Tuesday, December 27, 2016

My 6 years of Investment in Stock Market

Six years ago, I was introduced by a friend of mine about investing in stock. Prior to that, i had a very ugly impression in stock market. When i was young, i always watched Hong Kong movies, and some of the movies shown about speculating in stock market. Stock market was all about gambling, pure speculation - that was all in my mind.

But thanks to my friend for introducing me about value investing and even asked me to read investment books like "One Up On Wall Street" by Peter Lynch and "The Zulu Principles" by Jim Slater.

Since then, i started to read many investment books. So far the book i really like the most are "Common Stock and Uncommon Profit" by Philip Fisher and "Intelligent Investor" by Benjamin Graham. I bought "Security Analysts" 3 years ago and until today i have not finished reading the book yet. I think I have been having much difficulties in interpreting the contents in the book :(  I guess my investment knowledge is really very little. 

There were times when i stop myself totally from learning about investment. If my memory serves me right, i skipped reading financial reports in 9 months from June 2015 to March 2016. I picked up reading the financial reports again in March 2016 and at that time i found 2 companies which i really liked: Best World & Cogent. I bought Best World in April this year @$0.53 per share and Cogent @$0.41 per share. Too bad i sold my Best World somewhere in June at about @$0.78 per share and my Cogent at about $0.50 per share in May. I managed to have $10k profit from Best World and $1.5k profit from Cogent. Actually i was not supposed to sell these 2 stocks earlier. I sold Best World as i heard this stock was in restricted stock from one of the broker's list - so i was not able to transact Best World online (if i wanted to buy/sell i had to call the broker). I was not really comfortable with this news, so i sold all my shares. I realized my decision is a fool. The fundamental of the business was still good and i still liked the company. It means clearly that my decision was wrong and my investment knowledge was really very little. If i did not sell my Best World's share from my initial purchase, my paper profit would be $43k now (my initial capital was $20k). I bought back Best World at about $0.71 per share and i am still holding it now. The same story goes to Cogent as well. But i had decided not to buy back Cogent for certain reason.

I like the way Warren Buffet buying stock - is like buying a business. I hope i can be like him to be able to hold my stock in a very long period of time along with the business grows. I am doing my best to focus on the company in my investment.

I started my investment with the capital of $2k six years ago. Along the way, i have made a lot of mistakes, countless mistakes which i should had avoided them earlier. In fact, i keep repeating the same mistakes again and again.

However, i feel thankful i am still able to see my capital appreciation of a high five-figures.

Although i am very sure i will make many more mistakes in future, but i do hope my mistakes will be much lesser.

Let's work harder to keep learning and always decides based on the data (not assumptions). Ganbatte!






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