Investing According to Guru Ebby

DISCLAIMER: This should not be considered investment advice. Find someone who actually studies these things if you want investment advice. This post, and future ones like it, will only be used to illustrate my personal investment practices. If you choose to follow what I say here and use it, good luck. Just do not come back to me when you lose all my money; I will probably have done so too.

I have always had a passing interest in investing in the stock market. Many times over the past few years I have dabbled, putting $100 here and there and getting cold feet after losing a few points on the stocks that I bought. for example, right before the American auto industry tanked a few years back, I purchased 10 shares of Ford (F) when it was trading around $1.50 a share. When it dipped close to a $1, I sold it all at a loss. Now, with Ford trading right around $18 a share, I am a little upset that I still don’t have those 10 shares. It would not have been a lot of money, but it would have been more than I have in there now.

Anyway, when I was in Iraq last year, I had a little bit of disposable income (well, money that probably could have been better spent paying off a bit more debt) and decided to start investing a little bit more. For about eight months or so, I put $100 twice a month into my Sharebuilder account and purchased various securities while I was over there. Some were and have been successful. Some of them were duds and not held very long at all. In this reoccurring series (hopefully), I will discuss some of my choices over the year. Before I do that, however, I’ll give you a quick idea how I decided to choose most of my securities.

Since my exposure was so minimal, and I didn’t want to spend forever researching companies, I started by purchasing companies that I had some sort of exposure, with the belief that if I am purchasing the products of companies, I would be a little more “invested” in the performance of the company. That’s how stocks like AT&T (T), Apple (AAPL), Boston Beer Company (SAM), and Ford ended up in my portfolio.

Next, the other purchases I made were companies that were cheap but had room for growth. Many in this group were based on the recommendations of a member of my Reserve unit who was heavily into investing. This group included companies like Citigroup (C), MGM Resorts (MGM), Under Armour (UA), General Electric (GE), Bank of America (BAC) and others that I can’t think of right now.

Finally, there were the stocks that I took chances on. One such choice was Blockbuster prior to their bankruptcy announcement. I purchased a couple hundred shares at 50 cents a shares with the hopes that they wouldn’t actually declare bankruptcy. Unfortunately they didn’t make it through that quarter and declared bankruptcy. Fortunately, my loss was mitigated as I sold all my holdings for around 37 cents, making my overall losses right around $36 or so. This was countered by some other gains that I had made.

Over the next few posts from this series (Investing), I will go a bit more in depth over some of my choices. Again, per the disclaimer, do not hold me accountable for any losses you have should you follow my “advice.” Hopefully, you learn something. If you don’t, I never said I was a professional.

Until next time…