenge to myself so that I have more incentives to try and get better and better returns consistently. The business plan that I plan on using will require me to live off of savings for over a year, so it will actually be the largest and highest risk investment that I've ever done. At the same time, though, what better to invest in than yourself? Creating a hedge fund will have some other benefits, though, including more favorable taxation. I would love to invest in real estate for the long term, but despite the huge percentage increases in foreclosures, I don't believe it will reach the peak of an ideal buyer's market for at least another year. As more time passes, I plan on becoming increasingly diversified, which will include less risky avenues of investment such as index funds and money market accounts. Regarding my overall financial health, especially during business start-up, proper budgeting will be a challenge. My financial health during my later adult days will be highly dependant on the risks I'm taking now, but with the number of high risk endeavors I'm always taking on, I'm confident that at least one is bound to turn out successful.
I view retirement as a life-long process as opposed to a big day. For every year that passes, I hope to have increased the number of vehicles of passive cash flow. The goal of this would be so that I can progressively retire. Assuming I'd be content with whatever salary that I would be making and that it was also enough that I could carry on my cost of living once completely detached from a job, then at a given point in time, for every dollar increase in passive income is a dollar less in value of time that I would have to work. A typical job, unfortunately does not offer such incremental flexibility, which is why I find it vital to be an entrepreneur and run my own business(s). Having other savings would also be ideal in the event of an emergency, but with this method, in a dire situation, the option to sell off the assets providing passive income is also available. I don't think a long-term, detailed retirement plan is necessary as long as a wealth-maximizing short term plan is being executed a all times.
There is an enormous number of things I want to still learn about regarding investments. One area I'm specifically interested in learning about is venture capital. It's not a field I can foresee myself getting into, but from what I do know about it, I love the concept. Another field of investing that I'm interested in learning about is foreign markets. We are becoming a global economy, so I believe it would be very advantageous to learn the behaviors of other markets around the world. I would also like to learn about currency markets, as I can foresee myself investing in other currencies. More specifically, I would like to learn about the foreign exchange market. I think taking part in that market can potentially be one of the best ways to protect your wealth, especially during times of economic unrest. Beyond these things, I have a general interest in learning about as many forms of investing as I possibly can. From that point, I can then decide if it's something that interests me. Whether they be things that I pass up on taking part it or not, having the knowledge of them can do no harm.

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Bronze Contributor
Read Millionaire Fastlane
Aug 29, 2007
Southern NM
You have a lot of ideas and a lot of areas that you seem interested in. If you haven't already, read the thread about How to develop your Plan.

Focus is key to moving in the fastlane. Keeping moving forward with what feels right for you, but don't dicount what others have already proven. In other words, you may not have to reinvent the wheel.

Also, regarding you statement:

"After almost tripling my money in a matter of months, and then losing it all in a matter of days, naturally, I decided that options weren't for me."

If you enjoy this avenue, look at this experience as just one way you found that didn't work. Don't give up on it. Thomas A. Edison said, "Results! Why, man, I have gotten a lot of results. I know several thousand things that won't work." :icon_super:

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