After a few experiences of frustration with "Financial Advisors" where I was left with the impression of "I could do better than that" and feeling like they were making more money off of my investment than I was, I've decided to put my money where my mouth is and invest directly in some stocks. I'm just dabbling for now, as I don't want my initial lessons in the market to be too costly; the majority of our money is in mutual funds.
I have to admit that Jim Cramer of Mad Money is also a big reason why I'm investing. I had flipped past Cramer on CNBC a few times and my first impressions were really negative. I'm a pretty laid back guy, and hyper people get on my nerves. It wasn't until I heard Cramer's bio that my opinion of him turned around and I've been watching him semi-regularly for the past few months now. He seems to be a pretty polarizing figure, and perhaps the antithesis to the finance professors I will likely be exposed to in business school; however, I believe he provides valuable insights into a pretty mystic industry. However, I am certainly not going to follow his advice blindly, but I believe he is the last person on the planet, err street, that would advocate that I should.
I'm off to a pretty decent start. My first picks have been AMD, OSK, NYX, and AAPL. I had buyers remorse with AMD after a week or two, and sold it on the upside, although after transaction fees I lost about $6 on the trade. But, the stock is almost $3 down from where I sold it, so I still did pretty good. Why did I sell? I think AMD makes a great product and they are slowly chipping away at Intel's market share, but the fierce competition between the two is reducing profit margins as each try to undercut each other. Great for consumers, bad for investors.
Oshkosh Truck Company, headquartered just 30 minutes away from me here in Wisconsin, is a well run company with excellent products. I think they are a long run play and one of the better mid-caps. They have been getting more business outside of defense, so they aren't as sensitive to that line of business. This stock is actually one where I ignored Cramer's advice, but I'm up about 7% to date.
My next pick is the New York Stock Exchange itself. I bought in to Cramer's thesis on this stock. They are buying the European Stock Exchange Euronext and look to have their sites on Japanese and other foreign exchanges. They are also automating their operations. The trading floor of yore is turning into a lean money-making machine.
Lastly is everyone's darling, Apple. I had pretty good timing on this so far and bought it a little depressed and right before the iPhone announcement. Let's see how Motorola's lawsuit affects this.
So, there are my initial picks. I'm planning on picking two more stocks, then letting the $2,500-$3,000 mill around and see what comes of it after a year or two of my personal management. I've added my portfolio to the sidebar so you can follow along if you are so inclined. Let's see if I'm smarter than the market, or, more importantly to me, those "financial advisors".
--Chris
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