About Us
A group for beginning investors to ask questions and learn the ropes and learn from the collective knowlege of the TK community.
Active Since 02/18/08
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Keepingitsimple
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Posted February 18, 2008 (03:57PM)
Thought this might be a good topic for beginners to see what some people did before they put real money on the table for investing/trading. Please feel free to tell your story. Hopefully these stories will help people. In 2003 I started getting interested in investing. The very first thing I did was grab a couple of books to learn about the market. The books were ‘Come into my trading room' and ‘Trade your way to financial freedom'. These books offered very good material that investors/traders need to be aware of. The third book I bought was ‘Reminiscences of a stock operator'. To this day I still feel this is the number one book I have read. Very early on I realized that Cramer or any other stock expert would not hand me the keys to the castle. I decided to create a strategy that would allow me to be comfortable putting money into the market. Once I felt I had a handle on things I started paper trading. With paper trading I could loose all the money in the world and it would cost me anything other than time. My first idea for trading/investing was shot down within a couple of months. Basically it was just picking the most popular names I recognized. After some severe losses on paper I ditched this method since I had no idea why these popular companies were going down. As I look back, some of these companies have lost 95% from the time I originally put them on paper. Some of these companies are no longer listed on the market. After the bid losses on paper I went back to the books to gain a better understanding how to look at companies. Once I felt I had a better understanding of the fundamentals in a company, I went back and started paper trading again. By the beginning of 2005 I developed two strategies that I was comfortable with and then started testing the crap out of them. In order to keep track of these list I put them on Investopedia.com. It's a free website that allows a person to paper trade electronically. The site allowed me to test my strategies and actually go thru the process of entering trades without having to put real money at risk. Over the next couple of years the two strategies I use were tweaked and tested several times. While I still do get some bad stocks that show up from time to time, no strategy is 100% perfect. During this time the market swings would help me create some type of tolerance for what happens to a stock when it goes up and down. During the summer of 2007 I felt that I was finally ready to put money in the market. Sure enough within the first month the market had a correction. I didn't panic like someone probably would if they were just beginning. Although I hadn't used real money in the past I had been in those situations before. While I will be the first to admit that the time I spent on investing/trading before my first real trade was a bit excessive. The time spent helped me understand what risk I was comfortable taking and which ones seemed excessive for my personal preference. Trading/investing is a constant learning process. What works for one person will probably not work for another. If there is one nugget of information I would give to a beginner it would be this. It's your money, don't let other people tell you how to spend it.
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Lochlainn
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Posted February 18, 2008 (10:49PM)
Thank you very much for your post :-) Last week I registered for a stock simulation account on Investopedia and am looking forward to learning the ropes. Thanks again for your post.
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Casey
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Posted February 19, 2008 (12:24AM)
Very helpful simple.
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UPod
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Posted February 20, 2008 (03:04AM)
My story goes something like this: About four /five years ago, I went to a "Get Motivated" seminar for work. Out of the 10 or so guest speakers, one stood out. His name is Phil Town. His story is basically a rag to riches one that was accomplished with the help of a Warren Buffet protégé who took him under his wing and taught him how to invest in the market. His story really captured me - mostly because he was in the Special Forces and I'm also an Army veteran. Anyway, I left the seminar fairly excited about his story, practiced some of his ideas on paper for a little while, and then mostly just forgot about the whole thing.
Fast forward to September 2006, I wound up getting a magazine at work called "Success". Low and behold, guess who's on the cover? It was Phil Town. They did a cover story on him. Here's the article:
http://www.successmagazine.com/article.php?article_id=10
I recalled seeing him speak at the Get Motivated seminar, so I wound up bringing the magazine home with me that night and read the article about him. Right then and there, something just clicked in me and I got really all over again about his story and the idea of investing in the stock market. Knowing he just released a book, I bought it the next day and read it cover to cover. I also bought it on CD and listened to it on my drive back and forth to work every day.
About two weeks after I finished reading the book, I practiced some of his ideas on paper for maybe around a week or so. I then opened my account with TradeKing. I had exactly $1000.00 just sitting in a savings account, so I wired that over (I was too excited to wait for the 5 day ACH transfer). About two days after that, I made my first trade. I didn't paper trade or ask for advice from friends or family. I just jumped right in head first. It's been a learning experience ever since. Investing and following the market is now a hobby and a passion for me. I absolutely love it. There's never a dull moment.
I don't mean for this to sound like a plug for Phil Town or his books. I actually no longer follow his investing style. I do give him 100% credit for inspiring me to invest in the market though.
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Casey
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Posted February 20, 2008 (03:40PM)
Upod, if you have no use for the CD's, I wouldn't mind talking to you privately about buying them from you so I could listen to them.
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pman1972
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Posted February 20, 2008 (05:30PM)
Outstanding stories! My first "do it yourself" lesson was geared to really learning what I already had ... a 401(k). I bout a tiny book for $7 from Amazon.com called 'IRA and 401(k) Investing' by Marc Robinson. The easiest 70 pages I've ever read on investing. After that, I picked up other books in the series including 'Choosing the right stocks'. This book gives basics like what's an exchange (NYSE, NASDAQ, etc.), what's an IPO, etc. Very simple definitions in plain english. I received a bonus from work (if you want to call it that) and decided to open an eTrade account and jumped in head first. I flashed over to the NASDAQ site and pulled up the list of the top 100 performing stocks. First, I spent more money on the eTrade commission than I did buying the books I read! The stock fell like rocks after two months. Then a reverse split six months later. The company merged with another, changed its name and fell some more. I vowed to keep the stock as a reminder of my first trade. Sometime, mid last year, I completely ditched eTrade and switched to TradeKing (much better rates).
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mjuaire
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Posted March 19, 2008 (10:25AM)
For Someone like myself, who literally funded my account with Tradeking yesterday, and has no clue whatsoever about what i'm doing, I truly appreciate your posts. I only have a little $$ in an IRA I opened up, but everyone has to start somewhere, I just figured it was time for me. Thanks again.
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UPod
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Posted March 20, 2008 (03:46AM)
Mjuaire - My line of thinking was exactly the same when I opened my TradeKing account - you have to start somewhere - and I'm glad I did. It's been a great experience and really educational. I almost consider it a hobby.
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MadSkielz
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Posted March 30, 2008 (10:16PM)
As bad as this might sound, I thought I would chime in with my story. I have had all of my money in CD's for the last 5 years. With the rates now in the threes, I have been thinking about getting into the stock market for a while now. Randomly flipping through channels, I would sometimes stop on CNBC. Half of the time there would be some crazy guy in a hat or outfit screaming about stocks. Pretty soon I would catch myself tuning into his show once or twice a week. I knew absolutely nothing before it, but after watching Mad Money everyday for about 4 months, I decided to jump in. I've read all three of his books and a few others. I know there are plenty of people that hate him, but he does an amazing job at dumbing down the stock market and setting basic rules that I would have had no idea about on my own. I did a lot of research on which online broker I was going to choose. First, I thought I was going to go with Etrade, but I found some customer review site and they were tearing it apart. Then it was between TradeKing and Scottrade. Decided to go with TradeKing. Wired in 10,000 and bought the Visa IPO on all the hype. I am only down 2.00 a share right now, but I am going to hold onto it for a while. Now I'm also down on Intel, Walgreen, and Oracle........ But I'm still reading lots of books and hopefully learning a lot more from everyone here. I don't know anything about IRA's, but everywhere I go, I keep hearing about them.
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Woody
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Posted April 28, 2008 (12:09PM)
My story! Been interested, sort of, in investing for a couple years. Then, I was listening to an ad on the radio for a "school" to teach trading. It was free, so what the heck. So last August, I went to the seminar. Very inspirational! Several months later, (and $14K invested in the education) I was into investing, but now with no money to invest in. Luckily, we were about to move overseas and used that to get about $10K back. Also from August, I had been "Paper Trading", but I did not have the discipline to record all the trades, did not watch the stocks, misplaced the journal, changed the way I wrote everything down, etc.. You name it, I did it!! I watched my IRA dwindle from >$10K to <$9K in January and decided that I could do better. So I transfered my IRA to Scottrade in March. Am currently moving that account to Tradeking. Also have another Tradeking account that I trade options with. Right now stocks are up, options are down.
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VegasTrader
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Posted October 06, 2008 (05:10PM)
Some great stories here! So here's mine. I got my start reading a Kiplingers magazine one day at work and I saw a contest. It was called "Win Knight's Money". I thought to myself, you know, there are only 2000 entrants for this contest, what are the chances I'd win anything? Well, I entered and struggled at first, but low and behold, I became the January winner for the most improved stock position! It paid me $500 and a trophy. In the end I was relegated to accept something like 17th place overall. The good part is that it taught me that I may know nothing about trading, but I sure want to know more. So I read 3 of Revernd Jim Cramers books and probably 2 dozen online articles and decided to finally jump in. It's only appropriate that I decided to start funding my account using the $500 I won from Kiplingers. Let's just hope I don't loose it all right off the bat! Wish me luck fellow traders, and I wish you all the best luck as well. If anyone knows of a veteran trader who wants to mentor me a bit, let me know. I'm from Vegas, but I believe in a sure, educated bet over a hunch!
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snowman
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Posted October 12, 2008 (03:45PM)
Good stories. I felt I knew a little bit about stocks since I had been following them since 1985. Started investing in March 2007 (15,000) Lost 8,000 and found a stock I felt would get bought out. Put everything into that stock. I ended up 31,000 ahead on that stock. I sold out and hour early and lost 14,000 but I could not afford to lose 31,000 in options. I am up roughly 14,000 this year with between 4,000 and 17,000 invested at any given time. 5,000 right now. Been searching and searching and asking questions on message boards. Because I noticed it did not matter what my company did, it mattered more or less what the market was doing and the specific index my stock may be in. So this is what I came up with. Money supply is the most important factor. China, US, Russia, Europe and others realease money into the system by many methods which has become all the news as of late. When the Fed. cuts interest rates it is really a sign that stock are going to go down. They go up because now there has been X amount of dollars added to the system that was not there before. This money will be put to use and some of it makes its way into stocks. Why has this not helped? Well 1 out of 10 people are not paying on their mortgage. On top of that the mortgages are for 20 to 30 percent above the value of the homes. Normal loss would be 30% and now it is like 50 to 60%. That is money or wealth distruction. Close to 1.5 trillion so far. The other thing is the consumer has more debt than anyother time in history and cannot borrow any more money. There is more, the faith in how these consumer loans were written and procesed has been lost. So that 2 billion a day we were recieveing from overseas is now gone. Yet we still have to pay on what we borrowed so money supply is going down on that level too. Banks took out many short term loans in 2006 and 95 billiion came due in Sept. more money out of the system and have another 260 billion to pay back in the next 14 months. Also there is estimated to be 1.6 trillion dollars on the sidelines in cash waiting to be invested by money managers and hedge funds. I could go on and on. But I am hoping that you are getting what I am trying to say. Money is like a commodity and available amounts and where big money puts it next is your job to figure out. When I bought KOMG the company that was bought out by WDC they got a loan at 2% interest. Loans now are running closer to 10% which means 8% less profits. So keeping an eye on Libor is extremely important at this point in investing. Libor is set in London by bond sellers and buyers the international exchange for money and it affects over 450 trillion dollars in loans. I suggest using puts if you feel a stock is going down and buying the stock if you think it is going up. Remember puts give you a 100 to 1 leverage so you would use a lot less money. You can always hedge that by buying calls in an index too. OR puts on Dec for example and calls for Oct. or Nov. Many site list libor rates: http://www.cnbc.com/id/26905693 Wallstreet journal Yahoo and others. My feeling is that interest rates will rise and that will eventualy drive us into a depression where stocks typicaly have a P/E of 6% to 8%. Debt in the world is over 500 trillion and in america around 180 trillion. No matter what anyone says the government does not control that the bond sellers do. That is too big a #. If you are unfamiliar with our financial system I suggest you watch this simple video. Even if you do understand it I suggest you watch the video. Good luck trading. http://video.google.com/videoplay?docid=-9050474362583451279&ei=yfTkSIiMJ4qCrQLlxtycCw&q=money+as+debt
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pjensen07
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Posted October 14, 2008 (04:22PM)
I am brand new to trading and I love the fact that I can learn from my Tradeking friends. I just opened my account with a few hundred bucks I bought aig, and wb I am currently up 30% with wb and down 20% with aig. It has been so fun I invested more money and am awaiting to invest it. aig is going to go up I am sure so I am not selling. I guess what I am saying is I am having fun but I will not invest more than I can loose... Any senior traders have any pointers for me let me know Thanks. Loved your stories
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gr81
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Posted October 24, 2008 (05:56PM)
I have followed the market and specific companies since high school many moons ago when we did a project and were all given so much fake money to play with. I did well and by the end of the school year had a decent profit to show for it. I have played with simulations in the past and every time I did well my wife would ask why I don't just start a real account. Like many people I thought that I needed to have thousands of dollars to start but never really researched it.
So we finally just recently we opened our account here on Trade King thanks to a friend who will appreciate the referall fee after telling me about this site. I bought "Investing for Dummies" a few days ago and have been trying to learn about all the little things that when playing for fun did not come into play that I now will have to understand. Taking baby steps but finally getting our feet wet.
Short term goal is to build up some long term investments in stable companies with decent dividends before venturing into higher risk choices. Like I said, we started the account recently (2 weeks ago) and started funding it but have yet to dive in but I see that happening real soon.
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Arman
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Posted November 23, 2008 (05:16PM)
Hey MadSkielz ,
Sorry to hear about your loss , in a economy like this the market is more volatile then usual , one piece of bad news can bring a company to its knees. I would start reading about Options excersise and Stop Loss and Trailing Loss which can limit your loss. In Options you have the potential to make money when a stock is losing value although I don't understand the Options very well I would definitely look into it and there are many helpful members here at TK who can point you to the right direction. BTW Just wired some $$ to my account cant wait to get started :)
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Mattdive
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Posted November 25, 2008 (07:53AM)
Thanks for all the stories and advice. I am also new to this. I have a TSA through work, but don't do much with it (AmEx broker handles it for me). I've wanted to dabble in the stock market for some time and felt that with everything "bottoming out" it would be a good time to get in. I have no clue as to what options are and how to use them, and I have a very basic understanding of stocks and securities. I've noticed that most of the educational materials on Tradeking seem to be geared towards options. What I need is a basic tutorial as to how to start (I'm waiting for my funds to transfer over). Any help would be appreciated.
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Lehman Unlimited
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Posted November 25, 2008 (03:32PM)
Good Morning Everyone. My wife and I made a decision to get busy with this whole stock trading thing. We are as green as they come when it comes to trading stocks. Yes we put money in and out of the company 401K thing in the past. We've been in the Automotive business, the Mortgage Broker business, the Manufacturing business, Retail, and Fast food, etc. not in that order.
We like the idea of buying and/or selling stock when we want to. We jumped in and bought a small amount of GM and then GNW and since then we SOLD everything. We are not looking to be greedy, if we can average 10% with each sell and compound our money by reinvesting we will be very happy.
In the near future when the markets seem to settle down and start slowly climbing we want to get into some investing for our future, but we will still continue to try and buy LOW and sell HIGH.
SInce we opened our TRADEKING account (11/12/08) I've asked for and received help from some TK members and TK staff. Everyone has been very helpful. Thank You...
This is how we see it. If your new start researching and trading small amounts because when you start trading you'll come across several questions and for us this was a good time because we learned how to get started. I always say the best way to learn is to DO IT. We figured if we do small amounts the learning won't hurt as bad.
I heard someone say years ago. I would rather be lucky than good anyday!!!!
Good Luck making $$$$
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drai
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Posted August 26, 2009 (03:17PM)
Awesome stories!
I just started trading this month after learning, reading, monitoring and watching professionals talk about the stock market. In 26 days i've had a return of 23%. I am excited because I am only a beginner like most of you here. I look forward to learn a lot from all of youand to understand options, commodities, futures etc....
Thanks for all your comments.
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DuwStocks
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Posted August 31, 2009 (03:26AM)
Cool. Nice return so far. Especially if you just started. I started around 2 years ago, but I really should say I ended. Used sharebuilder put a few dollars on stocks, left it alone, despite all the reading. I was clueless. This month I was fortunate to take a Rich Dad series Guide to investing workshop. Now I feel empowered. I still plan to learn and read more.It feels like how some people go to the military straight after high school and start at the bottom, but I went to college and after enrolling I was immediately given a higher rank......
Most of my focus will be towards technical analysis and for software I use Edutrader.
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The Digital Man
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Posted September 26, 2009 (07:00AM)
My first experience was back in 2002. I had switched jobs and I transferred 1000 sitting in the 401K account with my previous employer into an E-Trade account. I planned to trade penny stocks and get rich! I lost every bit of that money. It seemed everything I touched turned to dust. After it was gone I wondered to myself if I wouldn't have done better buying more solid stocks like Apple & AT&T. I nursed my wounds and told myself I just wasn't cut out to make money in the stock market. I have since decided that is not the case and I should try again. However, I'm not going to try investing in penny stocks this time around. I had not been totally satisfied with my experience at E-Trade and so decided to try a different brokerage firm even though I had the open account at E-Trade it was a self directed IRA account and I wanted an account that was not earmarked for retirement. Rather than open another account with E-Trade I decided to look around. I liked what I saw here and I'm glad the search engines showed this place because when I first sat down at the computer I was thinking "Ameritrade". The money I'm going to be investing is my "Self Directed Health Insurance Fund". That's what I call it. Say what you want but when I finally graduated from College and got my first "real" job they covered me with health insurance but I had to buy it for my family. And even though I thought it was a bit high my wife insisted that we should have it. I paid $65 a week to cover my family back then. That's $3380 a year. It had a $500 deductable per person, $1500 deductable per family. I had one child about 3 years old. The first year I shelled out roughly $1000 in medical care between the 3 of us but none of us went over the deductable. The second year of having the insurance my wife racked up $600 in medical expenses all by herself. So as I recall we paid out about $1200 that year in medical expenses and the insurance company reimbursed me $80. But of course you carry insurance for the "Peace of mind" it gives you. So we lived on quite peacefully. Toward the end of the third year of having this insurance my daughter became ill. She began running a temperature and we couldn't seem to get it to come down. Then she started to go into seizures and we ended up rushing her into the emergency room. The hospital stabilized her but told us they were concerned and wanted to send her 30 miles north to a large children's hospital where they would be much more capable of dealing with her than they were. So into the ambulance she went and an hour later we were at the BIG CHILDREN's hospital. They wasted no time in poking and prodding her and called in several specialists. I remember sitting there in her room and thinking to myself, "This is what I have the insurance for. I'm so glad I listened to my wife and paid for it all these years." Fast forward a couple months. The medical bills from the entire event start pouring in and I'm giving them to the lady at work to file with the insurance company. The total expenses ended up running right around $3,000. I knew I would have to pay the first $500 and I figured I would pay 20% of the remaining balance which would be another $500. So I was getting prepared to shell out the $1000. Than I start receiving notices from the insurance company that they don't cover particular types of specialists or that I had to get prior approval for a specialist before having the procedure done. WTF! So I guess what I needed to be doing up there in the emergency room rather than holding my breath and saying prayers for my daughter was "screening" the healthcare personnel that were taking care of her. I should have stopped each and every person and asked them if my insurance was going to cover their services before letting them touch my daugher. Of course that idea is totally ludicrous! When you're in a healthcare crisis you're not worrying about what is covered and what is not. You're worried about your loved one! So to bring this story to an end the insurance company ended up paying roughly 500-600 total on the $3000 bill. I paid the rest! That's $2400 in case you don't want to do the math. I was furious! I was livid! I was things I can't write here! I had faithfully paid in 3380 a year for the last 3 years. Thats a total of $10,140! Out of that money the insurance company reimbursed me $80 the 2nd year and $600 the third year. A whopping total of $680! Now I understand insurance companies are in the business of making money and I do not begrudge them that. But they also have a responsibility for holding up their end of the bargain and it was clear to me that this company was not going to do that! It made me absolutely furious! Did I say it made me Furious!!! I was Furious!!! I talked to my wife about it and while she was not entirely happy she agreed to let me drop the insurance. I marched into work the next morning and canceled it! When they tried to talk me out of it I went ballistic!!!!!! I made it clear in no uncertain terms that they had better cancel my policy and I didn't want to have anything to do with health insurance again. About 8 months later they switched healthcare insurance providers and tried to get me to sign up again since they... and I quote... "Had a solid responsible insurance company this time". By than I had put over $2000 into a savings account having faithfully paid the $65 a week to myself. I told them where they could stick it and continued to put $65 into savings. I had opened a separate savings account so I wouldn't get this money mixed up with mine. Whenever we had medical expenses I transferred the TOTAL COST of the medical expense from my savings into my checking and paid it. So my plan pays 100%. I'm now sitting on enough money I feel it should be better invested. I'll keep a certain amount liquid. Best insurance plan I've ever had. I also find that healthcare providers tend to offer me better pricing when they learn I do not have insurance. Go figure. I know there are people out there that will say I'm crazy. Well, I never said I wasn't but I'll be dammed if I line the pockets of another crooked insurance company with money again. And I know there are those companies that are not crooked but I am beyond trying to find them.
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