December 1, 2010 § Leave a comment
Don’t you hate it when you read something, and as you’re reading it you’re like “yeah, man, this is good. Good stuff. Gotta remember this.” And sure enough, you do and it’s made a good impact on you and you think about it all the time. But then you want to use it in some more formal context (you know, like a blog. The most formal of mediums) and you can’t for the life of you remember who said it in the first place, where you read it and it’s vague enough that even a Google search isn’t going to help you.
Yeah. I hate that.
But I read something the other day. It was about a young, ambitious investor who started an investment agency or hedge fund but couldn’t get people to invest their money with him because he didn’t have a track record. The part that stuck out to me so much was he simply said to himself “well, if I want to get a track record, I just got to start. You can only have a years experience by working for a year.” So he scraped together a little bit of money with a business partner and then, obviously, had great returns, big float at the parade and won the girl before the credits. Moral of the story: get to work.
That notion of “ok, I have no experience. Guess I’ll just start here and go for it” has stuck with me. I’m a baby investor. I didn’t know a stock from a stalk 3 years ago. I got sucked in during the crisis of 2007-08 and a window of interest I never knew I had (ie: finances and business) was opened and I devoured anything I could get my hands on. (You can read more about it in the about section if you like.) I started a portfolio with some savings, made a bit, lost a bit. But it hasn’t been til recently that I decided to really put some effort behind this.
Hence this blog.
And the idea of a track record is an important one.
One of the things I am going to do (and learn by doing) is business (and therefore stock) valuations in hopes of finding great business at cheap prices or even “yeah, ok, whatever” business at awesome prices.
And I want to keep score! But I don’t have unlimited funds in order to do this in real life.
Enter: The Motley Fool CAPS system. If you aren’t familiar with http://www.fool.com, stop reading, go there now and read everything there. (Actually, no, finish this article, leave some insightful comments that advance my learning, tell a friend about B450, then go to fool.com). The Fool is dedicated to financial literacy and training, and one way they do this is through their CAPS system. It’s essentially a stock tracking system that gives points to the pickers (and weighs the points towards the better % pickers.) Sure it has its limitations (like, its not really a portfolio. Everything is weighted equally. You can’t weigh one pick at a higher % of your portfolio. On the plus side, you get hats!)
So I am setting up a B450 CAPS page. I’ll both blog here and on the Fool. I’ll do detailed stock writeups here and there and I will “buy” if it is at an attractive price. I may even do writeups on stocks I’m following in hopes that their price goes down. Shoot, and if I’m lucky, maybe some of the fool gurus will lend their expertise here on B450.
(If I buy in real life too, I will for sure let you know too. Full disclosure is important. I hear if you don’t Ben Bernanke actually brings his helicopter to your house and slaps you.)
So you can follow my picks here or search for Batting450 at fool.com. I’ll tag every post that I am linking to my CAPS page so you can stay up to date too.
The track record starts now! Time to learn by doing.