So..... I have money on the mind. Constantly. Right now I have $2,000 burning a hole in my checking account (That isn't the total in my checking account, I just closed a CD and put that $2,000 from the CD into my checking). For weeks, it has been calling out to me: "Ben....play with me!...invest me...... put me in the stock market....I'll make you rich...." So, I'm considering it. I have a bit of research still to do, but I want to put the money into a cheap (less than $10)small-cap value stock. I found one such stock about 2 weeks ago. Had I invested in that stock when I decided it would be a good buy, by the next day, I would have had about $4,500. Of course, if I had hung on to it until today, I would have only $2133- still an improvement, but damn- I picked the right day to pick it. (By the way, the stock in question was Pyramid oil.
So... I could do a couple of things:
1) Sink my $2,000 into an index mutual fund, like the nasdaq-100; which, depending on whose index you use has anywhere from doubled to quadrupled in the last 4 years. The problem with this - I'm going to have to pay a load- either front, back, or level- (kind of like a fee- a percentage of my investment gets paid to the brokerage-- its how they make money for handling the fund). Plus, I'll have to pay an annual fee- usually around 1.5% of my initial investment.
2) Sink my $2,000 into an individual stock and hold it, hoping that the company does really well. If I were to do this, I'd choose a company that I think is going to have a lot of success over at least the next two years. (Because if I sell the stock before 2 years is up, I get hit with a 28% capital gains tax - versus holding it, where I'd only pay upwards of 20%)
3) The most interesting and time consuming choice: buying up cheap value stocks, hoping they rise sharply in a day or so, and then selling. Why its good: you might double your money (or better) in a single day. Why its bad: you might cut your money in half (or worse) in a single day. This is highly advised against, but at least I would be using a seemingly insignificant amount of money. I mean, lets say that I put that money in an account that only gained 7% interest over my lifetime. By the time I'm 65, that money would be worth $30,000. At 10%, (The average of the stock market over the last 100 years or so), that money is worth $90,000.
So anyways, I have money on the mind in a big way. I'm learning, I'm reading a book about investing, and once I'm done with my book, I'm going to call my uncle, who has done a ton of investing and portfolio management. By the way, once my cousins graduated from college a few years ago, he turned over their portfolios to them. (He had been managing them since they were little). When my cousin Jay, who is my age, got his portfolio... he bought a condo in downtown Chicago with cash. So.... yeah. I'm hoping he might have a little bit of wisdom to impart upon me.
And thats where I am right now. I also miss hanging out with friends- got to hang out with Husband, Wife, and Sasha recently- and I had a great time. It makes me wish for a couple things: 1) that I had a living arrangement that was better for entertaining 2) that Jessica was 21 so that we could all go out to the bar. Right now, my options for inviting people to hangout are limited. (Lets hang out in my basement where I don't have a table or any chairs..... or.... lets go to a non-bar, like Pizza House... or go bowling- both things that begins to get expensive and loud). Whatever... maybe this summer I'll be able to think of some neat things.
Thats all folks. I'm starting to feel guilty for not working while here at work.
So... I could do a couple of things:
1) Sink my $2,000 into an index mutual fund, like the nasdaq-100; which, depending on whose index you use has anywhere from doubled to quadrupled in the last 4 years. The problem with this - I'm going to have to pay a load- either front, back, or level- (kind of like a fee- a percentage of my investment gets paid to the brokerage-- its how they make money for handling the fund). Plus, I'll have to pay an annual fee- usually around 1.5% of my initial investment.
2) Sink my $2,000 into an individual stock and hold it, hoping that the company does really well. If I were to do this, I'd choose a company that I think is going to have a lot of success over at least the next two years. (Because if I sell the stock before 2 years is up, I get hit with a 28% capital gains tax - versus holding it, where I'd only pay upwards of 20%)
3) The most interesting and time consuming choice: buying up cheap value stocks, hoping they rise sharply in a day or so, and then selling. Why its good: you might double your money (or better) in a single day. Why its bad: you might cut your money in half (or worse) in a single day. This is highly advised against, but at least I would be using a seemingly insignificant amount of money. I mean, lets say that I put that money in an account that only gained 7% interest over my lifetime. By the time I'm 65, that money would be worth $30,000. At 10%, (The average of the stock market over the last 100 years or so), that money is worth $90,000.
So anyways, I have money on the mind in a big way. I'm learning, I'm reading a book about investing, and once I'm done with my book, I'm going to call my uncle, who has done a ton of investing and portfolio management. By the way, once my cousins graduated from college a few years ago, he turned over their portfolios to them. (He had been managing them since they were little). When my cousin Jay, who is my age, got his portfolio... he bought a condo in downtown Chicago with cash. So.... yeah. I'm hoping he might have a little bit of wisdom to impart upon me.
And thats where I am right now. I also miss hanging out with friends- got to hang out with Husband, Wife, and Sasha recently- and I had a great time. It makes me wish for a couple things: 1) that I had a living arrangement that was better for entertaining 2) that Jessica was 21 so that we could all go out to the bar. Right now, my options for inviting people to hangout are limited. (Lets hang out in my basement where I don't have a table or any chairs..... or.... lets go to a non-bar, like Pizza House... or go bowling- both things that begins to get expensive and loud). Whatever... maybe this summer I'll be able to think of some neat things.
Thats all folks. I'm starting to feel guilty for not working while here at work.
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